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Monday, July 28, 2008

Farnborough Watch – Sukhoi, P&W, BRSA, ATR/MAS

Sukhoi Pegs Success
Over the next 20 years, Sukhoi expects to capture 15 to 17 percent global market share for the 50- to 120-seat aircraft, for which it is offering its Superjet 100. It has upped its sales expectations from 800 aircraft prior to taking on Alenia Aeronautica as a partner to 1040 in the next two decades, especially in view of the new Western customers it gained at Farnborough. Related Story
The manufacturer is also considering a 130-seat version of the Superjet and, following Embraer’s lead, a business version, as well as a freighter. The business variant, requiring additional range and an interior provided by partner Superjet International, will likely be the next model given the increase in high net worth individuals in its home market and the focus western manufacturers have on Russia.

Sukhoi Releases Results
Sukhoi Civil Aircraft also released its 2007 audited consolidated financial results, prepared according to international financial reporting standards, resulting in a net profit totaling $3.6 million. It also announced assets increase 2.2 times in 2007 and as of December 31, 2007 totaled $675.3 million, while equity capital increased by 3.4 times and totaled $5.5 million and net financial debt increased by 2.6 times and as of December 31, 2007 totaled $472.9 million.
“Assets increase in 2007 by 2.2 times reflects company’s intensive growth,” said Maxim Grishanin, senior vice president on economics and finance. “Today the company is dynamically gaining investment appeal, solidifying its production potential. This is quite typical to design, pilot production and certification stages of such a sophisticated and high-tech product as the Sukhoi Superjet 100 aircraft.”
It acknowledged direct state financial support is essential for the launch of such an investment intensive project as the Sukhoi Superjet 100. But the company had already gained experience in attracting financial resources in the open financial market. In March 2007, SCAC placed the first 10-year bond for five billion rubles. The increased net financial debt was primarily gained with the help of long-term financial resources, securing further aircraft design and development funding as well as developing the company’s production potential.
“It’s worth mentioning that the weighted average cost of the credit portfolio decreased in 2007 from 8.16 percent to 7.33 percent, at that the weighted average period of credit portfolio was prolonged from 5.8 up to 9.6 years,” said the company. “Today SCAC’s financial strength ratio should be definitely improved. Still, the success of our project directly depends upon timely investments. The company is intensifying its efforts towards more optimized business financing. Iin 2008 we expect to increase our equity through Alenia Aeronautica’s entry to our registered capital. SSJ100’s Italian partner will acquire 25 percent plus one share.” However, the company has been talking about this impending investment for a few years now.
The SS100 performed it’s maiden flight in Komsomolsk-on Amur only May 19, and upon completion of the first stage factory flight tests, produced the first in-flight hourly fuel consumption rate. Its projection over the cruise mode shows confirming its earlier goals for fuel efficiency.

Sukhoi Debuts Russia's First ‘Paperless’ Aircraft
Siemens PLM Software’s Teamcenter(R) software suite enabled the production of Russia's first internationally-designed and manufactured, paperless aircraft in Sukhoi’s Superjet 100 (SSJ100), which marked its maiden flight on May 19.
The goal for SCAC was to bring all system suppliers into a virtual enterprise on a global platform, implementing the latest design and manufacturing technology, said Siemens. To create this aircraft, Sukhoi and its partners worked within a single master data warehouse enabled with Teamcenter that included all 3D models and related data to completely define and digitally mock up any aspect of the SSJ100. This warehouse, or platform, enabled the company to create Russia's first aircraft from a paperless design process.
Siemens PLM Software's Teamcenter software suite was among key factors in achieving first flight in a fast-paced development program for the SSJ100 regional airliner, said Siemens, adding it helped coordinate the efforts of approximately 1,700 engineers and manufacturing specialists in more than eight locations across the globe.

Pratt Outlines Test Program
The newly renamed PurePower PW1000G demonstrator engine completed its first flights July 11 ushering in a flight test program running through year end. Related Story  The program, for the engine formerly known as the Geared Turbo Fan, will run in two phases with the first phase running for approximately 40 hours on Pratt & Whitney's 747SP flying test bed. After completing phase one, the engine will be shipped to Airbus in Toulouse, France, and installed on an Airbus-owned A340 flight test aircraft.
Phase two, which is scheduled to begin in the fourth quarter and include approximately 75 flight hours, will continue engine performance and operation testing while providing valuable installation and acoustics data.
"As airlines face rising fuel prices and growing environmental pressures, they are watching the development of the PW1000G engine very carefully,” said Pratt & Whitney Vice President Bob Saia “The engine continues to meet or exceed all pre-test targets and we look forward to bringing this value to our customers."

Pratt Turns to Bio Fuels
P&WC is evaluating the feasibility of using "second generation" biofuels that originate from sources that do not compete with human food sources. These could include jatropha and algae derived biofuels, as well as biobutanol to power aircraft engines. Related Story
"Already a leader in green technologies for small aviation engines, we aim to have a fuel-flexible engine and to develop technologies that will allow us to offer aircraft manufacturers innovative and green power solutions," said Walter Di Bartolomeo, vice president - Engineering, P&WC.
The objectives for the four-year project include identifying and assessing appropriate biofuels, studying their effect on engine components such as combustors and fuel systems, developing appropriate technologies and design changes to accommodate them, and conducting tests comparing current jet fuels with first generation ethanol, as well as second generation biofuels.
The alternative fuel project is one of several initiatives announced recently by the governments of Canada and India under a joint research collaboration agreement in the field of science and technology. The Canadian portion is being funded through the International Science and Technology Partnerships Program.
P&WC is managing the project and dedicating resources at its research centers in Longueuil, Quebec and Mississauga, Ontario to look into engine components and materials changes. Infotech Enterprises Ltd. and two major Indian oil companies will share in this effort. Four Canadian institutions, McGill University, Laval University, Ryerson University and National Research Council Canada are also participating, along with the Indian Institute of Technology, Science and Petroleum.
P&WC has previously undertaken extensive research into alternative jet fuel blends using shale and tar sand oil derived products, as well as hydrogen.
"We are very pleased about launching this study of biofuels for small aircraft engines," said Sam Sampath, manager and senior fellow, Combustion Engineering and Emissions Control, P&WC, who is leading the research project. "Our goal is to develop technologies for fuel flexible gas turbine engines, which can operate with a variety of biofuels and mixtures using the same hardware."

Used vs. New
BAE Systems Regional Aircraft said that a number of large airlines concluded that new regional jets offer only marginal improvement over modern, used regional jets – and in some cases less operational capability – but entail significant risk in terms of financial exposure and commitment period. This is at a time of considerable market uncertainty, especially in the regional sector with the strong competition from the low-cost carriers, it added.
During this year BAE Systems concluded Avro RJ lease extensions with Malmö Aviation in Sweden and Blue1 in Finland to add to the deals concluded recently with BA CityFlyer and CityJet of Ireland.
Its most recent deal is with Belgian major carrier Brussels Airlines for the sale and leaseback of three Avro RJs operated by the airline. This deal follows the major transaction concluded in May 2005 under which BAE Systems signed a contract to buy and then leaseback 23 of the airline’s fleet of 26 Avro RJ85/100s. That deal required BAE Systems to acquire the aircraft, in stages, over a five-year period.
This new transaction covers the final three Avro RJ100s which were the last aircraft to be delivered to the airline in 1999 and were the subject of a separate financing structure, which meant that both parties elected to handle these aircraft separately.
To date, BSRA has bought back and re-leased 17 of the original 23 aircraft. The remaining six aircraft will follow this year and in 2009. The three aircraft under the new deal also will be acquired during 2009 and immediately leased back to the airline. This further deal means that the Avro RJ will remain a core part of the Brussels Airlines fleet until at least the middle of the next decade.
The Avro RJ is the backbone of the Brussels Airlines regional fleet that, together with a number of BAe 146s, service an extensive European network linking the important Brussels hub with some 55 destinations in 19 countries. The airline has also deployed some of its BAe 146 fleet into a new Congolese joint venture carrier, Air DC, which is based at Kinshasa. This new airline is operating a feeder service from 10 domestic and African regional destinations into Brussels Airlines’ long-haul routes into the Belgian capital.

ATR Mx Base in Malaysia
MAS Aerospace Engineering (MAE), a wholly owned subsidiary of Malaysian Airline System Berhad (MAS) and the Italian Alenia Aeronavali, a Finmeccanica Company controlled by Alenia Aeronautica, inked a Memorandum of Agreement (MoA) towards the establishment of a Joint Venture in Malaysia.
The proposed MRO will support the future fleet of 15 ATR aircraft that will join two MAS subsidiaries, Firefly and MASwings, as well as other potential operators in the region during its first stage of operations. In the second stage, the joint venture will develop additional business opportunity in the cargo conversions and specialized activities.
The MoA for this Joint Venture, where MAE will be the majority shareholder and fully supported by Avions de Transport Regional (ATR), allows both signatory parties to create a comprehensive aircraft Maintenance and Repair Overhaul (MRO) company.
“This is a significant occasion for MAE, as Aeronavali has more than 50 years of experience in MRO jobs and is an experienced ATR service provider. We can leverage on our collective expertise to continue to offer a high level of safe and secure flight operations. We can also market these services to other airlines at highly competitive costs,” Roslan said.
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