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jonewer

Bae Sells Airbus Share

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The wings are coming off the economy.

Its no longer 'plane' sailing, there's a lot of 'turbulance' coming. They better 'gear' up for a hard 'landing'. Just when they were certain things were 'Taking Off' again.

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All we need to do is rebrand ourselves as European then we can bask in the manafacturing sucess of Germany. To be honest with a lot of industry and economic activity I couldn't give a monkeys whether it is a fatcat here or abroad that is getting rich, neither help me. Half these industries end up with subsidies anyay.

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http://news.bbc.co.uk/2/hi/business/4885426.stm

Thats the final nail in the coffin of British aircraft manufacture..... oh how the mighty has fallen.

Also, another 135,000 manufacturing jobs are now at risk.

Rubbish, I work for BAE and we still manufacture aircraft, Airbus is not the be all and end all of BAE. Infact as regards to BAE's Aircraft manufacture its small fry. Air Systems (the Military aircraft division in the UK) employes many more people than are involved with Airbus.

Edited by stormy

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Rubbish, I work for BAE and we still manufacture aircraft, Airbus is not the be all and end all of BAE. Infact as regards to BAE's Aircraft manufacture its small fry. Air Systems (the Military aircraft division in the UK) employes many more people than are involved with Airbus.

Stormy,

I'd be interested to know why the Board have decided to sell this division for £3bn - its obviously a strategic move for BAE.

Do you know what they intend to invest the £3bn in ? Do you think they are going to expand the defence side, which in my mind would be a good idea ?

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THe UK was always a reluctant partner in Airbus and frankly our aviation industry is a national embarassment. When did the UK last make a world class plane? TSR2 perhaps.

The UK is too small to make world class aircraft and thankfully the Europeans stepped up to the plate with Airbus - just imagine if they had not. Every flight we take to go on business or vacation would be on a boeing. Go to seattle to see what the economic benefits are for Washington State.

As for UK plc, at least we have the financial services industry and all those creative, honest, moral, value adding people who make us feel proud....

;-)

Edited by bpw

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Rubbish, I work for BAE and we still manufacture aircraft, Airbus is not the be all and end all of BAE. Infact as regards to BAE's Aircraft manufacture its small fry. Air Systems (the Military aircraft division in the UK) employes many more people than are involved with Airbus.

"Aircraft manufature is small fry"

One by one our industries are being worn away to nothing. As the final bits get sold off, people rationalise by saying things like"its small fry" or "we still manufacture aircraft".

Well it is small fry now but it should'nt have got this way!!!

Also the French will move some manufacturing operations to France. It is inevitable. And don't think that Air Systems is safe. It will go the same way.

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air travel has no future.

military yes. commercial. give it 20 years and nope. it'll be banned.

its killing us and all thet international jet setting is a whole mighty waste of fuel.

it wont go on for much longer. esp if climate change starts to bite.

they are smarter than we think.

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they are smarter than we think.

I tend to agree. I just can't believe the era of cheap, mass air travel will last much longer. In ten years' time (not long in the life of the aircraft industry) the business could be very different. In fact I *hope* it will be very different, because the current situation is insane for a variety of reasons, and we'll soon be able to find much better use for that energy than hoiking chubby chavs to Benedorm and slightly skinnier backpackers to Australia.

Selling up now is probably very shrewd in the medium term. Much though I love the new flagship A380 as an example of what can be achieved, it has dinosaur written all over it... though I suppose it's always possible that the future might be fewer, larger aircraft flying less frequently. But that's still bad news for an industry built on mass air travel.

Andrew McP

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THe UK was always a reluctant partner in Airbus and frankly our aviation industry is a national embarassment. When did the UK last make a world class plane?

The Comet was the first civilian jet plane in the world, unfortunately it then started to resemble qualities of an actual comet, a burning fireball diving across the sky.

We can thank Tony Benn for shagging up our involvement with Airbus, we used to own nearly half of Airbus until Benn sold up for purely dogmatic reasons, we were then forced to buy back a much smaller stake at a much higher price when they realised what a muppet he had been.

BAE want to persue the US defense market and it's absolutely massive compared to the civilian jet market, hopefully this will also help in terms of technology transfer for the JSF.

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Stormy,

I'd be interested to know why the Board have decided to sell this division for £3bn - its obviously a strategic move for BAE.

Do you know what they intend to invest the £3bn in ? Do you think they are going to expand the defence side, which in my mind would be a good idea ?

Heh, well I am not on the board but from a company point of view, both within and without the Military and Defence business has always been core to BAE, we have never really from a corporate point of view had a long term strategy with regards to civil aircraft (apart from selling it off, downscaling and getting out of it).

The fundemental problem for BAE is a bit deeper though, is core business is defence and the UK and European defence budgets are to be honest tiny, the US is where the big bucks are (so to speak). If they can sell of European interest to turn it into US interest then I think thats the long term strategy. The North American business has been growing very, very quickly some would argue at the cost of European operations. BAE is still for now a British business though.

The Airbus revenue will no doubt be put towards further expansion in the US.

I do personally worry we are slowly and surely pulling out of Airframe manufacture, which is basically because its not generating enough revenue. We still do have Hawk, which is still (for now) a cradle to grave operation for UK manufacture (although we do now licence build in the US and soon India), but the shift is still away from Aiframes. Then of course we are heavily involved in Eurofighter, JSF and the unmanned air vehicle business which is another area the company believes is a growth area.

Technology is key, and the US spends money on it.

I think its always been a case WHEN will BAE sell its stake in Airbus, which is a shame. I am not in 100% agreement that we should be selling it off, especially when its still on the up in my opinion.

Edited by stormy

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Heh, well I am not on the board but from a company point of view, both within and without the Military and Defence business has always been core to BAE, we have never really from a corporate point of view had a long term strategy with regards to civil aircraft (apart from selling it off, downscaling and getting out of it).

The fundemental problem for BAE is a bit deeper though, is core business is defence and the UK and European defence budgets are to be honest tiny, the US is where the big bucks are (so to speak). If they can sell of European interest to turn it into US interest then I think thats the long term strategy. The North American business has been growing very, very quickly some would argue at the cost of European operations. BAE is still for now a British business though.

The Airbus revenue will no doubt be put towards further expansion in the US.

I do personally worry we are slowly and surely pulling out of Airframe manufacture, which is basically because its not generating enough revenue. We still do have Hawk, which is still (for now) a cradle to grave operation for UK manufacture (although we do now licence build in the US and soon India), but the shift is still away from Aiframes. Then of course we are heavily involved in Eurofighter, JSF and the unmanned air vehicle business which is another area the company believes is a growth area.

Technology is key, and the US spends money on it.

I think its always been a case WHEN will BAE sell its stake in Airbus, which is a shame. I am not in 100% agreement that we should be selling it off, especially when its still on the up in my opinion.

I gather from analysts' briefings with BAE that they are looking to make another major acquisition in the US to follow up the United Defense purchase - L-3 Communications has been raised as a possibility.

I quite agree that selling the Airbus stake (assuming it goes ahead) is a questionable decision - it contributed EBITA of GDP273 million last year.

BAE is still for now a British business though.

BAE has no real choice in this - the UK govt still retains a golden share

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air travel has no future.

military yes. commercial. give it 20 years and nope. it'll be banned.

its killing us and all thet international jet setting is a whole mighty waste of fuel.

it wont go on for much longer. esp if climate change starts to bite.

they are smarter than we think.

The price might rise dramatically as the price of oil rises, but it won't just disappear. Fuel and oil costs are about 30% - 35% (type dependent) of the total cost of operating an aircraft. So even tripling the price of oil would only be a 60% increase in operating costs. Larger aircraft are more fuel effecient (in passenger-km terms) so the A380 looks like a good long term bet to me.

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The price might rise dramatically as the price of oil rises, but it won't just disappear. Fuel and oil costs are about 30% - 35% (type dependent) of the total cost of operating an aircraft. So even tripling the price of oil would only be a 60% increase in operating costs. Larger aircraft are more fuel effecient (in passenger-km terms) so the A380 looks like a good long term bet to me.

long term as in 10-15 years. not that long considering the costs.

i just dont see public air travel being available to such a scale in the future.

its 98% rubbish flights. its not about the money. it will be about the environment.

sea travel will increase once more. a few planes would be about. possibly this one, but not like it is now.

boeing will go the same way. no country can go alone on this, as i think the more envoronmtal countries will simply start to ban/cut back incoming flights anyway. 2025.

classic flight quotes:

we do all we can for the environment as a family. we saved cans, walked to the shops once. got energy efficient bulbs. and to reward ourselves we are going on a global tour to see the rain forests of peru etc...

Edited by right_freds_dead

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The Airbus 380 production line is several thousand miles long. (Only the EU could cook up a crazy arrangement like that with special lorries, barges and ships ferrying bits about). The break even number of aircraft sales required is around 250 and they are producing about 1 a month. Airbus has done very nicely cloning all the Boeing airframe shapes so far, until the 380, where Boeing say there is no profitable market. I think if I was BAe, I might be tempted to sell my bit whilst I still can. Remember the Channel Tunnel? Concorde?

LB

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long term as in 10-15 years. not that long considering the costs.

i just dont see public air travel being available to such a scale in the future.

its 98% rubbish flights. its not about the money. it will be about the environment.

sea travel will increase once more. a few planes would be about. possibly this one, but not like it is now.

boeing will go the same way. no country can go alone on this, as i think the more envoronmtal countries will simply start to ban/cut back incoming flights anyway. 2025.

classic flight quotes:

we do all we can for the environment as a family. we saved cans, walked to the shops once. got energy efficient bulbs. and to reward ourselves we are going on a global tour to see the rain forests of peru etc...

You have a strange faith in government to do a serious turn around on the environment. Given that the US won't even force very simple fuel emission standards on cars at the moment, that the government dosen't even think humans have anything to do with global warming the chances of them banning air travel, which is essential to almost every world economy, is less than 1 in a billion.

The Airbus 380 production line is several thousand miles long. (Only the EU could cook up a crazy arrangement like that with special lorries, barges and ships ferrying bits about). The break even number of aircraft sales required is around 250 and they are producing about 1 a month. Airbus has done very nicely cloning all the Boeing airframe shapes so far, until the 380, where Boeing say there is no profitable market. I think if I was BAe, I might be tempted to sell my bit whilst I still can. Remember the Channel Tunnel? Concorde?

There are already 159 orders for the A380 and the plane hastn't even had it's first paid passenger flight yet, I think you are being a little hasty.

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boeing will go the same way. no country can go alone on this, as i think the more envoronmtal countries will simply start to ban/cut back incoming flights anyway. 2025.

Never going to happen. A government policy of banning air travel will be about as popular and feasible as local authorities licensing rental propeties.

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Never going to happen. A government policy of banning air travel will be about as popular and feasible as local authorities licensing rental propeties.

today it is. tomorrow when the new tides are lapping into norfolk and colder summers.

opinions will change like the weather.

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159 orders won't break even. And, it'll take more than ten years to deliver them.

And, dont forget BAe certainly picked the right time to unload Rover, didn't they?

Who knows? Only time will tell.

LB

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The Airbus 380 production line is several thousand miles long. (Only the EU could cook up a crazy arrangement like that with special lorries, barges and ships ferrying bits about). The break even number of aircraft sales required is around 250 and they are producing about 1 a month. Airbus has done very nicely cloning all the Boeing airframe shapes so far, until the 380, where Boeing say there is no profitable market. I think if I was BAe, I might be tempted to sell my bit whilst I still can. Remember the Channel Tunnel? Concorde?

LB

In no way does Airbus 'clone' Boeings airframes. Airbus has been very innovative in concepts like modular design, flight deck commonality, materials, and fly by wire. Criticize the EU, sure, but Airbus is nothing but a spectacular success given its origins. In the 1970s, Boeing described the new Airbus group as a ramshackle group of second-rate European aircraft manufacturers. By 2002, they were being outsold by them. And Boeing describing the A380 as having no market is just what you'd expect them to say given the failure of their 747-Advanced program to win any orders. The break even is 250, they have sold 159, and bear in mind the 747 has sold 1000+ units since its launch. The Americans don't see a use for big aircraft in their own domestic market, so they arrogantly assume the market doesn't exist at all. Clearly the A380 is designed for the Asian market.

Its very sad that BAE are pulling out of Airbus. If they think putting all their eggs into the North American defence market is a better use of the capital then fair enough. Airbus is a very politically influenced company and without any British ownership, the jobs and manufacturing will ultimately slowly move to France and Germany.

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In no way does Airbus 'clone' Boeings airframes. Airbus has been very innovative in concepts like modular design, flight deck commonality, materials, and fly by wire. Criticize the EU, sure, but Airbus is nothing but a spectacular success given its origins. In the 1970s, Boeing described the new Airbus group as a ramshackle group of second-rate European aircraft manufacturers. By 2002, they were being outsold by them. And Boeing describing the A380 as having no market is just what you'd expect them to say given the failure of their 747-Advanced program to win any orders. The break even is 250, they have sold 159, and bear in mind the 747 has sold 1000+ units since its launch. The Americans don't see a use for big aircraft in their own domestic market, so they arrogantly assume the market doesn't exist at all. Clearly the A380 is designed for the Asian market.

Its very sad that BAE are pulling out of Airbus. If they think putting all their eggs into the North American defence market is a better use of the capital then fair enough. Airbus is a very politically influenced company and without any British ownership, the jobs and manufacturing will ultimately slowly move to France and Germany.

There are strategic importances to the UK, The french have just poured millions in where i work and whats more they are prepared to cough up more in the presence of a good business case (done via profit holding capex of course :) ). We are about to go mainstream work load with Airbus.

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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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