Jens Flottau/MUNICH
US business aircraft manufacturers are among the targets of Fairchild Aerospace as it urgently seeks partners to help it secure additional funding to cover the $1 billion development costs of its new 728JET regional jet family.
The company has indicated it is in talks with US business aircraft manufacturers that are looking to expand their portfolio of aircraft. Fairchild offers corporate versions of the existing 328JET and planned 728JET, dubbed Envoy 3 and Envoy 7, and hopes to raise $150 million by the end of the year.
Fairchild's discussions with ATR about a link were terminated earlier this year and the company was also rumoured to have held co-operation talks with rival Bombardier. Fairchild says neither company is now on its agenda for a partnership. DaimlerChrysler Aerospace (Dasa) still holds 20% of Dornier, but says it will not put any more money into the Fairchild subsidiary. Approaches are also being made to the financial community.
A consortium of four banks, three German and one Swiss, provided an $80 million loan early in July, which the US/German manufacturer says prevented it from having to slow down development of the 728JET. The company started its search for funding during the Paris air show in June and is confident it will conclude deals with US investors by October.
About $380 million of the $1 billion development cost is being shouldered by risk-sharing partners. A further $350 million is supposed to come from German Government-guaranteed loans, which should gain Bavarian and German parliamentary approval later this year.
That leaves Fairchild needing to find the remaining $270 million development costs, along with up to $500 million ramp-up costs, between now and 2005.
Source: Flight International