Big Companies, Big "Rumors"
Boeing and BAE In Merger Talks?...
With all of the obstacles Boeing has faced over the last year or so, it seems interesting to note some reports that indicate that the company may join forces with a rival manufacturer. The Sunday Times of London broke the story when it reported that senior bankers held talks on behalf of Boeing and BAE Systems, the British company that owns 20 percent of Airbus. The talks were held last autumn, before BAE issued a profit warning in December. The paper reports that these and additional discussions centered on a possible merger that would create a commercial aviation and defense conglomerate valued at $32 billion. [more] For now, the talks seem to be on hold, although both sides still seem interested in hammering out a deal. A combination of Boeing and BAE would create a multinational firm with a workforce of 300,000 people and annual sales of about $72 billion. BAE currently has operations in 30 states and a U.S. workforce of 22,000.
...While Boeing Shuffles Employees...
While Boeing has not officially confirmed merger talks, the company's Wichita facility offered unpleasant news to 45 employees in the form of 60-day layoff notices. In Seattle, about 620 workers also received layoff notices last week. At almost the same time, 100 workers -- mostly mechanics -- were temporarily rehired for work at Boeing's military modification division. Boeing plans to eliminate about 5,000 positions this year after it cut about 30,000 jobs nationally in 2002. [more] Few of these additional cuts have been targeted for Wichita, which endured the loss of 4,800 employees last year.
...And Airbus Remains Cautious For 2003
Across the pond, things appear somewhat better for Boeing's main rival, Airbus. Nevertheless, the European powerhouse is treading carefully and is not terribly optimistic for 2003, as the prospect of a war with Iraq continues to loom. "Frankly, I think 2003 will be an extremely difficult year," Airbus president Noel Forgeard said at an annual news conference in Paris. [more] Forgeard said that Airbus is holding its goal to produce 300 airliners this year but said an aggravated economic slump may bring that estimate down. However, Forgeard said Airbus is expected to have limited exposure to an unstable U.S. market and plans to deliver 50 planes to American customers this year. Keeping with this confidence, the company is on average raising prices by 2.5 percent for 2003.