Tuesday, October 9, 2012

BAE – EADS Merger: Economically Freshly Still-Born?

Slated to supposedly result in the biggest non-American aerospace firm, is the BAE – EADS merger be freshly still born due to insurmountable regulatory hurdles and declining defense markets?

By: Ringo Bones

Even though concerned parties may have until Wednesday, October 10, 2012 to decide to give the green light of the proposed merger of BAE – EADS, regulatory hurdles permitting. And at the proverbial “11th Hour” of the proposed merger, there is still no agreement between the governments of France, Germany and the UK despite Number 10 Downing Street stating that state ownership of the resulting aerospace firm should be limited. Given the seemingly insurmountable regulatory hurdles, politics and the “declining defense markets”, will the BAE – EADS merger, if it goes through, result in an economically viable merger?

INVESCO – the main underwriter of the merger was never shy in recently stating that there’s no strategic logic in the proposed merger. And to “seasoned observers” in the post Cold War development of the global aerospace / defense industry – a.k.a. the proverbial “Military-Industrial-Complex”, the oft quoted buzzword of the “declining defense markets” seems to be a euphemism for Al Qaeda and the Afghan Taliban not having a preexisting aerospace industry in which the remaining superpower has to destroy as the world’s aerospace and defense industries’ makes a really handsome profit. So if the merger goes through, how will it ever make a profit?

In our post-9/11 world where America and her NATO allies are currently busily involved in the “War on Terror”, the only pieces of military hardware oft used in this on-going conflict are large propeller driven military troop carriers and long-haul subsonic high capacity long jumbo-jet like cargo planes. Not to mention the odd unmanned aerial drone or two. The truth is, the post-9/11 War on Terror is not just as profitable to established global aerospace and defense firms as the saber-rattling between the US and USSR during the height of the Cold War.  

Wednesday, September 19, 2012

JAL Relisting: The Airline Industry Still Profitable?

With the recent relisting of Japan Air Lines in the Tokyo Stock Exchange since filing for bankruptcy two years ago a sign that the airline industry is still profitable?

By: Ringo Bones

With an IPO valued at 8.5 billion US dollars – second only to the recent Facebook IPO as the biggest share sale for 2012 - and currently the most actively traded stock in the Tokyo Stock Market as of September 19, 2012, JAL, Japan Air Lines is now relisted and back in the black. It seems like one of Asia’s biggest airlines was destined for a “disappearing act”, but will this recent rally be the signal that the global airline industry is still profitable?

Around the start of the global economic downturn back in 2008, the two biggest “threats” endangering the long-term profitability of the airline industry are sky-high fuel prices and the decline in international tourism – which is primarily caused by the global economic downturn in the first place. Japan Air Lines was delisted back in February 2010 and had been running on Japanese government bailout money since. Thankfully, JAL’s profitability is now on a level that not only enables the airline company to pay back the government bailout funds but also to be able to have it relisted on the Tokyo Stock Market and issue IPOs.

Potential investors are warned, though, because tenured financial analysts still have caveats over the rather short return to profitability of JAL given the size of the airline company and the scope of its financial losses back in 2010. And given that the Japanese government had recently given the green light for a quantitative easing to stimulate flagging business in the country, JAL’s position of being the most actively traded stock in the Tokyo Stock Exchange today could, hopefully, last for sometime. 

Wednesday, May 30, 2012

The Saab J35 Draken: The Most Beautiful Jet in the World?

It was designed back in the mid 1950s as a state-of-the-art supersonic capable interceptor for the Swedish Air Force as a defense against marauding Soviet-era bombers, does the Saab Draken still deserve the title as the most beautiful jet fighter in the world?

 By: Ringo Bones

 As it was slowly phased out during the latter half of the 1990s, quite a large number of Seattle Grunge Rock fans have noticed that somewhat obvious Swedish Saab J35 Draken flyby 4 minutes and 4 seconds into the music video of Burden In My Hand by Soundgarden back in 1996. Many of the "Young Turks" marveled the beauty of the Draken's double-delta design and was somewhat crestfallen when they found out a few weeks later that the jet was made in Sweden as opposed to being made in the good old US of A. So there are still people who marveled at its beauty near its retirement back then - but 15 or so years on, can the Swedish Saab J35 Draken still deserve being called the most beautiful jet aircraft in the world?

 Well, given that the F-22 Raptor has been described as a "bad elementary school origami" by some under-15 aerospace enthusiasts, and it seems like Osama Bin Laden's Al Qaeda never established their own aerospace industry to rival the big-wigs Boeing and Lockheed-Martin into some form of post Cold War aerospace beauty pageant using new generation of fighter planes. Then, it seems like the Swedish Saab J35 Draken may be in the foreseeable future may still be called and deserving of the title as the most beautiful jet fighter in the world - bar none.

 Looking back, it seems like the Saab Draken's most striking feature of it's "beauty" was its double-delta wing design that not just enable it to fly at very high speeds and altitutes to intercept incoming squadrons of bombers, but also to enable the jet to carry more fuel and weapons that conventionally-winged designs. Oh by the way, most Swedish jet fighters designed after World War II are capable in taking off and landing on ordinary asphalted motorways - which is a plus if your lucky enough to afford a mothballed second hand Saab J35 Draken these days. Which some say only the XB-70 Valkyrie rivals it in sheer beauty, right?

Monday, January 23, 2012

Why Do In-Flight Meals Taste Different?

Despite the lavish menu offered on those rare occasions that you manage to afford to fly first class; have you ever wondered why in flight meals / airline food taste different in comparison to their ground-level counterparts?

By: Ringo Bones

Imagine that this is one of those rare occasions that you’ve managed to afford yourself to fly first class and you’ve been served a course that previously you can only get when a wealthy relative or co-worker has a lavish wedding reception. Have you ever noticed how that well-reviewed up-market white wine that you’ve just been served tasted a little more sour compared to the last time you tasted one in a rich co-workers wedding reception? Or come to think of it, why the sudden craving for tomato juice?

Recent studies conducted on in-flight meals / airline food served by major airline companies have shown that lowered cabin pressure and lowered prevailing relative humidity in the passenger plane’s cabin as soon as it has reached cruising altitude of around 35,000 feet affects how most foods and beverages taste compared to the ones served at ground-level. The average cabin pressure of a plane in a typical airliner reaching cruising altitude of 35,000 feet is similar to the prevailing air pressure found on top of a mile-high / 5,000 feet high mountain. But to what extent does the lowered cabin pressure and relative humidity affect the taste of airline foods and beverages on offer?

To wine connoisseurs, heavy earthy wines tend to retain their ground-level taste even after the plane reaches a cruising altitude of 35,000 feet while lighter white wines tend to taste more sour. And to those watching their salt/ dietary sodium and sugar intake, be careful, because a reduced air pressure and humidity can reduce our tongues’ ability to perceive saltiness and sweetness by as much as 30%, so airline foods tend to contain 30% more sugar and salt than average. And for some strange reason, tomato juice tend to taste better in the reduced air pressure and relative humidity of an airliner reaching their cruising altitude of 35,000 feet, so be prepared for tomato juice cravings if you have ever tried drinking one in-flight.