Leonardo is still not ready to name its partner in a proposed aerostructures joint venture but predicts the new business could be three times the size of the troubled Italian-based unit, which produces fuselage sections for Boeing, Airbus, and ATR but has long struggled to break even.
Robert Cingolani, Leonardo’s chief executive, says confidentiality issues and the need to complete funding agreements with the government of the country involved prevent him from making an announcement, even though “95% of the [cooperation agreement] has been done”.
However, speaking at the company’s annual results presentation on 25 February, he outlined his ambition for the enterprise. “On aerostructures, we are building something much bigger. Maybe triple [the existing business] and in the top three in the world,” he says.
The 50/50 joint venture will be a “global company” with its “brain in Italy” but a production plant in the partner nation. As that facility gains the ability to make certificated parts and more work is transferred, majority ownership could pass to the partner, says Cingolani. “But that timing depends on results.”
After presenting a strong set of financial figures – with revenue increasing 11% to €19.5 billion ($23 billion) over 2024 and new order values up 15% to 23.8 billion – Leonardo is due to reveal more details on its strategy at an update on its industrial plan on 12 March.
Cingolani – who has overseen a financial resurgence and industrial expansion at the Rome-based group since taking the top job just under three years ago – says the announcement will reveal much about “the future of Leonardo”.
He does say, however, that after inheriting a company where “businesses were in silos, not interacting with each other”, Leonardo’s “matrix of products is now complete” after heavy investment in space, digital and cyber technologies.
During the past year, Leonardo has been adding to its joint ventures and partnerships, which already include missile house MBDA, the Eurofighter consortium, turboprop manufacturer ATR and the Global Combat Air Programme with Japan and the UK.
Last June, it established an unmanned technologies joint venture with Baykar of Turkey called LBA Systems. It is also teaming with India’s Adani to set up a helicopter manufacturing ecosystem in that country, including potential final assembly facilities for the AW169M and AW190.
On space, a proposed merger with the non-launcher activities of Airbus and Thales is going through European regulatory approval, while Leonardo also expects to close in March its acquisition of the defence land systems business of Italian truck maker Iveco.
Cingolani also hints at a significant update on Leonardo’s UK business, where questions have been raised over the future of its Yeovil-based helicopter plant.
Executives from the Italian company, including Cingolani, have met with UK defence ministers several times this month to discuss prospects for the UK’s long-running New Medium Helicopter (NMH) programme, which would see AW149s manufactured in England.
Cingolani says Leonardo has been “working very intensively” with UK government, adding: “Let’s wait for one or two days.”
The UK has said it expects to make an announcement on the £1 billion ($1.35 billion) contract by the end of March.
He goes on: “I promise Leonardo will be an international company, not an Italian company, so our other home nations of the UK and USA are so important. In the UK, I strongly want a committed Leonardo UK, which is essential not just for Leonardo’s future as an international company, but the future of European defence.”
