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New York Times Business News - June 12,
These are the most popular stories from the New York Times' business pages. These stories have not been verified and we cannot vouch their accuracy. Israel is reportedly preparing an attack on Iran soon, according to officials from the United States and Europe. This could delay the efforts of the Trump administration in brokering a deal that would stop Iran's progress towards building a nuclear weapon. A U.S. official stated on Wednesday that the Trump administration is reviewing a security agreement between the United States and Britain to provide Australia with nuclear subs. The agreement is meant to "align with the president's America First Agenda". Sean Duffy, secretary of transportation on Wednesday, endorsed the calls for the inspector general to audit the air safety protocols in Washington DC following a fatal crash between a civilian flight and a helicopter. Officials told senators that the Federal Aviation Administration (FAA) and the Army will soon sign a policy to prevent such accidents. Robert F. Kennedy Jr., Health Secretary, named eight doctors and scientists, including four that have expressed their opposition to vaccinations in some form, on Wednesday. They will replace about half of the experts he dismissed from the Centers for Disease Control and Prevention. (Compiled Bengaluru Newsroom)
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Airbus can hit delivery goal despite delays, jetmaking CEO says
Airbus' CEO for its core planemaking division said that the company is "cautiously optimistic" about its ability to meet its target of 820 deliveries by 2025 despite bottlenecks which have seen nearly 40 airframes waiting in its factories for engines. Christian Scherer stated that while overall supply chains "improved considerably," bottlenecks still exist in the supply of CFM single-aisle engines and cabin interiors of wide-body jets. Lavatories have also been added to the list of delays. "We haven’t changed our delivery guidance." Scherer warned reporters not to extrapolate from monthly figures, after a recent series of monthly deliveries that were down compared to the previous year. CFM's engines are gradually increasing in output. We haven't changed our outlook because we think we'll get the engines between now and year-end," he said. "It is a gradual rise - we are a bit behind at the moment, but we remain cautiously optimistic that it will be possible". CFM is owned by GE Aerospace, France's Safran, and GE Aerospace. It supplies more than half the engines for the Airbus A320neo, the most popular family of Airbus aircraft. CFM competes with Pratt & Whitney, which offers alternative engines. CFM is the exclusive supplier of engines for the Boeing 737 MAX. "We have almost 40 gliders in our system," Scherer stated, referring to the nickname of the planemaker for planes which are otherwise completed but cannot be delivered to airlines because they are waiting for their engines. These engines are sold separately. CFM was not available for immediate comment. Top executives at CFM have stated that they've seen improvements in their own supply chain, and are poised to recover after a slow start of the year. Scherer stated that Airbus is on track to achieve its goal of building 75 A320neo family jets per month by 2027. Analysts are cautious in predicting when the goal will be achieved. "On single aisle (A320neo family) we are on the right track to achieve that (75 per month) and are just about to cruise past 60 (per month). We are on track to reach the 60s," Scherer stated. Airbus rarely talks about its monthly production targets in public. It has dropped the interim goal of 65 jets per month by 2023. Scherer spoke at a briefing on Airbus's market forecasts and product offerings ahead of next week's Paris Airshow. He said that the demand for aircraft remains "very high." (Reporting and editing by Jamie Freed; Tim Hepher)
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Airbus revises up 20-year jet demand forecast despite trade tensions
Airbus updated its forecasts for aircraft demand over the next two decades on Thursday. The company told investors and suppliers that the industry is expected to weather the current trade tensions. The European planemaker predicted that the industry, which it and its U.S. competitor Boeing dominate, would deliver 43,420 jets commercial between 2025-2044. This is an increase of 2 percent from its rolling 20-year projection issued one year ago. This includes 42,450 passenger aircraft, an increase of 2% over the previous forecast. And 970 freighters, which is a 3% rise. Airbus has maintained its original projection of an average annual increase in air traffic of 3.6%, despite cutting half a point from its forecasts for trade growth to 2.6%. It also reduced its projected global GDP growth to 2.5%. Antonio Da Costa (Vice President for Market Analysis and Forecast) told reporters that there was "certainly some turbulence" due to recent geopolitical events and the trade situation. The early signs are encouraging, but it is still early. The aerospace industry is being impacted by U.S. Tariffs introduced by U.S. president Donald Trump, the threat of retaliation by the European Union and wild swings between punitive duties traded by the U.S. U.S. officials and Chinese officials reached an agreement on Tuesday to roll back restrictions on dueling and restore the trade truce. Airbus officials stated that the latest forecasts assume base tariffs of 10 percent imposed by Trump's administration on the majority of imports will remain in place for some time, as opposed to the greater disruptions threatened by higher punitive duties. Da Costa stated that air transport has often proven to be resilient to shocks because it is closely linked to the economy, and the growing number of middle class families with disposable incomes. Airbus CEO Guillaume Faury joined a chorus from U.S. leaders of industry in warning about the damage that a tariff war could cause. Airbus has increased its demand forecasts for single-aisle aircraft like the A320neo and 737 MAX that account for four of every five deliveries by 2%. Airbus expects to deliver 34,250 over the next 20 years. Of these, 56% will be extra capacity. Airbus has revised its wide-body passenger plane deliveries forecast by 3%, to 8,200 aircraft. Gulf carriers have been driving demand in this part of the long-haul market. (Reporting and editing by Emelia Sithole Matarise; Reporting by Tim Hepher)
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Bloomberg News: Adani aims to IPO airport units by 2027 and accelerate $100 billion capex pace.
Bloomberg News reported Wednesday that billionaire Gautam Adani’s group plans to list Adani Airports by 2027 as part of its growth plan, which requires $100 billion in investments across all businesses over the coming years. Reports citing anonymous Adani Group executives said that the unit would be spun-off and listed in March 2027. Adani Airports has eight airports in India. This includes the Navi Mumbai International Airport located on the outskirts India's financial center, and which is expected to be operational very soon. The report also stated that the company has doubled its capital expenditure plan, and expects to spend $100 billion over the next five to six year period instead of the previous decade. Last week, a group of international banks invested $750 million in the airport unit. A portion of the funds will go towards refinancing debts of $400 million. Adani Group didn't immediately respond to an inquiry for comment.
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After fatal crash, US Army will curtail VIP flights near the Pentagon
A senator announced on Wednesday that the U.S. Army would curtail VIP helicopter flights near the Pentagon following safety concerns raised after the fatal January 29 collision between a Black Hawk helicopter and an American Airlines passenger plane near Reagan Airport. Senator Jerry Moran (a Republican senator who chairs a subcommittee on aviation) told reporters the Army would limit training missions near Reagan Washington National Airport, and the number of senior military officials and defense officials that could use helicopters as transport. After a close call on May 1, which forced two civilian aircraft to abort their landings, the Federal Aviation Administration barred the Army in early May from priority or training transport flights around Pentagon. Acting FAA administrator Chris Rocheleau told reporters that the FAA and the Army are currently in negotiations to establish rules for future military flights around commercial planes near Reagan. Rocheleau stated that they were working closely with the Army. On Wednesday, the FAA, National Transportation Safety Board (NTSB) and Army provided senators with a briefing on Washington airspace. Moran stated that the Army had been ferrying three-star and higher generals before the 29th of January, but now that the Army has resumed flights only a few senior officials and the Defense Secretary will be eligible. Moran stated that "the number of flights and Army flights have been really limited in that airspace. Potential airspace is also very limited." This, he said, was a positive development. He added that the Army's "air safety protocols" are not as strict as those of commercial aircraft. Sean Duffy, Transportation Secretary, had previously criticised the use of helicopters in generals' convenience. Duffy stated, "Get a Suburban and drive. You don't have to take a helicopter." Another question is whether a key safety system known as ADS-B, or automatic dependent surveillance-broadcast, is working on most Army helicopters. Moran stated that testing has shown the system does not work on other military aircraft, and ADS-B did not operate in the helicopter which crashed on January 29, 2009. ADS-B transmits the location of an aircraft using advanced surveillance technology. The FAA gave an exemption to the military in certain circumstances in 2019. The FAA in The use of the device on flights was made mandatory by March around Reagan.
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Australia and US to review Biden's submarine pact
Richard Marles, Australia's Minister of Defence, said that his government will work closely with the United States as President Donald Trump's Administration conducts an official review of the AUKUS defense pact. In a press release, a spokesperson from Marles stated that it was only natural for the administration to want to review this major undertaking. This includes progress and delivery. Australia has committed to spending A$368 billion (£239.3 billion), over a period of three decades, on AUKUS, Australia’s largest ever defence project, with the United States, Britain and other countries, in order to build and acquire nuclear-powered subs. Australia's Anthony Albanese, the Prime Minister of Australia, is expected to meet Trump in Canada next week. The two will discuss tariffs as well as a request by the United States that Australia increase its defence spending from 2.5% to 3.5%. Albanese has previously stated that defence spending will rise by 2.3%. He declined to commit to a U.S. target and said Australia would focus on its capability needs. AUKUS called for Australia to pay the U.S. $2 billion in 2025, to boost the submarine shipyards of the U.S. and to speed up the production of Virginia-class submarines that were lagging behind. This would allow up to three U.S. subs to be sold to Australia starting 2032. Britain and Australia are jointly building a new AUKUS-class submarine that is expected to enter service in 2040. The UK recently finished a review on AUKUS. The results have not been made public, but the government announced this month that it would increase the size its fleet of nuclear-powered attack subs. Marles' spokesperson stated that AUKUS will grow the U.S. defence industry and create thousands of manufacturing jobs. John Lee, an Australian Indo-Pacific specialist at Washington's conservative Hudson Institute, said that the Pentagon review is "primarily an audit" of American capabilities and whether they can afford to sell five nuclear-powered submarines if they are not meeting their own production targets. Lee added that the Australian government's low defence spending, and its ambiguity about how it could contribute to a Taiwan contingency was also a factor. $1 = 1.5380 Australian Dollars (Reporting and editing by Chris Reese, Jamie Freed and David Brunnstrom)
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Trans Mountain CEO: Canada shouldn't rush to sell TMX pipeline
Mark Maki said that Canada should not sell the newly extended Trans Mountain oil pipe at a Canadian conference on Wednesday. The Canadian government has stated that it is not interested in owning the pipeline for the long term. It spent C$34 Billion ($24.9 Billion) to complete an expansion which was opened last spring. Maki stated on Wednesday that he believed the government could recover its investment. However, it would receive a higher price for the asset by waiting until Trans Mountain had more time to prove its worth and certain uncertainties relating to capacity and usage have been resolved. Maki stated that "it's ultimately up to them." "The only thing we've said to the government consistently is, 'don’t hurry.' The use of the newly-expanded pipeline that carries oil from Alberta up to British Columbia's West Coast, where it can be shipped to overseas markets by ship, has been slower than expected. The reason for this is that oil companies are reluctant to pay the higher fees Trans Mountain charges customers to cover the construction cost overruns. This raises questions about Ottawa's capacity to attract a buyer and the pipeline's revenue-generating ability. Maki told reporters on the sidelines of Wednesday's conference that the 890,000-barrel-per-day pipeline has been operating at approximately 85% capacity in the second quarter. Trans Mountain predicted earlier that the pipeline would be used at 96% every year, starting in 2025. Maki stated that March was the best month of the year so far, with a pipeline just below 90% full. Maki stated that the Trans Mountain pipeline had achieved its goal to open up Asian export markets for Canadian crude. He said that he expected that the continued demand for Canadian barrels from this continent should support long-term usage of the pipeline. Trans Mountain is exploring short- and longer-term optimization projects to increase pipeline capacity by between 200,000 and 300,000 barrels a day. Maki believes that the government should wait to sell the pipeline until capacity improvements have been finalized. The hearing is scheduled to take place in late 2025. It will aim to resolve the dispute over the tolls between the pipeline operator, and the oil shipping customers. $1 = 1.3667 Canadian dollars
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US lawmakers attend Paris Airshow amid national security, tariff and tariff concerns
The lawmakers said that more than 20 U.S. legislators are expected to attend the Paris Airshow in next week's due to concerns over potential American aerospace tariffs, national security issues and lawmakers. Senators Jerry Moran, Jeanne Shaheen, and a bipartisan delegation previously unknown will be led by 11 U.S. Senators. This includes Senate Armed Services Committee chair Roger Wicker as well as a dozen U.S. Governors and over a dozen House members, headed by Representative Sam Graves who is the chairman of the House Transportation Committee. As China continues its aggressive war against democratic countries, and Russia continues its unjust war in Ukraine the U.S. needs to partner with its allies to promote economic partnership and bolster national security, said Moran. The Republican senator is the chair of a Senate Aviation Subcommittee. Airbus and Boeing both boost U.S. investment. Virginia Governor Glenn Youngkin, and Arkansas Governor Sarah Huckabee Sanders were among the officials who attended to make their case for U.S. aerospace companies to increase investment. This push comes after global aerospace companies and U.S. Airlines warned that new tariffs on commercial aircraft, jet engine and part imports could threaten air safety or cause unintended consequences such as higher ticket prices. Shaheen stated that "our manufacturers are suffering severe disruptions due to the tariffs imposed by this administration and our allies question our commitment to mutual defence." She added that "it is especially important for this multipartisan delegation to reaffirm America as a reliable and stable partner, and that our abilities remain unmatched. And that's what we intend do." The show will also feature Transportation Secretary Sean Duffy, and the Acting FAA Administrator Chris Rocheleau. After President Donald Trump announced tariffs against trade partners, the industry is already facing 10% tariffs on almost all imported parts and planes. The Commerce Department launched an investigation last month called Section 232 to examine the risks imported goods pose to U.S. security. This could lead to even higher tariffs for imported planes and engines, as well as parts. Airlines and manufacturers are lobbying Trump for a return to the tariff-free regime of the 1979 Civil Aircraft Agreement. The U.S. sector benefited from a $75 billion trade surplus each year. The agreement states that parts must be approved by the Federal Aviation Administration in order to qualify for tariff-free status. (Reporting and editing by Diane Craft in Washington, David Shepardson from Washington)
Spanish Minister says private power companies slow to share information about blackouts
Sara Aagesen, Spain's Minister of Energy, urged private electric companies to share information faster to determine the cause of the worst blackout ever to strike Spain and Portugal.
The cause of the power outage that left 60 million people without electricity in two European countries has not been determined, and the blame-game has increased.
Aagesen, who was in Nice, France for a U.N. Conference, told reporters that information arrived quickly at first. "Now, information is arriving in bits and pieces much slower."
She admitted that the information needed was more detailed, and at times more complex.
She said, "But I insist. I continue to ask for this information as soon as possible to identify the causes and to implement the necessary steps."
The Spanish energy ministry leads one of the investigations into the events that took place on April 28, which sent investigators, from Spain's cybersecurity and Intelligence services, to the premises of private energy companies to gather information.
A spokesperson for the energy ministry declined to comment on what Aagesen meant.
Aelec, the lobby group for Spain's major electricity companies, including Iberdrola, Endesa, and other utilities, has not responded to our request for comment.
Last week it was reported that private companies were cooperating in the investigations.
It said that "it is absolutely false" that the government was withholding or delaying information in response to inquiries about the recent blackout.
PROBES and Finger-Pointing
A Spanish court is also investigating the possibility that a cyber-attack was responsible for the blackout. Separate investigations are being conducted by Spanish legislators.
Red Electrica, the Spanish grid operator, insists that the transmission grid they manage was operating without any problems before the blackout.
Beatriz Corredor (chairwoman of Redeia's parent company) blamed last week some conventional power plants (including nuclear, combined cycle and hydroelectric plants) for failing to maintain an appropriate voltage in the power system on that day. Corredor did not say that this was the cause of the blackout.
Investigators examine excessive voltage in the grid as a possible cause of the loss of production.
Aelec claimed that Corredor's remarks caused confusion and prevented an objective technical assessment. Reporting by Pietro Lombardi. Edited by Aislinn laing and Emelia sithole-Matarise.
(source: Reuters)