Thursday, November 16, 2023

Boeing Dominates Orders In Dubai; Airbus Rebounds After Emirates Engine Rift

HARRISON MILLER
 11/16/2023

Airbus on Thursday finally landed a 15-jet order from Emirates airline after a publicized rift over engine issues earlier in the week. Dow Jones rival Boeing has so far dominated the order book at the Dubai Airshow. Boeing stock rallied more than 6% so far this week through Wednesday's close.

Emirates, Airbus Agree To Order

Airbus (EADSY) on Thursday sealed a $6 billion deal with UAE-owned Emirates for 15 additional A350-900 aircraft. The new-order backlog for Emirates — the largest airline in the Middle East — to 65 A350s, the airline announced.

"We will work closely with Airbus and Rolls-Royce to ensure our aircraft deliver the best possible operating efficiency and flying experience," Sheikh Ahmed bin Saeed Al Maktoum, chairman and CEO of Emirates said in the announcement. The airline committed to $58 billion in orders for 110 additional planes at the Dubai Airshow so far.

During negotiations on Tuesday, Emirates airline had signaled it would hold off on any new Airbus A350 orders, the AP reported.

Tim Clark, president of Emirates, hinted the engine supplied by Rolls-Royce was defective in comments to journalists at the airshow and criticized its high maintenance costs, saying it is "not doing what we want."

"If the engine did what we wanted it to do and Rolls-Royce knows what we want it to do, and so does Airbus, then we would reenter it into the assessment for our fleet," Clark said.

Clark told reporters Emirates was prepared to order between 35 and 50 jets if Rolls-Royce improved engine durability and maintenance costs, Reuters reported.

Emirates airline is the world's largest operator of Airbus A380 superjumbo aircraft. Airbus ended production on the double-decker jet and stopped deliveries in 2021. However, Emirates plans to keep flying the A380 - potentially until the early 2040s - and will start phasing out the aircraft in the 2030s.

Emirates on Wednesday signed a series of deals worth $1.5 billion to maintain its A380 fleet and improve the lifespan of the aircraft, Simple Flying reported. This year, the airline began deploying refurbished A380s through its $2 billion internal retrofitting program. All 67 A380s assigned for maintenance will return to service by 2024.

Airbus Orders


On Wednesday, Airbus reached a provisional order with Ethiopian Airlines for 11 A350-900 jets. The deal includes an option to purchase six additional aircraft. It brings Ethiopian Airlines' orderbook for the A350 to 33 planes.

Ethiopian Airlines currently operates a fleet of 20 A350-900s and is Africa's largest A350 customer.

The plane maker secured an order for 30 additional A220-300 aircraft from airBaltic on Monday. The order increases that airline's total order book to 80 jets, making the Latvian airline the largest A220-300 customer in Europe.

Boeing Lands Ethiopian Airlines Deal

Ethiopian Airlines agreed Tuesday morning to order 11 Boeing (BA) 787 Dreamliner jets and 20 737 MAX airplanes, which included an option to buy 15 additional Dreamliners and 21 extra 737 MAXs. The deal marks the largest purchase of Boeing airplanes by a company based in an African country, Boeing said during the announcement.

Ethiopian Airlines CEO Mesfin Tasew said the order enables the airline to modernize and increase its fleet to support the company's growth plan.

The airline has more than 80 Boeing jets in its fleet and touts the largest fleet of Dreamliners in Africa. The new 737 order marks a healing of relations between the two companies, after an Ethiopian 737 MAX crashed in March 2019 and killed everyone on board. The crash grounded Boeing planes worldwide, due to Boeing design flaws playing a key role in that accident, and in another involving Indonesia's Lion Air airlines a year earlier.

"We have checked and confirmed that the design defects of the aircraft have been fully corrected by Boeing and we have renewed our confidence in the aircraft," Tasew told Bloomberg.

Dubai Order Frenzy

At Monday's start of the Dubai show, Emirates airline announced a $52 billion order for 95 of Boeing's widebody jets. Emirates is the world's largest operator of Boeing 777 aircraft. The order included 55 Boeing 777-9s, 35 777-8 jets and five 787 planes, bringing Emirates' total 777x order backlog to 205 planes and its 787 backlog to 35 jets, respectively. Emirates currently has nearly 150 777 jets in its fleet, according to Boeing.

The airline ordered 202 GE9X engines to power the additional 777X aircraft. Emirates expects the first 777-9 to join the fleet in 2025 from its previous order for 115 units. The additional jets from Monday's order should arrive in 2035. Emirates expects deliveries for the 777-8 in 2030.

Meanwhile, FlyDubai announced a plan to purchase 30 Boeing 787-9 Dreamliners, marking the first order for widebody aircraft. The airline currently operates a fleet of 79 aircraft made up entirely of 737s, with an order backlog of 137 Boeing 737s. FlyDubai plans to use the 787s to open new routes and increase capacity on its existing offerings. The order is valued around $11 billion, the AP reported.

Additionally, SunExpress, a joint venture between Turkish Airlines and Lufthansa, committed to purchasing up to 90 Boeing 737 aircraft, according to a Monday announcement. The SunExpress agreement includes an order for 28 737-8s, 17 737-10 models and an option to purchase up to 45 additional 737 MAX planes.

Boeing Stock

Boeing stock faded 1.3% early Thursday, erasing its slight gain from Wednesday. BA stock remains up 4.8% for the week, after rallying Monday Monday on the Dubai orders and reports China is considering its own jet commitment.

Boeing shares are testing resistance at their 200-day line and trading above their other key moving averages. Boeing stock jumped 9.6% so far this year through Wednesday's close.

Airbus, which trades in American depositary receipts (ADRs) under the ticker EADSY, slipped 1% Thursday morning after a slight dip Wednesday. EADSY stock is 19.6% this year and approaching a 36.73 entry in a double-bottom base.

Air Lease (AL), which provides jet leasing and fleet management services, eased early Thursday. Shares rose 1.8% Wednesday after adding 2.4% Tuesday.

You can follow Harrison Miller for more stock news and updates on X/Twitter @IBD_Harrison

Russian arms makers kept to low profile at Dubai Airshow

Wed, November 15, 2023

2023 Dubai Airshow


By Alexander Cornwell

DUBAI (Reuters) - Russian arms makers appear to have been kept to a low profile at this week's Dubai Airshow, underscoring how the United Arab Emirates (UAE) has sought to balance its ties with the West and Moscow.

Unlike past shows, Russian participation has been limited to the very end of the outdoor area where state-arms makers are exhibiting inside their own pavilion rather than in the main hall.

"We have been put a bit away, outside the main pavilion," said a Russian arms industry executive, who declined to be named as they were not authorised to speak to the media.

The executive said they did not know why Russian firms had apparently been deliberately kept away from the main exhibition area where companies like U.S. firm Lockheed Martin are present.

Still, an aerobatics display of Russian Su35S fighter jets went ahead, the TASS news agency reported on Monday.

Rostec, United Aircraft Corp and Almaz-Anty are among the Russian firms participating at the show this week.

A representative for the Dubai Airshow, a major biennial commercial and defence industry showpiece, did not immediately respond to emailed questions on the Russian participation.

Russian arms makers have in past used the Dubai event to showcase their firepower, with executives often claiming they were gaining market share in a region traditionally close to the U.S. At the last show in 2021, Russia displayed a Sukhoi Su-75 Checkmate prototype internationally for the first time.

The UAE, a Gulf Arab power, has not adopted Western sanctions imposed on Russia over its invasion of Ukraine, and has resisted U.S. pressure to break links with Moscow.

Inside the Russian pavilion, combat gear and models of fighter jets and combat helicopters are on display this week.

The Russian executive said military delegations from the Middle East, Africa, Asia and the Americas had visited the pavilion so far. He declined to say which countries.

Outside the Russian pavilion, a Russian KA-52E combat helicopter is on show next to a Russian IL-76MD-90AE military transport aircraft and a RVV-MD2 missile for stealth fighter jets.

U.S. Air Force aircraft on show at the week-long event have been placed at the opposite end of the outdoor display area.

Russian state arms makers participated in February at a major arms fare in Abu Dhabi, the UAE capital, where they were similarly kept separated from the main exhibition area.

(Reporting by Alexander Cornwell; Editing by Mark Potter)

Russian arms industry banks on Dubai defense fair to show viability

Elisabeth Gosselin-Malo
Tue, November 14, 2023



DUBAI, United Arab Emirates — Tucked away outside, at the very end of the Dubai Airshow’s static display of aircraft, the Russian pavilion of suppliers makers spanned a large portion of the floor plan here.

This setting was markedly different from Moscow’s displays at recent defense fairs, where the regime’s state-owned companies came practically empty-handed and kept a relatively low profile.

Banking on the event to market its full range of weapons, including those used in the brutal invasion of Ukraine, Russia’s outdoor setup placed helicopters and air-to-air guided missiles at center stage.

One prominent presence was the KA-52E combat helicopter, of which at least 58 units have reportedly been destroyed or damaged by Ukrainians, according to the Dutch open-source intelligence website Oryx. As part of the Russian helicopter stand, the X-69 precision strike cruise missile, designed to be employed by the Su-57 fifth-generation fighter, was shown for the first time internationally, according to the manufacturer.

A total of five Russian agencies exhibited here, including Almaz-Antey with mockups of its Viking surface-to-air missiles, Rostec with the small-scale Pantsir-S1M self-propelled, anti-aircraft missile system, Roscosmos marketing the Federal Space Program Khrunichev Center, and Rosoboronexport.
Where’s Rosoboronexport’s Argument-2?

Rosoboronexport had planned to unveil its own spin on an anti-drone gun at the airshow. Dubbed the Argument-2, the company markets the weapon as capable of destroying the wildly effective first-person-view (FPV) drones used by Ukrainian forces on the front lines. The drones are named after their modus operandi of a simple, forward-looking video feed that allow operators to fly explosive payloads near targets for detonation.

But as of Tuesday, the new system was nowhere to be seen at the Rosoboronexport stand. Asked about the absence, a company representative at the show declined to comment.

Experts have placed the number of FPV-type drones flying in Ukraine “in the many thousands per month,” Sam Bendett, research analyst at the U.S.-based Center for Naval Analyses, told Defense News.

Ukrainian forces have reportedly used the weapons in the heavy fighting around Avdiivka, a battle that has inflicted the heaviest casualties on Russian invaders in 2023, according to the U.K. Ministry of Defense.

“I think the value for Russia publicizing here is to promote and demonstrate sustainability and self-sufficiency, that it can produce technology like this on its own as the war drags on, whether that capability is accurate or not,” Matt McCrann, chief executive of DroneShield, an Australia-based competitor in the counter-drone market, said.

Throughout the Ukraine war, the United Arab Emirates has walked a fine line by choosing to remain largely neutral, maintaining close ties to Russia while also providing humanitarian aid to Kyiv.

Last March, Emirati presidential adviser Anwar Gargash said in a statement on social media that the Gulf country “believes that taking sides would only lead to more violence” and that the government prioritizes encouraging “all parties to resort to diplomatic action.”


Flying taxis braced for takeoff at Dubai Airshow

Talek HARRIS and Mumen KHATIB
Wed, November 15, 2023 

Archer Aviation displayed its Midnight electric vertical take-off and landing (eVTOL) flying taxi is at the Dubai Airshow this week (Giuseppe CACACE)

Flying taxis have been a sci-fi fixture for decades, but one operator says they are finally close to reality, first in the United States and then the United Arab Emirates and India.

"What we used to think of as science fiction is now science fact," Billy Nolen, Archer Aviation's chief safety officer, told AFP at the Dubai Airshow on Wednesday.

"This is happening, it is real, and you will see this in the market in 2025."

Reports of futuristic aircraft ferrying passengers over cities -- and their car-choked roads -- have been cropping up for years, evoking images of 1960s cartoon "The Jetsons".

Yet regulatory approval from the US Federal Aviation Administration for Archer's Midnight, a four-passenger, electric-powered vertical take-off and landing (eVTOL) aircraft, is expected as soon as 2025.

That will trigger "almost concurrent" certification in the UAE, said Nikhil Goel, chief commercial officer at Archer, whose major backers include Mubadala, an Emirati sovereign wealth fund.

UAE flights are expected to start in 2026 on two initial routes: from Dubai airport to the upmarket Palm development, and Abu Dhabi airport to the city-centre Corniche.

"We expect the demand to be more than we can even handle. The pricing will be relatively premium at the outset," said Goel.

"But then over time, we'll deploy hundreds of aircraft in the UAE (which) will also lower the price considerably."

At the same time, flights will launch in New Delhi, Mumbai and Bangalore, Goel said, calling India "a really, really big market for us".

- 'Fully zero emissions' -

Test flights for Archer's Midnight are currently taking place in California, and rival firm Joby has performed its first experimental journeys in New York.

The Midnight has a dozen propellers -- independently wired and powered, to minimise the risk of a "catastrophic" failure -- and a wing, allowing it to glide in the event that it can no longer stay aloft.

It will be able to fully recharge in the six or seven minutes that it takes to switch passengers between trips, and has a current maximum range of about 160 kilometres (100 miles) at about 240 kilometres per hour (150 mph).

Flying the aircraft is straightforward, said Goel, who insisted that a 12-year-old in a simulator could learn it in 20 minutes.

Flights will be booked as ride shares, and will initially cost about $4-5 per passenger mile before dropping to half that in about two or three years, Goel added.

With flying taxis plying existing helicopter routes -- and theoretically safer, cheaper and more environmentally friendly than helicopters -- there is significant room to scale up, the company says.

"We have designed this business case to operate in urban environments, say from the airport to city centre," said Golen, the chief safety officer.

"It's fully zero-emissions, fully sustainable, it is eco-friendly, it has about 100 times less noise signature than a conventional helicopter.

"So it's very neighbour-friendly as well."

th/dcp



UAE president visits Dubai Air Show as Russian arms company shows attack helicopter used in Ukraine
JON GAMBRELL
Updated Wed, November 15, 2023 


DUBAI, United Arab Emirates (AP) — The leader of the United Arab Emirates toured the Dubai Air Show on Wednesday as a sanctioned Russian arms supplier displayed an attack helicopter used in its war on Ukraine, highlighting his country’s continued ties to Moscow despite Western sanctions targeting it.

Sheikh Mohammed bin Zayed Al Nahyan toured the show with his brother, Sheikh Mansour bin Zayed Al Nahyan, a vice president and deputy prime minister of this autocratic country of seven sheikhdoms.

They stopped by a stand for EDGE, an Emirati defense company, where Sheikh Mohammed signed a drone in front of onlookers before attending a meeting there.

Outstanding on the runway, Russian pilots sat inside a KA-52 attack helicopter as it was pulled down the runway at Al Maktoum International Airport. Those helicopters have been repeatedly used in Ukraine and its manufacturer, Russian Helicopters, is sanctioned by the U.S. Treasury.

Inside a Russian pavilion on the runway, far away from the indoor stands of other airlines and suppliers, onlookers picked up and racked an AK-19 assault rifle on display. Others look at miniature drones and other equipment used by Moscow. Russian pilots associated with the manufacturer walked the halls of the inside displays in their flight suits.

Staff on hand at the pavilion referred questions to a spokesperson who did not respond to a request for comment by The Associated Press. The U.S. Embassy in Abu Dhabi referred questions to Washington, which did not immediately respond to queries. The U.S. military also has a HIMARS missile system, the type used with great success by Ukraine, on display at the opposite end of the runway at the show.

Russia had a similar display at the International Defense Exhibition and Conference in February that did not include attack aircraft. Russian money continues to flood into Dubai’s red-hot real estate market, in part by some who have fled Moscow over the war.

Daily flights between the Emirates and Moscow provide a lifeline for both those fleeing conscription and the Russian elite. The U.S. Treasury has expressed concerns about the amount of Russian cash flowing into the Arabian Peninsula country.

Meanwhile Wednesday, passenger numbers at Dubai International Airport this year will eclipse the passenger figures for 2019, showing the strong rebound in travel after the coronavirus pandemic and lockdowns that grounded aircraft worldwide, a top official said.

The airport, the world's busiest for international travel and home of the long-haul carrier Emirates, has had 64.5 million passengers pass through its cavernous concourses through the third quarter of this year. That puts it on track to reach 86.8 million passengers for the full year, which would exceed its 2019 figure of 86.3 million passengers. It had 66 million passengers last year.

The airport's busiest year was 2018, when it had 89.1 million passengers.

“So for the end of the year, current predictions, 86.8 million, a little bit shy of the pre-pandemic numbers," Paul Griffiths, Dubai Airports CEO, told The Associated Press in an interview at the Dubai Air Show. "But actually, hopefully, by the end of the year, we may be able to raise that forecast.”

He added: “I think now because we’ve got the full network with 250 destinations, 95 airlines and 105 countries, that’s why we’ve been able to recover so strongly.”

Hartsfield-Jackson Atlanta International Airport remains the busiest passenger airport overall.

Through the third quarter, Dubai's main airport handled 308,000 total takeoffs and landings. India, long a key route for Emirates' East-West travel strategy, led all countries in destinations, followed by Saudi Arabia, Pakistan, the U.S. and Russia. Emirates and other airlines in the United Arab Emirates, an autocratic federation of seven sheikhdoms, have continued to fly to Moscow even during Russia's war on Ukraine.

Israel's war on Hamas in the Gaza Strip also has slowed traffic to and from Ben Gurion International Airport in Tel Aviv for Dubai, which established direct flights after the UAE diplomatically recognized the country in 2020. Numbers also remain lower with flights from China, which used to be a major source market for Emirates and Dubai's tourism industry.

“Because we have such a diversified network across so many different countries, we’ve got pretty strong demands. And when we have one or two traffic flows which go down, it’s always compensated by something that recovers more strongly,” Griffiths said. "For example, the Far East, we’re still seeing traffic from China in very low numbers. But as that resurges, I’m absolutely sure the numbers will be boosted by that.”

Griffiths' announcement comes during the Dubai Air Show at Al Maktoum International Airport at Dubai World Central, the city-state’s second airfield some 45 kilometers (28 miles) away from Dubai International Airport. While used by commercial airlines when Qatar hosted the 2022 FIFA World Cup, the second airport that opened in 2010 largely sees cargo and private aircraft flights.

During this year's show, Emirates has announced a $52 billion aircraft purchase with Boeing Co., while its sister airline FlyDubai bought another $11 billion of aircraft from Boeing. Airbus on Wednesday announced the sale of 11 additional A350-900s to Ethiopian Airlines, though the European manufacturer has yet to announce a major sale at the show.

“This, I think, has been the greatest air show of all time," Griffiths said. "The mood is great. The confidence is great. The quality of the show is great. I think the outlook for aviation here in Dubai has never been brighter.”
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Sheikh Mohammed bin Zayed Al Nahyan, the president of the United Arab Emirates and the ruler of Abu Dhabi, signs an HT-100 drone at the display of the Emirati military company EDGE while attending the Dubai Air Show in Dubai, United Arab Emirates, Wednesday, Nov. 15, 2023. (AP Photo/Jon Gambrell)

UAE, Korea Aerospace Industries enter talks for KUH-1E helicopter buy
Awad Mustafa
Wed, November 15, 2023 



DUBAI, United Arab Emirates — The United Arab Emirates is negotiating the purchase of South Korean helicopters, with the aim of signing a deal by year’s end, according to an official with the manufacturer.

The Emirati military is seeking an undisclosed number of KUH-1E helicopters from Korea Aerospace Industries, Cho Seok Joon, a senior manager with the company’s rotorcraft division, told Defense News during the Dubai Airshow, which runs Nov. 13-17.

The KUH-1E is an export version of the twin-engine KUH-1 Surion. The former can carry 18 people, including two pilots, whereas the latter can accommodate 18 total. The UAE is seeking a maritime variant.

“Instead of the gun present in the KUH, it is equipped with a radar,” Cho noted.

A spokesperson with the Emirati Defence Ministry told Defense News the country is currently evaluating the aircraft.

“At the ministry, we have several layers of tests for all equipment. Once it’s complete, we give our verdict,” the representative said.

The Surion can perform military transport and airfreight missions, among other functions.

The export variant’s power comes from a pair of 1,855-shaft-horsepower GE T700-701K turboshaft engines. It can reach a maximum speed of 147 knots (169 mph) and has a maximum takeoff weight of 19,200 pounds.


Turkey and UAE cozy up over drone, missile cooperation

Elisabeth Gosselin-Malo
Tue, November 14, 2023 

BIROL BEBEK

DUBAI, United Arab Emirates — Turkey and the United Arab Emirates, which have found themselves at odds over recent years, are indicating a rapprochement is underway as a result of negotiations over major defense projects.

Following the Arab Spring — pro-democratic protests and uprisings across the region that started in 2011 — the two countries differed on several geopolitical issues. For instance, during the 2017 Qatar diplomatic crisis, when the UAE decided to cut political and economic ties with the Gulf nation, Turkey opted to support Doha.

However, in the last year they have focused on strengthening bilateral ties through agreements in the defense and technology sectors, among others. In October, the chairman of the Emirati-owned defense company Edge Group visited Turkey to meet with some of the country’s major defense stakeholders.

“The Turkish market has done a great job in recent years at establishing a good ecosystem of defense players, similar to what the UAE has achieved and continues to work towards,” Faisal Al Bannai, chairman of the board of directors at Edge, told Defense News in an interview at the Dubai Airshow this week.

The executive said the company is banking on cooperation rather than competition with some of the biggest players in Turkish defense, with the aim of exploring acquisition and joint development programs focused on drones, missiles and subsystems.

“I don’t see the world as black and white; it is big enough for us all [defense companies] to exist in it. Sure, we can compete in some areas — that’s fine and normal — but there are also instances where it is better and more logical to cooperate,” Al Bannai said.

As an example, he cited the UAE’s purchase of Turkish-made Bayraktar TB2 drones, without disclosing the exact quantity.

“We are also in discussions, for instance, with Baykar to integrate our missiles on some of their drones and to possibly acquire the TB3 model eventually,” Al Bannai said, referring to the TB2 and TB3 drone manufacturer.

This deal could be similar to the one Edge has with General Atomics Aeronautical Systems, which announced on Nov. 13 it agreed to integrate Edge-made precision-guided munitions and guided glide weapons onto the MQ-9B SkyGuardian drone.

Haluk Bayraktar, who leads Baykar, also confirmed ongoing talks over the firm’s platforms.

The TB3, the naval variant of the TB2, took its first flight late last month, according to the manufacturer.

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