Latest news with #Aboulafia
Yahoo
4 days ago
- Business
- Yahoo
Will Paris Air Show Signal Shift In Aerospace Trade? Analyst Flags EU Tariff Risks, Order Delays
On Friday, BOfA Securities analyst hosted Richard Aboulafia, a partner at AeroDynamic Advisory, to discuss expectations for the upcoming 2025 Paris Air Show. The analyst says that regarding news of potential 50% EU tariffs, Aboulafia warned that the Air Show could foreshadow how future international negotiations might unfold. The analyst notes that the EU might draw lessons from recent agreements in China and the Middle East, which mainly included aerospace and defense products. Don't Miss: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — this is your last chance to become an investor for $0.80 per share. Nancy Pelosi Invested $5 Million In An AI Company Last Year — Here's How You Can Invest In Multiple Pre-IPO AI Startups With Just $1,000. Nevertheless, the analyst writes that given the EU's own substantial aerospace and defense industry, which it aims to protect, U.S. aerospace and defense interests might become a point of contention rather than an incentive in these discussions. Regarding Boeing Company (NYSE:BA), Aboulafia views recent deals in the Middle East and China as setting a precedent for other nations' trade negotiations, suggesting orders will be held back as bargaining chips, noted the analyst. The analyst writes that, for both Airbus SE (OTC:EADSY) and Boeing, Aboulafia doesn't foresee many airlines placing large new orders, primarily due to a lack of new aircraft programs and existing backlogs exceeding 10 years for their most popular models. Further, the analyst noted that, as previously disclosed, Aboulafia doesn't anticipate any major new commercial aircraft program unveilings due to ongoing supply chain issues and global macroeconomic constraints. In the defense sector, Aboulafia expects numerous companies to compete for subsystem roles on programs like NGAD/the F-47 and CCA. Additionally, Aboulafia anticipates an outsized presence of unmanned aerial systems at the show, predicting a focus on lower-tech, expendable variants rather than highly sophisticated systems, says the analyst. Read Next: Hasbro, MGM, and Skechers trust this AI marketing firm — Invest before it's too late. 'Scrolling To UBI' — Deloitte's #1 fastest-growing software company allows users to earn money on their phones. You can invest today for just $0.30/share with a $1000 minimum. Photo: Shutterstock Send To MSN: Send to MSN UNLOCKED: 5 NEW TRADES EVERY WEEK. Click now to get top trade ideas daily, plus unlimited access to cutting-edge tools and strategies to gain an edge in the markets. Get the latest stock analysis from Benzinga? This article Will Paris Air Show Signal Shift In Aerospace Trade? Analyst Flags EU Tariff Risks, Order Delays originally appeared on
Yahoo
14-05-2025
- Business
- Yahoo
Turning Qatari 747 into Air Force One could cost $1 billion and take years, experts say
Converting a Qatari-owned 747 jet into a new Air Force One for President Donald Trump would involve installing multiple top-secret systems, cost over $1 billion and take years to complete, three aviation experts told NBC News. They said that accepting the 13-year-old jet would likely cost U.S. taxpayers hundreds of millions of dollars over time, noting that refurbishing the commercial plane would exceed its current value of $400 million. The project might also not be completed by the end of Trump's term in 2029, at which time the plane is expected to be handed over to Trump's presidential library foundation. Richard Aboulafia, an analyst and consultant on commercial and military aviation, said he thought turning the Qatari jetliner into Air Force One would cost billions and take years. 'You're taking a 747, disassembling it, reassembling it, and then jacking it up to a very high level,' said Aboulafia, a managing director at AeroDynamic Advisory, a consulting firm. The White House did not immediately respond to a request for comment. Aviation experts refer to Air Force One as the most complicated aircraft on the planet. The plane is meant to serve as a secure communication center in the sky — including command and control of nuclear weapons — and allow the president to issue orders to military and government agencies in the event of war or other emergency. Experts said the idea made no financial or practical sense given that Boeing is already deep into a multiyear effort to convert two 747s to replace current Air Force One planes. They said that the contract for refurbishing the Qatari 747 would likely go to Boeing as its original manufacturer. 'Since you're also disassembling and reassembling the jet for security reasons, you're probably going to go with the people who know it better,' Aboulafia said. 'If you have to rip the plane apart, that's more of a Boeing job.' Some of the work could be done by L3 Harris, which specializes in this kind of work. The work would likely be done in Greenville, Texas. Qatari officials have said that the possible transfer of an aircraft for use as a new Air Force One plane is under consideration but no final decision has been made. The Qatari jumbo jet would have to be effectively dismantled, part by part, to ensure there were no listening devices, spyware or other security vulnerabilities that could allow foreign powers to eavesdrop on the president's plane. It would then have to be fitted with costly, sophisticated systems for secure government communications, midair refueling, missile defense, countering electronic jamming and protecting against electro-magnetic pulse attack. There would likely need to be quarters added for White House medical staff and the Secret Service. Installing the new systems could push the project into the 2030s, according to Aboulafia, who said that equipping the plane with midair refueling capability alone would be 'enormously time-consuming.' The White House has said the jet would be handed over to Trump's presidential library foundation by the end of his term, in January 2029. That would presumably require the removal of all the sensitive government equipment installed on the aircraft. Trump could override current Air Force security rules but usually employees working on presidential aircraft or similar sensitive projects need a high-level security clearance, known as a 'Yankee White' clearance, according to an industry member who asked not to be named. In the past, Boeing has struggled to find enough workers with the necessary security clearances to do the work. In 2018, the Air Force issued a contract to Boeing to convert two 747s to eventually serve as new Air Force One aircraft, for $3.9 billion. In 2019, the Pentagon estimated that the total estimated cost of building, equipping and testing the planes would be higher, at about $5.3 billion. The project has been plagued by delays and cost overruns. The jets were supposed to be ready by last year but may not be delivered until 2029. At a congressional hearing on May 8, Darlene Costello, principal deputy assistant secretary of the Air Force for acquisition, technology and logistics, told lawmakers that the new planes could be ready by 2027 by reducing some of the requirements for the aircraft. In 2022, Boeing's then-CEO, Dave Calhoun, suggested the firm should not have accepted the Trump administration's terms in 2018 on the new Air Force One. For Boeing, converting the Qatari jetliner under a new contract could be good news as it has lost money on the fixed-cost contract it agreed to during Trump's first term, as it has had to absorb major cost overruns, Aboulafia said. 'This would be a real relief for Boeing,' he said. This article was originally published on
NBC News
13-05-2025
- Business
- NBC News
Turning Qatari 747 into Air Force One could cost $1 billion and take years, experts say
Converting a Qatari-owned 747 jet into a new Air Force One for President Donald Trump would involve installing multiple top-secret systems, cost over $1 billion and take years to complete, three aviation experts told NBC News. They said that accepting the 13-year-old jet would likely cost U.S. taxpayers hundreds of millions of dollars over time, noting that refurbishing the commercial plane would exceed its current value of $400 million. The project might also not be completed by the end of Trump's term in 2028. Richard Aboulafia, an analyst and consultant on commercial and military aviation, said he thought turning the Qatari jetliner into Air Force One would cost billions and take years. 'You're taking a 747, disassembling it, reassembling it, and then jacking it up to a very high level,' said Aboulafia, a managing director at AeroDynamic Advisory, a consulting firm. The White House did not immediately respond to a request for comment. Aviation experts refer to Air Force One as the most complicated aircraft on the planet. The plane is meant to serve as a secure communication center in the sky — including command and control of nuclear weapons — and allow the president to issue orders to military and government agencies in the event of war or other emergency. Experts said the idea made no financial or practical sense given that Boeing is already deep into a multiyear effort to convert two 747s to replace current Air Force One planes. They said that the contract for refurbishing the Qatari 747 would likely go to Boeing as its original manufacturer. 'Since you're also disassembling and reassembling the jet for security reasons, you're probably going to go with the people who know it better,' Aboulafia said. 'If you have to rip the plane apart, that's more of a Boeing job.' Some of the work could be done by L3 Harris, which specializes in this kind of work. The work would likely be done in Greenville, Texas. Qatari officials have said that the possible transfer of an aircraft for use as a new Air Force One plane is under consideration but no final decision has been made. Dismantled, part by part The Qatari jumbo jet would have to be effectively dismantled, part by part, to ensure there were no listening devices, spyware or other security vulnerabilities that could allow foreign powers to eavesdrop on the president's plane. It would then have to be fitted with costly, sophisticated systems for secure government communications, midair refueling, missile defense, countering electronic jamming and protecting against electro-magnetic pulse attack. There would likely need to be quarters added for White House medical staff and the Secret Service. Installing the new systems could push the project into the 2030s, according to Aboulafia, who said that equipping the plane with mid-air refueling capability alone would be 'enormously time-consuming.' The White House says the jet would be handed over to Trump's presidential library foundation by the end of his term in January, 2029. That would presumably require the removal of all the sensitive government equipment installed on the aircraft. Trump could override current Air Force security rules but usually employees working on presidential aircraft or similar sensitive projects need a high-level security clearance, known as a 'Yankee White' clearance, according to an industry member who asked not to be named. In the past Boeing has struggled to find enough workers with the necessary security clearances to do the work. 'A real relief for Boeing' In 2018, the Air Force issued a contract to Boeing to convert two 747s to eventually serve as new Air Force One aircraft, for $3.9 billion. In 2019, the Pentagon estimated that the total estimated cost of building, equipping and testing the planes would be higher, at about $5.3 billion. The project has been plagued by delays and cost overruns. The jets were supposed to be ready by last year but may not be delivered until 2029. At a congressional hearing on May 8, Darlene Costello, principal deputy assistant secretary of the Air Force for acquisition, technology, and logistics, told lawmakers that the new planes could be ready by 2027 by reducing some of the requirements for the aircraft. In 2022, Boeing's then-CEO, Dave Calhoun, suggested the firm should not have accepted the Trump administration's terms in 2018 on the new Air Force One. For Boeing, converting the Qatari jetliner under a new contract could be good news as it has lost money on the fixed-cost contract it agreed to during Trump's first term, as it has had to absorb major cost overruns, Aboulafia said. 'This would be a real relief for Boeing,' he said.
Daily Tribune
21-04-2025
- Business
- Daily Tribune
Tariffs could lift Boeing and Airbus plane prices even higher
Commercial plane prices, already lifted in recent years due to pandemic supply chain shocks, are poised to climb further as Boeing and Airbus are buffeted by trade tariffs. "Compared with 2018, prices for commercial jets have risen by around 30 percent," an aviation expert told AFP on condition of anonymity. The American and European aerospace giants have grappled with higher expenses for primary materials such as titanium, components and energy, as well as overall labor cost pressures. To resolve a labor strike, Boeing late last year agreed to a new contract with its Seattle-based machinist union that lifted wages by 38 percent over four years. Just months earlier, Spirit AeroSystems, a major supplier to both Boeing and Airbus, reached an agreement with similar wage increases. Richard Aboulafia, managing director at consultancy AeroDynamic Advisory, said items that have inflated "at a particularly high rate" include castings, forgings and "anything titanium... especially since all that Russian capacity has been cut off from the US and, to a lesser extent, from Europe." Aboulafia estimates prices for materials and equipment have risen 40 percent since 2021. That's before Trump's 25 percent tariffs on steel and aluminum, which are used in planes. "It's kind of ironic, raw materials were not a problem, but Donald Trump is determined to make them a problem," Aboulafia said. Inflation in aviation has been accelerating, and "that's only going to get worse with these tariffs that are being imposed," agreed John Persinos, editor-in-chief at Aircraft Value News. "These tariffs are disastrous."
Khaleej Times
20-04-2025
- Business
- Khaleej Times
Tariffs could lift Boeing and Airbus plane prices even higher
Commercial plane prices, already lifted in recent years due to pandemic supply chain shocks, are poised to climb further as Boeing and Airbus are buffeted by trade tariffs. "Compared with 2018, prices for commercial jets have risen by around 30 percent," an aviation expert told AFP on condition of anonymity. The American and European aerospace giants have grappled with higher expenses for primary materials such as titanium, components and energy, as well as overall labour cost pressures. To resolve a labour strike, Boeing late last year agreed to a new contract with its Seattle-based machinist union that lifted wages by 38 percent over four years. Just months earlier, Spirit AeroSystems, a major supplier to both Boeing and Airbus, reached an agreement with similar wage increases. Richard Aboulafia, managing director at consultancy AeroDynamic Advisory, said items that have inflated "at a particularly high rate" include castings, forgings and "anything titanium... especially since all that Russian capacity has been cut off from the US and, to a lesser extent, from Europe." Aboulafia estimates prices for materials and equipment have risen 40 per cent since 2021. That's before Trump's 25 per cent tariffs on steel and aluminum, which are used in planes. "It's kind of ironic, raw materials were not a problem, but Donald Trump is determined to make them a problem," Aboulafia said. Inflation in aviation has been accelerating, and "that's only going to get worse with these tariffs that are being imposed," agreed John Persinos, editor-in-chief at Aircraft Value News. "These tariffs are disastrous." What's more, the newer generation of planes, such as the Boeing 737 MAX and 787 Dreamliner and the Airbus A321neo, can command premium prices thanks to their lower fuel consumption. Listed prices a 'fiction' The impact of tariffs is not reflected in the companies' stale official pricing literature. Boeing has not updated its figures since 2023, while Airbus' catalogue is untouched since 2018. "Catalogue prices were a complete work of fiction," Aboulafia said. "You got 50 per cent off for showing up dressed nicely." Airbus decided to abandon the use of catalogue prices "a long time ago" because they "were not closely correlated to the final price, which was based on each specific contract in terms of plane configuration and detail," the company said. The aerospace companies will often negotiate additional services such as plane support or training at a discounted level when aircraft are delivered, said the expert who requested anonymity. Such deals make the official listed price less meaningful, they added. Contracts for new planes typically include adjustment clauses for inflation, while pricing can also be tweaked if deliveries are delayed. Since the contracts are usually denominated in dollars, there can also be allowances for swings in exchange rates. Boeing told AFP that it evaluates price based on production costs and other market factors, but does not discuss the details publicly since they pertain to competition. Both Boeing and Airbus currently have a substantial backlog of plane orders that will keep them occupied through the end of the decade. But that strong demand has not in itself boosted pricing much. "It's a very competitive situation," said the expert. "The two companies fight for every transaction and that impacts pricing." Most airlines opt to do business with both Airbus and Boeing. "Before Covid, Boeing and Airbus competed for a market where prices were really lower, maybe even too low," said Manfred Hader of consultancy Roland Berger. But airlines have been able to afford more expensive planes in the post-lockdown period, where there has been strong travel demand, boosting ticket prices and airline profitability, Hader said. In February, Japanese carrier ANA ordered 77 planes from Boeing, Airbus and Brazilian firm Embraer, providing updated catalogue prices that show an increase from earlier levels. The order priced Boeing's 787 Dreamliner at around $386 million and the 737 MAX at $159 million, compared with $292 million and $121.6 million in 2023, according to AFP calculations. It priced the Airbus A321neo at around $148 million compared with the $129.5 million in the 2018 catalogue.
