The Woracle

Quite a competition is under way in Europe, as EADS tries to sell off all or part of six Airbus plants as part of its Power8 restructuring plan, including Filton in the UK, Meaulte in France and Nordenham in Germany.

Reuters has published a list of 14 companies it says have submitted bids for the plants.

The list includes some familiar names in the aerostructures business: the UK's GKN , France's Latecoere, Sweden's Saab, the USA's Spirit and the Netherlands' Stork. But there are also some less familiar names.

What's the connection between these two aircraft?

One is the Killer Bee UAV. One is the Eclipse Concept Jet VLJ. Both were built by Swift Engineering, which also built this:

California-based Swift is one of several motorsports companies applying their skills to aerospace.

GAMA, the General Aviation Manufacturers Association, provides great data on the industry, and its latest quarterly delivery report shows that the predicted - and feared - explosion in the VLJ market is more like a slow burn.

In the first six months of this year, VLJ deliveries totalled 31 aircraft - 10 Citation Mustangs and 21 Eclipse 500s. But that is 30 more VLJs than last year. Eclipse may be struggling to ramp up deliveries, but Cessna says it will ship 44 Mustangs this year, 100 in 2008 and 150 in 2009. That's not exactly blackening the skies but, for a single bizjet type, those are numbers this industry is not used to.

Acquiring companies in Eastern Europe is becoming fashionable, it seems. Now GE is buying Walter Engines, the Czech company known for its low-cost PT6 alternative, the M601 turboprop.

GE follows Sikorsky, which purchased Polish aircraft manufacturer PZL-Mielec earlier this year, and Pratt & Whitney Canada, which took over Polish engine maker PZL-Rseszow in 2001.

The M601 is best known for powering another Czech product, the 19-seat Let L-410 - and Let leads us to another, almost forgotten, link between GE and Czech industry.

GE's CT7 turboprop powered the 40-passenger L-610G, which was orginally designed to use the Walter (then Motorlet) M602.

The L-610 perished in the disastrous take-over of Let by US agricultural aircraft manufacturer Ayres (remember the Loadmaster?). But Let and the L-410 survived, and now GE is getting back on board.

In case you missed the week's headlines, here's a synopsis of the main events.

Aviation record-setter Steve Fossett went missing on 2 September after taking off from Reno, Nevada in a Citabria. He was first to fly round the world in a balloon, in 2002; and first to fly solo round the world without stopping or refuelling, in 2005. Chances of finding him alive - diminishing.

Boeing announced the 787 first flight had slipped to between mid-November and mid-December, from late August, but it still plans to deliver the first aircraft to launch customer All Nippon Airways. That will compress the certification flight-test schedule from nine months to less than six. Chances of the making the schedule - debatable.

DayJet and Linear Air were approved by the FAA to begin air-taxi operations using very light jets. Massachussetts-based Linear, with a single Eclipse 500, plans to fly its first paying customer by mid-September. Florida-based DayJet will be hard on its heels with a dozen Eclipses. Chances of making it work - improving.

The US Air Force acknowledged that a B-52 unknowingly carried six nuclear warheads across the USA. The bomber flew from Minot AFB in North Dakota to Barksdale AFB in Louisiana carrying Advanced Cruise Missiles that mistakenly still had their W80 warheads installed. Chances of a nuclear accident - negligible. Chances of extreme embarrassment - certain.

Even as it battles to win the contract to build the US Air Force's next aerial refuelling tanker, Boeing has won the hard-fought competition to overhaul the USAF's existing KC-135s.

The 10-year, $1.1 billion contract covers programmed depot maintenance of more than 200 KC-135s to keep them flying until the KC-X comes along.

It was a tough competition, pitting Boeing against Pemco Aviation Group - it's subcontractor on the current KC-135 PDM contract, which ends in October. The two companies were originally teamed for the new contract, but Pemco was dropped by Boeing and decided to bid on its own.

Despite their disparity in size, winning the KC-135 work was importrant to both companies. Boeing said the PDM contract was crucial to the future of its San Antonio overhaul operation, and Pemco is selling its booming commercial MRO business to focus on military maintenance - a significant part of which was KC-135 PDM.

My colleague Steve Trimble over on The Dew Line is taking bets on whether Pemco will protest the award, as seems to be the fashion these days.

If it stands, the win is vindication of Boeing's decision to apply its commercial-aircraft lean production experience to the military-aircraft maintenance environment, creating a "pulsed" line and cutting a KC-135 overhaul from 200 days to 153 - numbers that now have the airlines asking about lean MRO.

Call me a cynic, but I am suspicious about the timing of Pogo Jet's initial public offering to raise more than $100 million to launch its air taxi service.

We've hardly heard from Pogo since it was formed in 2001 - except for announcing an order for Adam A700 very light jets that not-so-mysteriously evaporated. Now, just as DayJet and Linear Air are on the verge of launching the first air-taxi services to use Eclipse 500 VLJs, Pogo is back in the news, looking for money.

The timing of its IPO makes sense. It can ride the publicity as DayJet begins operations and bank the money before it becomes clear whether the air-taxi model works. I note that DayJet and Eclipse have raised millions in private equity and are waiting to prove they can deliver aircraft and attract customers before they go the IPO route.

But then I am a cynic.

Here are a couple of headlines you may have missed:

Google founders Larry Page and Sergey Brin caused a stir when their VIP Boeing 767-200 was spotted at NASA Ames' Moffet airfield in California, normally off limits to non-government aircraft. NASA subsequently acknowledged it had signed an agreement to let the 767 use Moffet in return for the right to place scientific instruments on the aircraft. The two-year deal will net NASA $1.3 million to offset the cost of operating Moffet, but has riled its neighbours.

France's defence minister, in interview with La Tribune, said the Airbus Military A400M airlifter would be delivered several months late. The first customer for the A400M, France had expected it to enter service at the end of 2009, but defence sources quoted by the newspaper said the first aircraft was now expected to be delivered six to nine months late. EADS defence chief Stefan Zoller acknowledged the first flight was six months behind schedule and Safran took a €40m writedown to cover delays to the TP400 engine.

Ever since Boeing took over McDonnell Douglas in 1997, the company has tried to project a "One Boeing" image. It has never been true. The commercial and defence sides of the company have different cultures. So Boeing has worked to bridge the divide, moving executives between the businesses.

The latest move sees an Integrated Defense Systems executive move to Boeing Commercial Airplanes to take over the troubled 787 programme. But look closer and you will see that Pat Shanahan is actually returning to BCA, where he once ran the 757 and 767-400ER programmes.

Seattle sticking with its own, Boeing bridging the divide - or defence taking over? All three, perhaps. Shanahan could be a poster boy for "One Boeing". An acolyte of former BCA boss Alan Mulally, he established a reputation at IDS for turning round troubled businesses. He brings that rep to the 787.

More significantly he brings experience of IDS to BCA, and to a programme that is crucial to Boeing's future. Mulally briefly ran Boeing's defence business before returning to Seattle to lead the commercial business out of its production problems. But corporate Boeing's struggles with ethics scandals denied him the chance to bring that experience to the role of CEO.

Shanahan and other executives like him represent the first chance for the company to make "One Boeing" a reality.

It's that time of year again. The US National Aeronautic Association is calling for nominations for the 2007 Collier Trophy, awarded each year for the greatest achievement in aeronautics or astronautics in America (sorry Airbus, no Collier for the A380).

You have until 31 January 2008 to submit your nominations to NAA (to find out how, click here).

I've said before that I think NASA's Mars Rovers, Spirit and Opportunity, deserve the Collier Trophy, so they get my vote. But there must be others deserving of nomination. Remember, to qualify, the value of the achievement must have been "thoroughly demonstrated by actual use during the preceding year".

Some of the recent winners: F-22 Raptor (2006), Eclipse 500 (2005), SpaceShipOne (2004), Gulfstream G550 (2003), Sikorsky S-92 (2002), JSF LiftFan (2001) and the Global Hawk (2000). In support of my nominee I would point out that the last time an achievement in astronautics a Collier was in 1993 for the Hubble repair Shuttle mission.

Nothing ever really goes away in aviation. Take the AG-5B Tiger, which True Flight Aerospace plans to build in Valdosta, Georgia. This is the four-seater that Tiger Aircraft built in Martinsburg, West Virginia till it went bankrupt in January. It is the same Tiger first produced by Grumman American in 1974.

Grumman American was bought by Gulfstream, which ended production of the Tiger in 1979. The line was restarted in 1990 by American General Aviation, which closed its doors after just three years. Then came Tiger Aircraft, which produced just 51 AG-5Bs between 2001 and 2006. Now True Flight is taking up the reins.

Tiger, Tiger...On what wings dare he aspire?

The Tiger is a sturdy all-metal aircraft, clearly well-loved by its owners. I am torn between applauding True Flight for keeping a classic alive and lamenting money spent preserving old designs that appeal to old farts like me when we should be producing new light aircraft that will attract new pilots.

Rolls-Royce is to assemble engines in Singapore and a new site in the USA, in part to be closer to its customers and in part to reduce its exposure to the dollar. It is interesting to see the US, where the domestic industry is fiercely criticised for outsourcing, become a preferred location for "insourcing".

Rolls plans to assemble its new RB282 twin-shaft engine at a new facility in Virginia (and not far from the nation's capital), even though development is under way in the UK and the launch application is a French business jet. The reason is that North America is the biggest producer and consumer of business jets.

There is definitely an insourcing trend under way. Some of it is European manufacturers moving work to the US to win US government contracts (assembling Eurocopter EC120s and EC145s in Mississippi, for example). But as the dollar falls against the euro and the pound, there is an increasing economic rationale for moving work across the Atlantic.

At some point the value of work insourced from Europe could become a significant factor in the US aerospace industry's performance. The political implications of that would be interesting to see.

In one week Cessna has agreed to buy the assets of Columbia Aircraft and outsource the manufacture of its new light sport aircraft to China. Both decisions owe a lot to the company's booming business-jet production, which is filling its factories as well as its coffers.

Cessna has already sold almost 900 Model 162 SkyCatcher LSAs, but at the bargain price of $109,500. So they are to be assembled by Shenyang Aircraft because the Chinese manufacturer can make them more cheaply than Cessna, which will retain responsibility for design, airworthiness compliance and manufacturing oversight.

The Columbia acquisition includes its two upmarket piston singles, to be renamed the Cessna 350 and 400, but also vaults the company into the all-composite light aircraft business. It will be interesting to see how Cessna's Next Generation Piston project morphs once its product line includes this pair of Cirrus-beaters.

NGP = No Go Plane? Will Columbia change Cessna's piston thinking?

If Cessna follows the industry trend towards composites, then the former Columbia plant in Bend, Oregon could become the home of a complete range of advanced light aircraft while its Independence, Kansas single-engine plant could switch over completely to the high-volume production of very light jets.

UPDATE - this statement has just been released by ATG:

"ATG, with the help from a Wall Street banking institution, has been seeking funding to continue its Javelin high performance business jet and military trainer for the past 12 months. Due to circumstances beyond ATG's control, it is unlikely that adequate funding can be secured in a timely manner. ATG has therefore decided to halt development of the Javelin at this time. Further action will be decided upon after proper communication with our strategic business partner."

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The Denver Post is reporting that Aviation Technology Group - the Denver-based developer of the Javelin two-seat very light jet - has sent most of its employees home as it makes a last-ditch effort to find funding. The Post says ATG plans to meet with strategic partner Israel Aerospace Industries this week after an effort to raise $200 million was unsuccessful.

Mortality rates are high among general-aviation startups, and particularly among VLJ hopefuls: flightless failures include the Avocet Projet (designed by IAI) and the Safire Jet. Even Eclipse, with its aircraft successfully certificated, is on the hunt for more cash after falling far short of its first-year delivery target because of problems ramping up production.

ATG has always looked risky because it is targeting a narrow subset of the VLJ market - those buyers wanting a fighter-like two-seater they can pilot themselves. Its apparent advantage has been the potential market for the Javelin as a military trainer - hence IAI's involvement. But that has always been an unpredictable and competitive market - ask Pilatus etc.

Is No2 light-aircraft maker Cirrus Design looking for a buyer? There are a couple of conflicting reports out there, but I side with the reliable Molly McMillin of the Wichita Eagle. She quotes Cirrus spokeswoman Kate Dougherty as saying controlling shareholder Arcapita "buys and sells companies...they are not in the airplane manufacturing business".

Cirrus is getting all this press because its biggest competitor, Cessna, has just bought its second biggest competitor, Columbia. But Columbia was in bankcruptcy protection and Cirrus is not. Cirrus is not because the founding Klapmeier brothers took the hard decision a few years ago to sell a controlling stake in their company in return for the investment required to boost its piston-single production into the big time.

It should be no surprise if Bahrain-backed Arcapita wants to cash out – Cirrus is profitable as a piston-single producer, but wants to expand into single-engine jet production. That takes money – and if Arcapita can both get a return on its investment and bring new capital into Cirrus by selling its stake or launching an IPO, it makes a lot of sense.

In my opinion any talk of Cessna buying Cirrus is nuts - even I would file an anti-trust suit to stop that happening. Cirrus is the goad Cessna needs to make it innovate. Hawker Beechcraft as buyer? Maybe. Some outside entity that can bring Cirrus and Eclipse together? Now wouldn’t that be interesting?

Who wouldn't want to buy the company that builds this beauty?

Welcome to the fast-changing world of who owns who in general aviation...

Eclipse has secured more than $100 million in new equity to fill the hole in its finances left by the failure to deliver on its promise of producing 500 VLJs in its first year (it built 103). The money is coming from ETIRC, a Dutch investment firm with connections to Russia and Eclipse's distributor in Europe, the CIS and Turkey. ETIRC will become Eclipse's single largest shareholder, but still with a minority stake.

This is just the latest transaction in the investment-hungry world of GA. Here are some of the others:

Hawker Beechcraft - the former Raytheon Aircraft was bought by private equity firms Onex and Goldman Sachs for $3.3 billion in March 2007.

Adam Aircraft - has raised $200 million in equity and debt to produce the A500 piston twin and A700 VLJ, with Goldman Sachs as its largest outside investor.

Epic Aircraft - has sold a 50% stake to Indian brewery and airline magnate Vijay Mallya for around $200 million to finance development of very light jets and turboprops

Columbia Aircraft - piston-single manufacturer was bought out of bankruptcy protection by Cessna in December for $26.4 million.

Sino Swearingen - UK distributor Action Aviation is finalising a buy-out from Taiwan with private-equity financing to ramp up production of the SJ30 light jet

Cirrus Design - it has been reported that Bahrain-backed majority owner Arcapita wants to sell the light-aircraft maker, which needs funds to develop a single-engined jet.

The debut of a new Cessna piston single is a rare event - as far as I can work out the last one was the Model 177 Cardinal in 1967 - so mark 8 March 2008 in your diaries. That's when Cessna's Model 162 SkyCatcher light sport aircraft flew for the first time (from Cessna Field in Wichita). Cessna hopes the SkyCatcher will be the new 152 and, with its modest price and easy operation, will persuade more people that flying is affordable and enjoyable.