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Aviation History
2000
2000-1 - 0074.PDF
BUStNE** E-biz starts to feel the pinch EMMA KELLY/LONDON AEROSPACE e-commerce company aviationX is imple menting a new business strategy which will see it focus on providing regional airlines with specific inter net-based applications rather than offering a broad online aerospace marketplace. The move is viewed by some industry observers as the first sign of a shake-out of the increasingly busy aerospace e-commerce sec tor. Meanwhile, Honeywell and United Technologies are targeting equity investment for their delayed myAircraft aerospace exchange in a bid to get it up and running. AviationX, launched at the Asian Aerospace show in Singapore in PEOPLE ++ The oneworld airline alliance has made its first appointments to acentral management team: Kathy Mullen joins from Canadian Airlines as global project director, John McCulloch is vice-president (VP) marketing and Bob McNair is VP information technology. ++ Leo Mondale is named president of Arianespace Inc. the European company's US subsidiary. He was an executive VP. ++ David Slack is to head logistics at British Euro pean. He was controller of opera tions for British Airways. ++ BFGoodrich has promoted its VP, technology and innovation, Jerry Lee, to senior VP technology and innovation. ++ Custom aircraft lessor CIT Aerospace of New York has named three VPs: Matthew Beirne, new aircraft programmes, Michael Walling, technical group and Christophe Chicandard, air line marketing. ++ Ohio-based cargo carrier Emery Worldwide Airlines has appointed Andrew Granuzzo VP safety. He has served as senior environmental/occupational safety executive forthe US Navy. ++ Hans Bakkar is appointed commercial director of the Hong Kong Airport Authority, responsible for busi ness development. February, was one of die first aero space exchanges. Its original busi ness plan called for the introduction of an e-marketplace for sourcing, procuring and exchanging information, goods and services. In the last month, however, die company has changed its strategy and is now developing specific web-based "procurement and workflow-ori- ented" applications for the region al market alone. The change is a result of two major developments. "Unanti cipated co-operation" on e-initia- tives among big industry players, such as Boeing/BAE Systems/ Raytheon/Lockheed Martin and various airline consortia, means there is "intense competition", it says, while the recent large-scale sell-off of US technology stocks means the original business plan - based on a public offering - is no longer viable. The Arlington, Virginia-based operator has cut its workforce by 15% and "made the necessary financial adjustments". AviationX has five customers: US regionals Mesaba Airlines, Express I Airlines and Chautauqua Airlines, brake control system and pump supplier Hydro-Aire and regional aviation maintenance specialist Piedmont Hawthorne Aviation. The five will begin testing its applications from the end of this quarter. AviationX is also dis cussing possible partnerships with software technology companies. AviationX believes its new model could represent the shape of things to come in the aerospace e- commerce market. "We've learned that it will take a lot longer to reach the e-commerce end game," it says. "This is a big market with different e-commerce needs." MyAircraft, meanwhile, has dropped its "dot.com" identity "to make it clear we are a real company with deep pockets", says vice-pres ident Scott Clements. It is target ing airline customers prepared to take equity stakes, with subscribers to come later. It plans to roll out services from the third quarter, stressing the savings to be had through collaboration on the sup ply chain, rather than simple e-pro- curement. • Military export slump spoils Europe's year DEEDEE DOKE/LONDON ADROP OF more than 40% in military exports last year dimmed an otherwise bright per formance by Europe's aerospace industry. Figures from the European Association of Aero space Industries (AECMA) show that turnover rose by 3 % (adjusted for inflation) to €66 billion ($63 billion), contributing to an overall growth of 44% from 1995 to 1999. Europe's profit margin of 7% in 1999 was a rise of 5% from 1998, and employment rose by 3% to 436,700. The figures reflect the aerospace industry's position as "a dynamic engine for economic development in Europe", claims AECMA president, Rolls-Royce chief executive John Rose. Civil domestic turnover rose by 11.4%, civil exports by 12.8% and military domestic sales by 10.4%. Of consolidated 1999 turnover, exports accounted for 51 % dianks to strong civil sales. Overall civil products contributed 69% of sales. Exports, at €33.2 billion, dwarfed total imports of €11.2 billion.The European Union aerospace turnover 1999 Civil export 42% go/o Military export 27% Civil domestic Source: AECMA EUSHZ GARETH BURGESS 00 figures would have been even bet ter had there not been a €4 billion slump in military exports. The downturn in military exports stemmed largely from the cancellation of major procurement programmes, mostly in Asia, says AECMA secretary-general Peter Fichtmiiller. He says direct sales to the US Department of Defense are still "marginal, almost non-exis tent", with European companies exporting to the market primarily as suppliers. • Elbit completes El-Op acquisition ELBIT Systems has completed its purchase of El-Op Electro- Optics Industries, creating Israel's largest private defence company. El-Op will operate as a subsidiary of Elbit, which adopted a new organisational structure on 5 July, when the merger went through. El-Op manufactures electro- optical products for the military and civil markets, offering aerospace applications in thermal imaging, lasers and optical systems (for spy satellites and airborne reconnaissance). Elbit is engaged in a wide range of defence-related airborne, ground and C3 programmes. Fighter and helicopter upgrades are a core competency (including the Northrop F-5 in Singapore as prime contractor, and with IAI in Turkey, and of the Mikoyan MiG- 21 in Romania), and will become the pair's main business focus. El-Op recorded sales of $303 million last year and made a net profit of $ 14.6 million, with a year- end order backlog of $558 million. Elbit sales were $436 million, with a $31 million net gain and a $736 million backlog. The pair will combine their results from the third quarter. • FLIGHT INTERNATIONAL 11 - 17 July 2000 18
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