CSERIES FUNDING UNDER SCRUTINY BY USA
US trade negotiators are vowing to closely scrutinise the state aid being provided to Bombardier to support development of its CSeries family of aircraft. "The USA has long expressed concerns about government financial support for the launch of commercial aircraft," says the Office of the US Trade Representative. The $2.6 billion needed to research and develop the CSeries will come in roughly equal shares from principal suppliers, the Canadian and UK governments and Bombardier, which says it is confident that the funding plan meets international requirements.
PROFITS SURGE FOR ENGINE LESSOR
Engine lessor Willis Lease Finance reported a 45.5% jump in second quarter net income to $6.4 million on revenue up by a fifth to $37.2 million, including a 22.4% rise in lease rent revenue, to $26.2 million. The company's lease portfolio increased 21% to $787 million, including as of 30 June 146 commercial jet engines, 14 turboprop engines, three aircraft parts packages and four aircraft. It is selling or parting out seven of its 10 Pratt & Whitney JT8D engines, which power the ageing Boeing MD-80 fleet.
SERBIA WILL NOT REDUCE JAT SALE PRICE
Serbia's government is resisting pressure to cut its €51 million ($77 million) asking price for 51% of flag carrier Jat Airways and says it will finance a restructuring, possibly including acquisition of new aircraft in advance of a stock market flotation, if the privatisation fails. Jat was formally put up for sale last month, and any successful bidder would have the option to increase its share to 70%. However, economic concerns have prompted potential investors, including Aeroflot, to rethink the business case for buying into Jat, which has 11 Boeing 737s and five ATR 72s.
EMBRAER CUTS MANAGEMENT HEAD COUNT
Brazilian airframer Embraer is cutting 250 management positions in Brazil in a restructuring move. The cuts come shortly after the company reported a year-on-year doubling of second-quarter profits to $134 million Embraer delivered 52 aircraft during the second quarter, up from 36 during the same period last year, and reaffirmed full-year delivery expectations of between 195 and 200 large aircraft and 10-15 Phenom 100 very light jets.
FUND TO SELL CZECH AIRCRAFT WORKS
Slovak investment fund Slavia Capital plans to sell its 49% share in Czech Aircraft Works once the firm is declared insolvent bankruptcy proceedings began in March against the light aircraft maker, which has debts of more than CKr50 million ($3.1 million). Slavia has had bids exceeding €8 million ($11.9 million) from interested parties in the USA and Russia. Slavia bought into CAW two years ago with a CKr62 million equity investment to quintuple annual 100-unit production of light sport aircraft, especially for the US market. CAW's US owner, Chip Erwin, kept a 45% share.
ST AERO PROFIT FALLS IN SECOND QUARTER
Second-quarter net profits at maintenance, repair and overhaul group Singapore Technologies Aerospace fell 11% to S$61.6 million ($44 million) on steady turnover of S$493.4 million. The company attributed the drop in profit to "the lower US dollar exchange rate, higher depreciation, higher prototyping costs, lower contributions from associated companies and lower investment, interest and other income".
Source: Flight International