Wednesday, December 06, 2006

A350 Funding: All Heat and No Light?

We've been puzzling since Monday over the dang indefiniteness of the funding that's allegedly going to launch the latest! No! Newer! Better than any aircraft in the sky! A350XWB from The Maginot Line.

Reuters has said that the Line is 'drawing the veil' over how they expect to fund this project, probably because they don't really have a clue how they're going to put the package together-it's more of the "Shove it downhill-it should pick up speed." model of project planning.

So...let's apply a little Yanqui plain thinking to this subject.

If the Gulf State money men from Dubai and Qatar were interested or thought it was a great deal they would have been there at the Great Unveiling. They were not. At least not under the present conditions-perhaps they think that ruinous exactions are the way to go and are holding their hand for now. They also may be thinking they've got enough tied up in airplanes that may never get built and they're not interested in throwing more good money after bad. That's a possibility.

The Maginot Line has said they're going to be able to squeeze out several billion euros in savings from the Force 8 or Plan 8 program or whatever they call it....the only way this happens is through massive layoffs in Europe. Even so, savings of that magnitude may not be attainable and we might see some divestiture of non core assets. They'll be burning the furniture to heat the house. That's another possibility.

The governments of France and Germany will open their checkbooks and say "OK, you morons. How much does the bail bondsman want THIS time?" That's a real likelihood.

Fact is, they probably haven't a clue as to how they're going to finance the project, or else they would be trumpeting it to everyone who'll listen.

The only way this project makes sense is if they kill the A380. They haven't gotten that far in their thinking but give it time.

In other news, Thai Airways is making nasty cancellation noises if they don't get what they want and soon. That's fuel for the fire.

And we haven't even mentioned what the WTO case does to the picture. The Maginot Line's answer to this has been a consistent "You too, Boeing! So's your mother!"

Think about that for a minute. They're not denying they've been on the government teat, because they can't. That's a pretty piss poor sack of arguments to take to court or to an arbitration panel. Take it from this lawyer-it's not a winning argument.

Stay tuned....this could get ugly.


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