Capt.Fantastic From United States of America, joined Aug 1999, 812 posts, RR: 0 Posted (12 years 7 months 3 weeks 4 days 7 hours ago) and read 2277 times:
Boeing CEO: Bolstering Euro Defense Operations Not Top Priority
June 25, 2003: 6:37 a.m. EST
LONDON -(Dow Jones)- Expanding its European defense operations is an aim for Boeing Co. (BA) but not the U.S. aerospace and defense group's highest strategic priority, Chairman and Chief Executive Philip Condit said Wednesday.
Speaking to reporters in London, Condit said Boeing's top priorities are the development of a new passenger aircraft and capitalizing on the huge U.S. defense market.
"It's on the list... It's not on the top," Condit said when asked if Boeing is aiming to bolster its European defense business possibly through mergers or acquisitions.
Boeing has long been viewed as a potential merger partner or acquirer of U.K. defense contractor BAE Systems PLC (U.BA) although Condit repeated Wednesday the group isn't actively pursuing a merger with BAE. Condit reiterated, however, that BAE Systems remains an "interesting" company as far as potential European partners go.
Condit said Boeing is only at the analytical stage with a view to any future alliance with BAE Systems. "What do we think it's worth? Might there be something there? No more than that," Condit said.
"The truth is we are constantly evaluating strategic opportunities," Condit said, adding that the company is always looking at what deals could create value for Boeing and its shareholders.
Condit said he hadn't spoken to U.K. Prime Minister Tony Blair or Defense Minister Geoff Hoon with regard to a potential deal with BAE Systems. "You have to have something to discuss," Condit said.
Condit reiterated that he believes there's now a high probability that Boeing's board will approve the development of a new fuel-efficient airliner branded the Dreamliner or 7E7. The board is likely to decide at the end of this year, he said.
Boeing isn't disclosing the level of the expected investment for the Dreamliner.
Turning to the aircraft market, Condit said there are signs of a pick-up in forward bookings but stressed "there are still unknowns ahead."
Boeing expects to deliver about 280 commercial aircraft this year compared with 381 jets in 2002. Arch rival Airbus (F.ABI) meanwhile expects to deliver around 300 jets compared with 303 in 2002.
Last week, Airbus picked up some large new plane orders from Middle East carriers Emirates Airlines (C.EA) and Qatar Airways.
Company Web site: http://www/boeing.com
-By Rod Stone, Dow Jones Newswires; +44 207 842 9295; email@example.com
Bobrayner From United Kingdom, joined Apr 2003, 2227 posts, RR: 6
Reply 1, posted (12 years 7 months 3 weeks 4 days 7 hours ago) and read 2245 times:
Interesting; thanks for the detail!
The European defence industry still needs more consolidation, I think.
Obviously, defence buyers like to shop near home wherever possible - and it's not just protectionism - so it's only common sense that Boeing will find much better opportunities in the USA than in Europe, especially given the former's swollen defence budget.
BAe has a (complex) connection to Airbus and has fingers in other pies, so there could be scope for conflicts of interest; certainly the monopoly / merger authorities would investigate anything like a takeover/merger.
Remember GE / Honeywell?
Sorry... you've probably thought of most of this already.
LZ-TLT From Germany, joined Apr 2001, 431 posts, RR: 0
Reply 2, posted (12 years 7 months 3 weeks 4 days 7 hours ago) and read 2232 times:
No rants intended, but it seems to me, Condit is speaking in streamlined diplomatic language, so the things he sais don't match the truth about what's going on. So, an attempt to translate it in normal language might sound like that:
"It's on the list... It's not on the top,"
"This is wishful thinking. Maybe someday(or never), but definitively NOT now"
"The truth is we are constantly evaluating strategic opportunities,"
"What's this crap you ask me about?" or "I don't know anything about it"
Jwenting From Netherlands, joined Apr 2001, 10213 posts, RR: 17
Reply 4, posted (12 years 7 months 3 weeks 3 days 22 hours ago) and read 2201 times:
European defense spending is at an alltime low and dropping.
There's little sales to expect in the next decade or so, most likely less than the investment Boeing would need to do to make those sales.
Therefore it's better NOT to try to sell...
With the German AF comitted to Eurofigter and A400, Brittain to Eurofighter and C-130J (no Boeing product), the Netherlands Norway Denmark and Belgium working hard to dismantle their entire defense operations, France as usual contemplating only French products, and the rest out of funds to purchase anything (or already having decided for the next decade) there's simply nothing to sell.
The only markets still buying military hardware in quantity are southeast Asia and Africa...