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Aviation History
2002
2002 - 0069.PDF
BUSINESS CONSOLIDATION NICHOLAS IONIDES / SINGAPORE China's airlines carry on talking Media claims carriers are arguing over details, but aviation authority denies setbacks The restructuring of the Chinese airline industry has been delayed by disputes between carriers due for merger. But the authorities insist that the merger of 10 carriers into three massive groups will still go ahead this year. According to state-run media reports, flag carrier Air China and China National Aviation (CNAC), owner of-Zhejiang Airlines, are fighting over who will control Zhejiang following consolidation. They also report that China Eastern Airlines is unwilling to take on China Northwest Airlines' 3 billion yuan ($362 million) debt. However, the Civil Aviation Administration of China (CAAC) has denied the reports, saying the claims of serious problems are "totally groundless", and that full details should be worked out in the first half of this year. Senior CAAC official Ma Songwei says that rumours have been fuelled by delays in negotia tions between some of the carriers. He claims that "everything is going well in the merger and the CAAC will only help push it forward, not disrupt the process". Agreements being finalised by the airlines are "still keeping up with the CAAC's original plans", he adds. Authorities have for years been calling on the country's more than 30 carriers to merge, saying unnec essary competition has badly hurt the indigenous industry. In mid-2000, the CAAC ordered the 10 airlines under its direct "control and administration" to consolidate into three groups, headed by Beijing-based Air China, Shanghai-based China Eastern and Guangzhou-based China Southern Airlines. Basic merger agreements were approved by the CAAC in April. The State Development Planning Commission is assessing the air lines' plans and will seek final approval from the State Council. Under the plan, Air China will take over China Southwest Airlines and CNAC; China Eastern will acquire China Northwest, Great Wall Airlines and Yunnan Airlines; and China Southern will take over China Northern Airlines and China Xinjiang Airlines. China Eastern has already completed its takeover of Great Wall while China Southern reports good progress. Chinese authorities want to reduce competition between domestic carriers ACQUISITION Telespazio buy-out stalls Finmeccanica and Telecom Italia remain deadlocked over Finmeccanica's offer for Telecom Italia's space divi sion, Telespazio. Telespazio is believed to be worth €350-500 million ($315- 450 million), depending on the fate of satellite service provider Astrolink, in which Telespazio has a 18.5% stake. Telespazio has already invested around $250 million, and after fellow shareholder Lockheed Martin decided to write off its $400 million investment, Telespazio could be forced to follow suit. The burden of Astrolink could bring Telespazio's final price into the lower end of the range. AIRCRAFT DEVELOPMENT RSK MiG and Tupolev near Tu-334 agreement Russian airframe builder RSK MiG seems set to confirm its develop ment deal with Tupolev over the Tu-334 twinjet, after more than two years of equivocation. Sales of MiG-29 fighter aircraft soared last year - over $1 billion booked - enabling RSK MiG to set up the Tu-334 assembly line at its Voronin plant, according to general director Nikolai Nikitin. RSK has agreed to pay $25 mil lion towards certification of the Tu-334, which it aims to produce at Voronin in co-operation with the Aviant plant in Kiev, Ukraine. The prototype has so far made more than 100 flights. Combined with state funding, RSK's investment will allow type certification in 2003, a year earlier than expected. The government has called for 2,390 million roubles ($78 million) investment in the Tu-334 in 2002-5, including 1.6 billion roubles from the state budget. RSK is also close to signing a deal on the Tu-334 with EADS, which wants to reduce the seating capac ity to 70-90, as the current 102-seat Tu-334-100 variant might compete with the Airbus A318. EADS will help gain European certification for the Tu-334 and is also understood to be interested in assisting the development of a "Westernised" version with Rolls-Royce BR715 engines. Deliveries of the standard Tu-334-100 should begin in 2004, at a unit price of $18-20 million. • The Tesna syndicate, which will take over Australian airline Ansett on 1 February, has named two new executives for the carrier. James Hogan, for mer chief operating officer of British Midland and previously an Ansett customer services executive, has been appointed chief executive officer. Adam Moroney, appointed as chief financial officer, is a former Qantas executive who worked with ex-Air New Zealand presi dent Gary Toomey in his attempted Ansett/ANZ merger. Both are currently working as advisers to the Tesna syndicate, which is led by Melbourne busi nessmen Lindsay Fox and Solomon Lew. • BAE Systems has appointed Howard Jones, formerly vice-president business development at Lockheed Martin Tactical Systems, to vice- president strategic planning for its Information & Electronic Systems Integration sector. The company has also named Norman Iverson as the new vice-president of business development for its Integrated Systems unit. Iverson comes from Litton, where he was responsible for business devel opment for two business units. • Floris van Pallandt, currently chief executive of KLM and the low-cost airline Buzz, will suc ceed Peter Legro, long- serving president and chief executive of Dutch carrier Transavia, this spring. Legro retires after 22 years as Transavia head. • John Thackrah, former vice-president of worldwide engineering at Otis Elevator, has been named vice- president of aftermarket for Pratt & Whitney's Large Commercial Engine business. • Delta Air Lines' vice-president corporate safety and compliance John Marshall has been named chairman of the Air Transport Association's safety council. Marshall was formerly vice- chairman of the council. • Edward Fred, chief financial officer and secretary of aero space and defence electronics contractor CPI Aerostructures, has been promoted to president. His predecessor, Arthur August, will remain with CPI as chairman and chief executive. www.flightinternational.com FLIGHT INTERNATIONAL 8-14 JANUARY 2002 15
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