Defense budget gives Boeing boost
President George W. Bush signed into law a $355 billion defense bill on Oct. 23, assuring the armed services of major increases over and above the accelerated military spending since the September 2001 terrorist attacks.
The outlay represents a nearly $20.9 billion increase from the fiscal year that ended Sept. 30, The Wall Street Journal reported. It also clearly marks Boeing as a major contributor to the defense of the United States, including $35 billion in funding for programs either led by or with major content from Boeing.
Asian aviation industry bullish on growth, despite western pessimism
Slightly more than a year after terrorist attacks in the U.S., Asia remains hopeful that air traffic will continue to develop, barring war in Iraq, reported AviationNow.com, the news Web site of Aviation Week & Space Technology magazine. The outlook for Asia’s aviation industry is optimistic, despite the fact that most facilities in Europe and the United States continue to be pessimistic on traffic growth. In the attacks’ aftermath, flights across the Pacific and the Atlantic from Asia were the most affected, with Asians changing their holiday destinations from Europe and the United States to remain in the region, while business travelers adopted a wait-and-see attitude. However, the decline in travel in Asia during the first quarter this year was mild—just 1.5 percent when measured in revenue passenger miles. Signs of better days ahead already are visible with average predicted traffic growth of 5 percent to 10 percent in the region for the first eight months of the year. Aircraft manufacturers Boeing and Airbus are confident that Asia will be the world’s fastest-growing region for traffic, with China leading the way.
EU gives OK to Northrop takeover of TRW
The European Union recently approved Northrop Grumman’s proposed $7.8 billion takeover of TRW Inc., leaving approval by the U.S. Department of Justice as the last remaining hurdle to completing the merger, Defense Daily and Reuters reported. The European Commission said the tie-up would not damage competition in the EU or cause prices to rise. “The one-month investigation confirmed that the merger did not give rise to any competition concerns, as Northrop Grumman will face competition in Europe from a number of European rivals, including EADS, Thales, Matra, BAE Systems, Alenia, Alcatel, and Astrium,” the Commission reported. The merger of two of the largest U.S. suppliers of satellites and sensors has sparked competition worries from the biggest defense contractor, Lockheed Martin.
However, Northrop Grumman recently said it agreed with the Justice Department’s decision not to close the proposed acquisition without giving the federal regulatory agency at least 10 business days’ notice before either its or TRW’s share-holder meetings vote on the deal. The company expects the deal to close by the end of 2002.
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