WSJ : Airbus Sees More than 1,000 A330neo Orders Possible

Airbus Sees More than 1,000 A330neo Orders Possible
Commercial Plane Sales Chief Sees Production to 2030 if Re-Engined

DOHA—Airbus Group NV could sell more than 1,000 of its popular but aging A330 long-range jet should it decide to put modern engines on the plane, the chief salesman for the European company said.

Sales of the A330neo, as the re-engined model is called, could top 1,000 planes and stretch production to 2030, said John Leahy, chief operating officer for customers at the Airbus commercial plane arm. Airbus management is trying to decide whether to pursue the upgrade.

The sales outlook could almost double total production of the A330 that made its debut in 1987. Airbus had sold 1,342 A330s through April.

The European plane maker's market forecast is backed by Steven F. Udvar-Házy, chairman and chief executive officer of Air Lease Corp., a large buyer of Airbus and Boeing Co. BA +0.08% planes. Mr. Házy said Airbus could sell 1,100 to 1,200 of the aircraft over 20 years.

Last month Fabrice Brégier, chief executive of Airbus's commercial airplane unit, said his opinion of the project was shifting from the skepticism he felt earlier this year. "I am probably more optimistic than I was in January," he said.

Airbus still has to decide what engines should power the new plane. Rolls-Royce Holdings RR.LN +0.48% PLC and General Electric Co. GE +0.19% have provided proposals.

Mr. Házy said he'd prefer an engine choice. Having both manufacturers involved would expand the potential airline customer base since carriers have ties to different engine producers.

Airlines would want to get A330neo aircraft from 2018, Mr. Házy said. Production would likely be around 60 to 70 planes a year and then gradually drop, he said. Airbus currently builds 10 A330s a month.

Boeing Co. said an A330neo wouldn't compare well on a per-seat cost basis with its 787-10, the largest model of the Chicago-based plane maker's Dreamliner. The A330neo would be a "small niche" plane, said John Wojick, chief salesman for Boeing's commercial airplane unit.

Mr. Leahy countered that the A330neo would have the same cash operating cost as the Boeing 787-9, the version due to enter service this year which has a similar seat-count to the A330.

Airbus is considering the engine upgrade to revive A330 sales. The backlog of orders at the end of April was only 260 jets, or little more than two years' production at its current rate of 10 aircraft a month.

The two-engine Airbus A330, which seats between 200 and 300 people, is generally used on mid-distance international routes, such as across the Atlantic or around Asia. It doesn't need to fly as far as Boeing's new 787 Dreamliner can or the new Airbus A350 will when it enters service—currently scheduled for later this year. That means the engineering challenge and cost of the project would be much lower than the price of an entirely new plane.

Putting new engines on an existing plane requires extensive engineering work. Modern engines are generally larger than their predecessors, which makes them heavier and changes their aerodynamics.

Celine Fornaro, an analyst at Bank of America Merrill Lynch, estimated that updating the A330 would cost about €2 billion ($2.7 billion) and Airbus could sell up to 700 of the re-engined model. Engine makers pay part of the development bill.

Tony Fernandes, chief executive of Malaysian budget airline AirAsia 5099.KU -2.34% Bhd and a large Airbus customer, has been a vocal supporter of the concept. The company's AirAsia X long-haul unit already operates the current model.

"We are getting close to deciding what to do," Mr. Leahy said.

>>> Outotec share price hike could result from investor expectations of a bid fr

Outotec share price hike could result from investor expectations of a bid from Metso

Investors are expecting Outotec, the Finnish industrial tech company, to be targeted by the Finnish industrial company Metso, according to Arvopaperi. The Finnish language item cited a report by Handelsbanken in which the bank suggested that Outotec’s share price hike is the result of investor expectations of a takeover offer from Metso. However, the bank was not of the belief that Metso would make an now because Metso would want to concentrate on boosting its services business.

Outotec had a market cap of 1.5bn on 30 May.


Source Arvopaperi

FT : It is time for the ECB to act, but more talk is needed too

It is time for the ECB to act, but more talk is needed too

The picturesque town of Sintra has its own microclimate. But the subtropical atmosphere in the hills above Lisbon, where most of the European Central Bank’s top officials gathered last week, was not quite rarefied enough to ignore events at ground zero.
The rise of the anti-establishment vote across Europe, disappointingly weak growth and too-low inflation weighed on the mood at the gathering of central bank governors and leading academics. Some of those present are now back in Frankfurt, where the rate-setters on the governing council this Thursday are expected to unveil measures to stop conditions from worsening.

The need to act now is clear. Mario Draghi warned last week of the threat of a pernicious negative spiral of low inflation and tight credit conditions, which would derail the bloc’s fledgling recovery and destroy the ECB’s credibility to target inflation of close to 2 per cent.
The risk is especially great in the bloc’s weaker members, where, the ECB president acknowledged, lending constraints on cash-strapped businesses threatened to lower inflation further. With inflation in many of these economies close to, or below, zero, a further bout of disinflationary pressures could force more troubled member states into a prolonged bout of Japanese-style deflation. In such circumstances, demand would completely collapse and debt burdens soar.
Crucially, it looks as though Mr Draghi has managed to secure unanimous support for an injection of cheap central bank cash targeted at boosting lending in the periphery. Though the debate on interest rates is more finely balanced, strong support from most of the governing council for cuts is likely.
But even strong hints from officials of a move into negative territory for interest rates, alongside lending support for the bloc’s smaller businesses, have not been enough to quell doubts that it is all too little, too late.
Economists at Goldman Sachs have argued that going boldly below the zero bound – a radical move that neither the US Federal Reserve nor the Bank of England has tried – would have been more effective 18 months ago. Then there was more excess liquidity sloshing around the eurozone’s banking system, all of which would have been subject to the levy that negative interest rates in effect impose.
Neither that, nor the cut to the main refinancing rate, are expected to have much of an impact on the bloc’s economy. There were also murmurings at Sintra that one part of the ECB’s strategy to ease lending constraints on smaller businesses would prove fruitless.
The ECB has long hoped the repackaging of bundles of loans into asset-backed securities would encourage lending to smaller businesses. But with the exception of Adam Posen, formerly of the BoE’s Monetary Policy Committee, the academics at the conference were largely critical of attempts to restart the market for securitisation.
Sir Paul Tucker, the BoE’s former deputy governor, now at Harvard, warned that the ECB’s backing of the market could amount to a fiscal transfer, with the bank left on the hook when things go wrong.
Stephen Cecchetti, an economist at Brandeis University, asked why, if repackaging small business loans was so easy, no one had thought of it before. Mr Cecchetti said that even before the financial crisis, when creators of asset-backed securities were at their most inventive, there was little market for packages backed by SME loans.
Privately, some at the central bank admit that demand is so weak that any real pick-up in lending is doubtful.
So what can the ECB do to counter scepticism?
After more than six months of nothing but jawboning, many have condemned the bank as all talk. Paradoxically, some now think what Mr Draghi has to say on the possibility of quantitative easing will be the most important aspect of this week’s meeting.
“Even a unanimous decision does not mean everyone will . . . be on board for further unconventional measures,” said Nick Matthews, an economist at Nomura. “What will be important for markets is the rhetoric and openness to further action. Where they stand in terms of commitment to doing more will have the most impact.”

FT : Qatar World Cup corruption claims spark calls for re-run of vote

Qatar World Cup corruption claims spark calls for re-run of vote

Fifa president Sepp Blatter is coming under renewed pressure to re-run the vote for the 2022 World Cup after a whistleblower leaked documents revealing $5m of secret payments to help Qatar win its bid to host the tournament.
Mohammed bin Hammam, the Qatari ex-president of the Asian Football Confederation, channelled the payments to football officials in the run-up to and after the vote in December 2010 to win support for his country’s world cup bid, according to the leaked documents published by the Sunday Times.

Qatar’s world cup organisers have always maintained that Mr bin Hammam, who was a Fifa executive committee member at the time of the vote, played no role in its bid campaign.
The Sunday Times alleges some of the payments were made to senior African football officials so they could influence the four African representatives on the Fifa executive committee of 24 members voting in the election.
John Whittingdale MP, who headed an inquiry into allegations surrounding the Fifa vote for the 2018 World Cup, in which England was a bidder, said the latest claims required urgent investigation. “This makes Sepp Blatter’s position almost untenable, given he has been dismissing these rumours for the past three years,” said Mr Whittingdale.
“As for Qatar, if it is now clear that the decision made involved hugely inappropriate payments and possible corruption, that makes the case for reopening the vote overwhelming.”
Jim Boyce, Fifa’s vice-president, told the BBC’s Sportsweek that any evidence of corruption surrounding the 2022 vote should be referred to Fifa’s ethics investigator, former US attorney Michael Garcia. Mr Boyce said he would have “no problem” if Mr Garcia recommended a revote because of wrongdoing.
The Sunday Times said payments of €305,000 in legal expenses and private detective fees were also made to former Fifa executive committee member Reynald Temarii. He was banned from the vote because of a newspaper sting showing him asking undercover reporters posing as officials for the US 2022 bid for money for his vote.
The Sunday Times alleges the payments were to support Mr Temarii’s appeal against his ban, a move that blocked his deputy – who was favouring the rival Australian bid – from taking his vote.
The newspaper said it was in possession of an electronic database of “hundreds of millions of emails, accounts and other documents” and that the leak had come from a Fifa whistleblower concerned about the Qatar 2022 vote.
Corruption allegations have mired the Qatar World Cup in controversy and are being investigated by Mr Garcia.
The new claims are not the first problems to beset Qatar’s hosting of the tournament. Human rights groups have also accused the emirate of failing to protect the rights of thousands of workers who are building the infrastructure for the competition.
Last month, Doha responded by promising to abolish labour regulations that create conditions tantamount to slavery, but human rights groups called the measures vague and said they did not go far enough.
Mr Blatter himself said last month that awarding the 2022 World Cup to Qatar may have been “a mistake”, although he was referring to the problem of playing the tournament in extreme summer temperatures.
Fifa is meeting in São Paulo next week ahead of the start of the World Cup in Brazil on June 12, when it will discuss this and other issues relating to the 2022 tournament.
Mr bin Hammam was banned from football for life following claims he bribed Caribbean football officials during his election campaign for the Fifa presidency. He declined to respond to questions from the Sunday Times.
The Daily Telegraph claimed in March a company run by Mr bin Hammam paid nearly $2m to former Fifa vice-president Jack Warner shortly after the December 2010 vote.

Spiegel: Britain's Cameron warns of possible EU exit if Juncker wins presidency

Spiegel: Britain's Cameron warns of possible EU exit if Juncker wins presidency

A German press report says British PM David Cameron has warned that his country could leave the EU if Jean-Claude Juncker wins the bloc's top job. Juncker remains optimistic about his chances.

The report by German news magazine Der Spiegel cited EU sources who quoted Cameron (seen left above) as saying that if Juncker became president of the European Comission, it would destabilize his government to such an extent that a planned referendum on EU membership would have to be brought forward.
The sources had understood Cameron as meaning that the odds of a vote in favor of Britain leaving the EU would then increase if Juncker was chosen, the magazine said.
Cameron has promised to hold a referendum on whether or not to remain in the EU by the end of 2017 if his government is re-elected in a 2015 general election.
On Monday he rejected calls for bringing the referendum forward after his Conservative party was beaten in European elections by the euroskeptic United Kingdom Independence Party (UKIP) and the main opposition Labour Party.
'1980s face'
Cameron is reported to have made his comments on a possible EU exit on the sidelines of an EU summit in Brussels on Tuesday in front of several European politicians, including German Chancellor Angela Merkel. Merkel on Friday reconfirmed her support for Juncker after long reticence on the subject.
Both Merkel and Juncker's parties are members of the center-right European People's Party (EPP), which gained the most seats in last week's European Parliament poll.
Cameron's Conservatives left the EPP in 2009. The British premier opposes Juncker as commission president, regarding him as too federalist. He has called instead for a reformist candidate.
"A face of the 1980s will not be able to solve the problems of the next five years," Spiegel quoted Cameron as saying.
Juncker remains hopeful
But in an interview with Germany's Bild am Sonntag newspaper, ex-Luxembourg premier Juncker said he was backed by a majority of leaders, and urged heads of government not to yield to the pressure of a minority in their decision.
"Europe must not allow itself to be blackmailed," Juncker said, adding that he was "optimistic about being chosen as the next Commission president by mid-July."
The Bild am Sonntag paper reported that French President Francois Hollande is among those who oppose Juncker receiving the position.
Without naming sources, the paper said Hollande wanted a French person to take the job, and, in talks with Merkel, had suggested his former finance minister, Pierre Moscovici, for the job.

(BFW) German Regulator Seeks More PE, Funds Oversight: Handelsblatt

German Regulator Seeks More PE, Funds Oversight: Handelsblatt
2014-06-01 14:11:24.166 GMT


By Alex Webb
     June 1 (Bloomberg) -- The “shadow” banking sector,
including hedge funds, private equity and special funds, needs
more global regulation, Elke Koenig, the head of Germany’s Bafin
regulator, says in interview with Handelsblatt. Koenig also
says:
  * Progress is already being made to limit the connections
    between such sectors and banks
  * Indebtedness of such institutions must be taken into account
  * NOTE, May 20: German Regulator Welcomes Sale of Contingent
    Notes by Banks
  * NOTE, Apr 9: BaFin’s Koenig Says Global Derivatives Rules
    Must Be Consistent


For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>

To contact the reporter on this story:
Alex Webb in Munich at +49-89-24447-8802 or
awebb25@bloomberg.net
To contact the editor responsible for this story:
Simon Thiel at +44-20-7673-2814 or
sthiel1@bloomberg.net

Germany Re-Evaluating EU7b Airbus Helicopter Order: Spiegel

+------------------------------------------------------------------------------+

Germany Re-Evaluating EU7b Airbus Helicopter Order: Spiegel 2014-06-01 09:54:23.72 GMT

By Alex Webb June 1 (Bloomberg) -- Germany is reviewing the memorandum of understanding for the EU7b order, Spiegel says, without saying where it got the information. * Deal also includes 18 naval variants for further EU915m euros * Operating costs for these could be twice as high as current Sea King helicopters, government report found * Germany has told Airbus to find viable solutions * No resolution expected before 2016 * NOTE: Feb. 20: German Defense Minister Fires Deputy in Arms Procurement Drive * NOTE: Jun. 26: Merkel Coalition Back Cut in Tiger, NH90 Helicopter Orders

For Related News and Information: First Word scrolling panel: FIRST<GO> First Word newswire: NH BFW<GO>

To contact the reporter on this story: Alex Webb in Munich at +49-89-24447-8802 or awebb25@bloomberg.net To contact the editor responsible for this story: Simon Thiel at +44-20-7673-2814 or sthiel1@bloomberg.net