Aerospace Industrial Development Corp (AIDC, 漢翔航空工業), the nation’s largest civilian and military aircraft manufacturer, yesterday said the company expects to see stable earnings growth next year as it balances revenue streams from the military and civilian sectors.
The company reported that net income in the third quarter dipped 23.07 percent annually to NT$1.16 billion (US$38.7 million) in the light of challenges faced by its customers, with sales falling 5.23 percent to NT$19.4 billion. Earnings per share in the first nine months were NT$1.23.
The company’s engine casing sales were affected as aircraft and engine designers continued to phase out the CFM56 engine for the LEAP engine, AIDC president Lin Nan-chu (林南助) said at an earnings conference in Kaohsiung.
Other challenges include the announcement by Mitsubishi Heavy Industries Ltd in January that delivery of its Mitsubishi Regional Jet would be delayed by two years to complete required design changes, Lin added.
Whether aircraft or engines, long development cycles and delays are quite common in the aerospace industry, Lin said, adding that the company has been striving to replace lost civilian sector sales with military contracts.
While designers have improved fuel efficiency by 25 percent in designing the LEAP engine, they are seeking further refinements before beginning to mass produce the engine, he said.
There is also a shortage of the advanced alloys used in the engine casing, and this lack of materials has delayed production, he added.
The company took a similar hit recently when rock-bottom oil prices stifled demand for helicopters, as oil producers stopped surveying activity in the field.
The revenue breakdown for the first 10 months showed that 46 percent of sales were civilian aircraft and 53 percent were military jets, compared with civilian sales of 51 percent and military sales of 48 percent last year, Lin said.
The main focus of the company is military contracts, in particular a contract with the nation’s air force to build a new fleet of trainer jets, Lin said.
The trainer jet contract is backed by a NT$68.6 budget from the Ministry of National Defense, with 66 aircraft due to be delivered by 2026.
Most of the machinery used at the company’s new engine casing plant is made by Taiwanese companies, AIDC chairman Anson Liao (廖榮鑫) said.
Having 90 percent of it made in Taiwan represents an early milestone of a vision to form an “A Team” alliance of tier-1 local suppliers to compete together in international markets, he said.
Still, some alliance members have dropped out.
“Some just lack the will to commit to the cost of elevating their standards for the international market and are unable to deliver the required quality at the stipulated time frame and price,” Liao said.
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort