Newsdesk — Commercial Aviation

MDC Record Profit

McDonnell Douglas has reported a record operating profit for the first quarter of 1996, the increase led by a strong performance from its military aircraft division. Overall, the company returned a $US347m operating profit for the first three months of the year, 18.4\% greater than the first quarter of 1995. The net profit for the period was$US198m, a 25% increase on the previous year. Of the operating profit, military aircraft contributed $US250m (up 19%); missiles, space and electronic systems $US58m (down 1.7\%); financial services$US20m (up 67%); and commercial aircraft $US19m (up 58\%). The company’s revenue for the three-month period was$US3.17bn, a 5% decrease on 1995, of which military aircraft were responsible for $US2.039bn and civil aircraft$US428m. The reduction in overall revenue was largely due to a substantial drop in MDC’s commercial aircraft segment, from $US917m to$US428m, although this was largely covered by increases in other areas, especially military aircraft. During the first three months of 1996, the company delivered four MD-80s, three MD-90s and three MD-11s of which two MD-90s and two MD-11s were accounted for as operating leases with minimal revenue recorded at the time of delivery. At the beginning of April this year, MDC had a firm backlog worth $US22.54bn. Employment stood at 63,194.

New Snecma/P&WC Engine

France’s SNECMA and Pratt & Whitney Canada have signed a Memorandum of Understanding to jointly develop and market a new turbofan engine in the 12,000 to 16,000 lb (53.8 to 71.7 kN) thrust class. The engine is intended to power regional airliners in the 70 to 90 passenger category, a market segment which is currently subject to numerous design studies by manufacturers around the world. Between them, SNECMA and P&WC civil engines have accumulated over 190 million flight hours with more than 750 airline customers.

The prototype Canadair Global Express ultra long-range business jet in the final stages of assembly. Bombardier says everything is on schedule for the first flight in September, with first customer deliveries in late 1997. The Global Express will have a range of 6,500 nm (12,040 km) with four crew and eight passengers and will be able to cruise at up to Mach 0.88. (Bombardier)

Embraer Employee Agreement

Employees of Brazilian manufacturer Embraer have overwhelmingly approved a new agreement with the company that improves productivity and achieves significant labour cost savings by reducing the salaries and working hours of some. Embraer was privatised in 1994 and since then has been looking at ways of improving efficiency and profitability. The agreement is significant because it reflects a high degree of co-operation from two major unions representing Embraer’s metalworking and engineering staffs. Although some jobs have been lost, many more have been saved as a result of the new terms. The main points of the agreement are the loss of 350 administrative and support positions and the reduction of all production personnel’s salaries by 10% over the next six months. The weekly work schedules of production personnel will be reduced in proportion to the salary cuts and in return, the manufacturer will establish an employee pension plan this year. The agreement has saved 800 administrative and support positions and is seen as a major step towards Embraer returning to profitability.