Hawk aircraft assembly line could play bigger role in Saudi Arabia

BAE Systems reported rising sales and profits in the first half of 2017 as it hopes for further orders for its Typhoon fighter jet to Gulf countries. (Reuters)
Updated 03 August 2017
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Hawk aircraft assembly line could play bigger role in Saudi Arabia

LONDON: A Hawk aircraft assembly line established by British defense giant BAE Systems could be used to bring more aircraft manufacturing to Saudi Arabia.
It comes as defense contractors seeking orders in the Kingdom come under increased pressure to contribute to Vision 2030, the economic diversification strategy being driven by Crown Prince Mohammed bin Salman, deputy premier and interior minister.
The world’s third-largest defense company is supplying its latest batch of 22 Hawk training jets to the Kingdom, under a deal agreed two years ago following an earlier order for 18 of the aircraft.
The final assembly of the planes, which are used to train fighter pilots, will be done in Saudi Arabia, with the first deliveries expected in the third quarter of the year.
“As part of the Hawk batch-two contract, we agreed to establish a final assembly line for Hawk in Saudi Arabia,” said BAE Systems’ international managing director, Guy Griffiths.
“I think it would be self-evident that having established that facility and built 22 Hawk aircraft through it, it would be a great shame if it wasn’t then used for final assembly of other aircraft.”
Saudi Arabia is investing heavily in developing its domestic defense industry as the ongoing war in Yemen drives military spending.
At the same time, the Kingdom aims to create skilled jobs in areas such as aeronautical manufacturing.
“This is all driven by Vision 2030,” said Griffiths. “In every negotiation that’s conducted, whether with us or other defense suppliers, a key component beyond the price and specifications of the product is what is the industrial, training, development and technology transfer contribution that goes with this order? It’s probably the most preeminent part of every negotiation.”
BAE Systems this year delivered the final four aircraft of the 72 planes under its Salam Typhoon program in Saudi Arabia.
It also has a Typhoon support program, and agreed an additional 20,000 flying hours under a contract amendment signed in April.
The company said it had also delivered the first two of 12 Typhoons on order to Oman. The remaining deliveries to Oman are scheduled for the second half of 2017 and 2018.
BAE Systems reported an 11 percent rise in first-half earnings of £945 million ($1.25 billion) on Wednesday, beating analyst estimates.
The earnings were the first to be presented by new Chief Executive Charles Woodburn, who took over from Ian King in July.
The former oil industry executive, who worked for Schlumberger for 15 years, served as chief operating officer at BAE Systems for more than a year before taking up his new role.
He said his leadership will be marked by “evolution, not revolution,” adding: “It’s clear we have the right strategy that harnesses our strengths, so we’ll continue to stay the course.”


Tesla shares fall after CEO Musk abuses British diver

Updated 17 July 2018
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Tesla shares fall after CEO Musk abuses British diver

  • The billionaire entrepreneur’s spat with British diver Vernon Unsworth started last week, after rescue teams rejected Musk’s offer of a mini-submarine created by his rocket company SpaceX
  • Musk gave no evidence for alleging Unsworth was a pedophile

NEW YORK: Shares of Tesla Inc. fell 2.75 percent on Monday after Chief Executive Elon Musk directed abuse on Twitter at one of the British cave divers involved in the rescue of 12 Thai children last week.
A number of analysts and investors, requesting anonymity, told Reuters that Musk’s comments are adding to their concerns that his public statements are distracting him from Tesla’s main business of producing electric cars. The stock sell-off knocked almost $2 billion off the company’s market value.
Tesla shares closed at $310.10 before rising 1.9 percent in after-hours trading.
James Anderson, a partner at Tesla’s fourth-largest shareholder, asset manager Baillie Gifford, called the weekend’s events “a regrettable instance” and said he had reiterated to the company the need for “peace and execution” of its core business.
The billionaire entrepreneur’s spat with British diver Vernon Unsworth started last week, after rescue teams rejected Musk’s offer of a mini-submarine created by his rocket company SpaceX to help rescue a 12-member soccer team and their coach trapped inside a flooded cave in the northern province of Chiang Rai.
“He can stick his submarine where it hurts,” CNN reported Unsworth as saying. “It just has absolutely no chance of working.”
Musk shot back on Sunday on Twitter: “We will make one (video) of the mini-sub/pod going all the way to Cave 5 no problemo. Sorry pedo guy, you really did ask for it.” The tweet was later deleted.
Tesla spokespeople and lawyers did not respond to emails and phone calls from Reuters requesting comment on Musk’s comments on Twitter.
Musk gave no evidence for alleging Unsworth was a pedophile. Unsworth said he would consider taking legal action against Musk over the remarks, in comments filmed in Chiang Rai on Monday by Australia’s 9News. Reuters could not reach Unsworth for comment.
Unsworth’s wife told Reuters on Monday that her husband was returning to Britain on July 19, where he will speak to lawyers.
Last week, Narongsak Osottanakorn, the leader of the rescue operation in Thailand, rejected Musk’s mini-submarine as not suitable for the task. Musk responded on Twitter on July 10, calling Osottanakorn “not the subject matter expert.”
Musk also regularly uses Twitter to criticize media reports on Tesla, which has struggled to meet its own production targets for its Model 3 sedan, which is seen as key to the company’s profitability.