Honeywell Wins $16 Billion Airbus Contract

Industrial conglomerate providing major mechanical systems for Airbus's new long-range, wide-body A350.

WASHINGTON (AP) — Industrial conglomerate Honeywell International Inc. said Wednesday it will provide the major mechanical systems for Airbus's new long-range, wide-body A350 aircraft, under a contract expected to generate more than $16 billion (euro11.45 billion) in revenue over 20 to 25 years.
Honeywell said the contract is the largest systems and equipment package Airbus has awarded to date on this program.
As part of the deal, Honeywell will design and build an auxiliary power unit and other equipment that supply pneumatic and electric power for the aircraft while on the ground or in-flight.
The company will also build systems to manage all of the air used on the aircraft for environmental control, including cabin heating, cooling and pressurization.
The A350XWB family is Airbus plan for a series of efficient, medium-capacity, long-range wide-body aircraft. With a range of up to 15,400 kilometers (9,569 miles), it is available in three basic passenger versions: the A350-800 accommodating 270 passengers, the A350-900 seating 314, and the A350-1000 for 350 passengers.
Total firm orders and commitments for the A350XWB stand at 254 aircraft, including 154 firm orders and 100 commitments. The Airbus aircraft is scheduled to hit the market about five years after rival Boeing Co.'s new mid-size, longhaul 787 jetliner. To date, Boeing has received 706 orders for the 787. The plane is sold out through late 2013.
Earlier this month, Boeing executives said flight testing on the 787 would be delayed until mid-November or mid-December, three months later than originally expected. The company insists they will remain on track to deliver the first plane on time to Japan's All Nippon Airways in May, pending any problems that arise out of testing.
Honeywell has had a long-standing commercial relationship with Airbus, making everything from avionics systems to flight management computers to brakes, and with recent changes to the aircraft it is expecting future opportunities.
''Historically, Airbus would have had a lot of this done in-house,'' said Rob Gillette, president and chief executive of Honeywell's aerospace division. But under this contract, Honeywell will be responsible for managing the suppliers for a major system within the aircraft, he added.
Honeywell's facilities in Phoenix and Torrance, California, will handle the majority of system integration on the aircraft, as well as additional work from its European partner.
For the first half of 2007, Honeywell earned $611 million (euro437.2 million), or 78 cents per share, on revenue of $8.5 billion (euro6.08 billion).
Shares of Honeywell added $1.09 to $58.37 in morning trading.
AP Business Writer Jennifer Malloy in New York contributed to this report.
More in Supply Chain