Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

4-Traders Homepage  >  Equities  >  Nyse  >  Boeing Company (The)    BA

SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsSector newsTweets 

Economic Slowdown Puts Brazil's Plans to Buy New Fighter Jets on Hold

share with twitter share with LinkedIn share with facebook
share via e-mail
0
08/09/2012 | 10:41pm CEST

--Brazil has no timeline to purchase a new generation of fighter jets

--Brazil's defense minister not in conversations with companies at the moment

--Brazil has no favorite company in the fighter-jets bidding process

 
   By Luciana Magalhaes 
 

SAO PAULO--Brazil Defense Minister Celso Amorim said the economic slowdown has delayed a long-awaited decision to purchase a new generation of fighter jets.

"The project is not being abandoned. There will be a decision in the right time. But, today, I would prefer not to give a date," Mr. Amorim said in an interview with Dow Jones. "The economic situation has taken a less favorable turn than expected and it naturally requires caution."

The process--which has lasted more than a decade--involves three international contenders: the Gripen NG made by Sweden's Saab AB (SAAB-B.SK, SAABF), the F/A-18 Super Hornet of U.S. company Boeing Co. (>> The Boeing Company), and the Rafale warplanes manufactured by France's Dassault Aviation SA (>> DASSAULT AVIATION).

Brazil's government sent a letter to the three companies in June asking them to extend the proposals for the jets until December. According to the government, this is an usual practice, expected to happen every six months, if a decision isn't reached.

"I am not in conversations with any companies at the moment, which doesn't exclude the possibility that I might receive somebody here," the minister said in his office in Brasilia.

In 2010, Luiz Inacio Lula da Silva and Nicolas Sarkozy, then presidents of Brazil and France, respectively, issued a joint statement saying Brazil entered into exclusive negotiations involving the Rafales, but not long after the Brazilian government backtracked and said the competition was still wide open. In the end, Mr. da Silva left the decision to his successor, Dilma Rousseff.

"Today, I wouldn't say any company is favorite. The important question is when we will do it and, then, we will again look into the proposals," the minister said. "There's a need to re-equip but it needs to be resolved accordingly with the country's possibilities."

Price, quality and technology transfer are the three key elements, "but the specific weight that will be given to each one of these is something that I haven't had the chance to discuss profoundly. There is no decision," Mr. Amorim said.

Mr. Amorim said a decision earlier this year by the U.S. government to cancel an order of Brazilian-made military training planes wouldn't weigh against Boeing. In late February, the U.S. Air Force canceled an order for Super Tucanos of Embraer SA (ERJ, EMBR3.BR) and restarted the contest, saying top procurement officials weren't satisfied with the documentation in the bidding.

Donna Hrinak, Boeing's president in Brazil, said the company is "prepared to wait for the decision of the Brazilian government." Representatives for Grippen and Dassault couldn't be reached for comment Thursday.

Other defense programs in Brazil, meanwhile, are moving ahead, including on the construction of a nuclear-powered submarine in a joint project with France. Brazil has also bought 50 new helicopters made locally. Mr. Amorim is keen to see Brazil invest more in defense.

The ministry's budget is around 1.5% of gross domestic product, or about BRL61.76 billion ($30.6 billion) in 2011. Ten years ago, spending was far lower, at BRL25.5 billion, but accounted for about 2% of GDP. Mr. Amorim said he wants to return to those levels, which would bring the country closer in line with spending in countries such as China, Russia and India.

"This is my goal. It's not an approved government program. It's something I consider reasonable to be attained," Mr. Amorim said.

Brazil hasn't fought a war in years. It fought the Paraguay war in 1865 and was somehow involved in the first and second World Wars, but Mr. Amorim said the country needs a defense system capable of protecting its vast natural resources, which include recent discoveries of huge oil reserves off the country's southeast coast. Moreover, water has become a significant asset, he said.

"Today, besides the energy, the oil, or the capacity of producing food, we have a resource that is likely the most sought-after in this 21st century, which is the fresh water," Mr. Amorim said.

The minister said defense spending can also be a powerful way to create and keep jobs during the ongoing economic slowdown, and can provide incentives for technological advances.

Write to Luciana Magalhaes at [email protected]

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

Stocks mentioned in the article : The Boeing Company, DASSAULT AVIATION
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on BOEING COMPANY (THE)
06/24 BOEING : Iran's Qeshm Air to Purchase 10 Boeing Passenger Planes
06/24 BOEING : Iran’s Qeshm Air to buy 10 Boeing passenger planes
06/24 Omni-Lite Industries Discusses Work in the Titanium Field and Recent News in ..
06/24 BOEING : Kawasaki Heavy Industries collaborate to win in the marketplace
06/23 Business briefs
06/23 BOEING : Federal Contracts Awarded to Companies in Arizona (June 23)
06/23 BOEING : Federal Contracts Awarded to Companies in Missouri (June 23)
06/23 BOEING : Federal Contracts Awarded to Companies in Washington (June 23)
06/23 BOEING : Airbus to sell 73 planes to Iranian airlines
06/23 BOEING : to Release Second-Quarter Results on July 26
More news
Sector news : Commercial Aircraft Manufacturing
06/24 RAYTHEON : CEO of Raytheon's Forcepoint eyes IPO - Boersen-Zeitung
06/23DJBOEING : Is Top Seller at Paris Air Show -- WSJ
06/23 ELBIT : says innovation key to crowded drone market
06/22 AIRBUS' : Leahy reveals negotiating tricks after 'last air show'
06/22DJBOEING : Outsells Rivals at Paris Air Show -- Update
More sector news : Commercial Aircraft Manufacturing
News from SeekingAlpha
06/23 LOCKHEED MARTIN : An American Icon
06/23 What Should Retirees Do During A Bear Market?
06/23 WALL STREET BREAKFAST : Brace For The Russell Reconstitution
06/23 DAY 4 AT PARIS AIR SHOW : Boeing Signs With Major Airline, Airbus Parties With I..
06/22 What I Missed At The Paris Air Show
Advertisement
Financials ($)
Sales 2017 91 961 M
EBIT 2017 9 129 M
Net income 2017 6 387 M
Debt 2017 1 498 M
Yield 2017 2,78%
P/E ratio 2017 19,27
P/E ratio 2018 17,88
EV / Sales 2017 1,34x
EV / Sales 2018 1,32x
Capitalization 122 062 M
More Financials
Chart BOEING COMPANY (THE)
Duration : Period :
Boeing Company (The) Technical Analysis Chart | BA | US0970231058 | 4-Traders
Full-screen chart
Technical analysis trends BOEING COMPANY (THE)
Short TermMid-TermLong Term
TrendsBullishBullishBullish
Technical analysis
Income Statement Evolution
More Financials
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 27
Average target price 193 $
Spread / Average Target -4,7%
Consensus details
EPS Revisions
More Estimates Revisions
Managers
NameTitle
Dennis A. Muilenburg Chairman, President & Chief Executive Officer
Jenette Ramos Senior Vice President-Supply Chain & Operations
Gregory D. Smith Chief Financial Officer & Executive Vice President
Ted Colbert Chief Information Officer
Gregory L. Hyslop CTO, Senior VP-Engineering, Test & Technology
More about the company
Sector and Competitors
1st jan.Capitalization (M$)
BOEING COMPANY (THE)29.90%122 062
UNITED TECHNOLOGIES CO..11.49%97 926
LOCKHEED MARTIN CORPOR..12.28%81 336
AIRBUS SE20.46%65 563
GENERAL DYNAMICS16.60%60 735
RAYTHEON14.34%47 259
More Results