Auguring an exciting week for the upcoming Paris Air Show, Airbus’s new A350 widebody aircraft made its maiden flight on Friday, June 14, more than two weeks ahead of schedule. With the A350, Airbus is trying to avoid the costly delays and production issues that have plagued its competitor, the Boeing 787.
Over the past week, the DoD announced two major aircraft procurement awards. The U.S. Navy awarded a multiyear aircraft contract for V-22 Ospreys to Bell Helicopter and Boeing worth $6.5 billion over five years. The V-22 contract covers fiscal years 2013 through 2017 and will be used to purchase 99 aircraft, with an option of 22 more Ospreys. Marine Corps Colonel Gregory Masiello believes that given the current fiscal situation, this award signals strong long-term confidence in the aircraft. Additionally, Boeing signed a $4 billion contract with the U.S. Army for CH-47F Chinook Helicopters. Under the contract, the U.S. Army will purchase 177 aircraft with an option of 38 additional helicopters. This order will bring the Army’s total procurement of CH-47Fs close to its target of 464 aircraft. The two multiyear aircraft contracts are expected to result in $1.8 billion in savings compared to individual aircraft purchases.
On Monday, Booz Allen Hamilton’s shares fell approximately 4.5% after the company confirmed Edward Snowden as an employee. Snowden claims to be the source of the National Security Agency leak on data surveillance of phone and internet usage. Shares continued declining as much as 8% as the story developed, but recovered slightly to end the week down 5.1%.
Intevac Inc. (Up 4.5%) – Shares rose for the week after the company received a $27 million contract from the U.S. Army for M611 night vision cameras that will be integrated into the Apache Helicopter’s Pilot Night Vision Sensor.
Kratos Defense and Security Solutions (Up 6.4%) – Shares were up for the week after the company announced $3 million in new contract awards. Though details remain classified, the company stated that the products will support a modular data center and communications related to an undisclosed customer.
Paramount Group acquired Advanced Technology and Engineering Company (Pty) Ltd., a provider of aeronautical engineering services including civilian and military systems integration, unmanned aircraft system development, and mission sensor innovation, in a bankruptcy sale. The acquisition expands Paramount Group’s suite of aerospace, land, and maritime defense products and augments the company’s civilian market expertise. Terms of the deal were not disclosed.