Airbus Factories Sale Thread, Spirit Aerosystems Out Of Running Rating Options

[BOEING777]

http://www.bloomberg.com/apps/news?pid=new...id=aCGiynNPSdjc

Airbus Shelves Plan to Sell Two French Factories

By Andrea Rothman

May 7 (Bloomberg) -- Airbus SAS, the world's largest commercial planemaker, and its parent company shelved a plan to sell factories in France, citing difficult financial conditions.

Airbus and Latecoere SA, the Toulouse, France-based supplier that had initially been chosen to buy two plants in France, have discontinued negotiations, Airbus and parent European Aeronautic, Defence & Space Co. said in an e-mailed statement. Airbus said it still plans to create a separate unit with the plants in Meaulte and Saint Nazaire that had been scheduled for sale.

[BOEING777]

http://www.iht.com/articles/2008/05/07/business/airbus.php

"But analysts were not convinced. "Power 8 is a shadow of what was originally intended," said Howard Wheeldon, a senior strategist at the BGC Partners brokerage firm in London. "It's hard to know what the way forward is."

Wheeldon and others have been critical from the beginning of Airbus's decision to pursue talks only with European bidders, viewing the move as a capitulation to government pressure to make sure that the divested factories, and jobs, remained in the region. Many analysts dismissed MT Aerospace and Latécoère in particular as not having sufficient financial resources or the technology to improve the factories for producing Airbus's next-generation aircraft, the A350-XWB."

[Aurora]

Airbus has failed to sell the factories.
Airbus has failed to make the case for the 10000 job cuts.
Airbus has so far failed to make the case for outsourcing.

"power" 8 appears to be a flop. The company's management knows what it needs to do; however, the political will is lacking. I suspect the only way they'll divest factories in Europe is to sell them to a state owned bank, or an outright transfer to a government, who will assume the risk and absorb the costs.

[rhapsody]

Airbus has failed to sell the factories.
Airbus has failed to make the case for the 10000 job cuts.
Airbus has so far failed to make the case for outsourcing.

"power" 8 appears to be a flop. The company's management knows what it needs to do; however, the political will is lacking. I suspect the only way they'll divest factories in Europe is to sell them to a state owned bank, or an outright transfer to a government, who will assume the risk and absorb the costs.

So based on all these Power 8 failures you would think EADS would have to report all the resulting financial bad news to the public. Hope no one at EADS is selling stock right now before any announcement.

[Aurora]

BusinessWeek has an interesting take on this.

http://www.businessweek.com/globalbiz/cont...age_top+stories

Airbus's Cost-Cuts Don't Fly
Airbus will have to go back to the drawing board.

No, it's not a plane that needs redesigning—it's the European company's increasingly desperate plan to regain its cost competitiveness against Boeing.

On May 7 Airbus's parent European Aeronautics Defense & Space Co. (EAD.PA) confirmed it had halted negotiations to sell two of the planemaker's French factories to Latécoère (LAEP.PA), a French aerospace equipment supplier. Its plan to sell three German factories to other buyers also has fallen apart.

Disposing of the factories was a key element in its push to find billions in cost savings in order to battle the dollar's decline, which has sent costs at its European factories soaring far above those of Boeing (BA). Now that the effort has failed, Airbus will have to contemplate "brutal, radical measures" that could shift thousands of jobs outside Europe to lower-cost countries, says Sandy Morris, a London aerospace analyst with ABN Amro.
. . .
But Airbus clearly must go much further to cut costs. It already has promised to parcel out work on the A350 to China, Russia, and other non-eurozone countries. Now it will almost certainly have to shake up production arrangements for its existing planes such as the A320 and A330. Indeed, Airbus Chief Executive Tom Enders has already hinted at that, saying at a press conference in Berlin on Apr. 24 that the company was considering "supplemental measures" to limit its exposure to the euro.

What kind of measures? Airbus could renegotiate contracts with suppliers, forcing them to shift manufacturing to lower-cost countries, or else find new suppliers. The company would have to compensate suppliers in those cases, but the expense would be far less than the savings it would reap.

Labor unions and some politicians protested when Airbus announced its Power8 plans to sell off factories. But, Morris says, "What's coming now is going to be even more brutal. Power 8 will have been the easy bit."

Good luck. France, Germany, Spain, and the UK have invested large sums of money to keep those jobs at home. These factories--and the work they do--aren't going anywhere soon. IMO, EADS' best bet is relief on the exchange rate and/or a (another) Boeing screw-up on 787 execution. They (i.e., EADS management) simply don't have real control over the most important decisions affecting the company. This is not an indictment of their management, just an acknowledgment that they have to deal with the political realities inherent in cutting costs/employment in these social democratic economies.

[Aurora]

http://www.reuters.com/article/marketsNews...20080630?rpc=44

Sarkozy says opposed Airbus factory sale
PARIS, June 30 (Reuters) - French President Nicolas Sarkozy said on Monday he expressed opposition to the planned sale of a French Airbus factory once proposals to sell similar plants in Germany had collapsed.

Airbus last month called off plans to sell two French plants to Toulouse-based Latecoere SA (LAEP.PA: Quote, Profile, Research, Stock Buzz) shortly after talks to sell three plants in Germany to MT Aerospace AG (OHBG.DE: Quote, Profile, Research, Stock Buzz) collapsed over financing problems, saying the two events were unrelated.

"When I saw that the German factories were not being sold, for reasons of their own, I indicated I was against the closure of Meaulte," Sarkozy said in a television interview, apparently referring to plans to move the northern French factory outside the ownership of Airbus.

Power 4, 5, or 6? Where does this stand now?

[Falcon]

Power 4, 5, or 6? Where does this stand now?

Isn't the updated version supposed to be called Power 8+

[Falcon]

The sale of the site in Laupheim, Germany, from Airbus to Diehl/Thales was closed with effect from 1 October 2008 and all operational business and assets were transferred. This is in line with the announcement made by Airbus on 1 August 2008.

Source: EADS

[Aurora]

http://www.easybourse.com/bourse-actualite...00235190-565815

Wildcat Strikes At Two German Airbus Plants - Company
Thursday November 20th, 2008 / 15h26

BERLIN (AFP)--Staff at three Airbus plants in Germany staged wildcat strikes Thursday over plans by the European jet maker to spin off the factories into a new subsidiary, a company spokesman said.
The work stoppages hit the Varel and Nordenham facilities in northern Germany, coming on the same day as industrial action at a plant in the southern city of Augsburg belonging to the parent company European Aeronautic Defence & Space Co. (5730.FR).
Airbus sought a court injunction against the strikes in Varel and Nordenham.
The company aims to group the three sites with some 6,000 staff at the end of the year in the new EADS unit Premium Aerotec. The works council has called the terms of the deal for employees "unacceptable."
The company has asked staff to contribute to savings of EUR30 million in its operations, amounting to some EUR5,000 a worker.
Labor representatives say they shouldn't bear the brunt of the restructuring program, particularly without any guarantees from the company on jobs at the plants.
The supervisory board of Airbus Germany plans to ink an agreement on the spinoff at a meeting Monday, works council officials said.
An Airbus spokesman declined to confirm the deadline but expressed confidence "that we will be able to reach a deal with the works council soon."

[Falcon]

Airbus SAS, the world’s biggest planemaker, said it reached agreement with unions on the spinoff of three German plants into a new company, Premium Aerotech, and will invest 500 million euros ($641 million) in the sites.
...
Under the accord with labor groups, about 6,000 workers will transfer to the new company, with a guarantee that no jobs will be cut until 2014 at the earliest, the IG Metall union said in an e-mailed statement. No more than a minority stake in the business can be sold until 2012, the union said.

Source: Bloomberg

Very slow but it is happening.