Russian SU-35 at the 2013 Paris Air Show

PARIS AIR SHOW: It’s fair to say that the unabashed star of this show was the Russian Sukhoi Su-35 fighter. It didn’t fly much but when it did, jaws dropped. With no American military fighters, helicopters or cargo planes flying here this year, the Su-35 pretty much had the show to itself, since the European… Keep reading →

[Corrected at 4:50 pm to fix misquotation; see note below] With today’s spectacular but not unanticipated collapse of the mega-merger between Airbus parent company EADS and British armsmaker BAE, what’s next? The conventional wisdom is that BAE, the smaller of the two firms, is now vulnerable. But top analysts tell Breaking Defense that, in many ways, the reaction against the deal by both the German government and the stock market is a bigger rebuff for EADS.

Here’s the conventional wisdom in a capsule: “There will almost certainly be greater pressure on BAE Systems than EADS to reveal a plan B strategy as soon as possible,” wrote IHS Jane’s analyst Guy Anderson in a widely distributed email. “[T]he company has put itself firmly out on the field in terms of merger discussions….Investors are unlikely to be satisfied with business as usual.” Keep reading →

The value of the European defense giant Finmeccanica has plunged by about one-third in the last week as senior company officials face corruption allegations. The Financial Times reports that “a widening corruption investigation” helped push the value of the company “down to new 13-year lows on Monday.”

The company told investors last week that it would probably lose €200 million this year. On top of that gloomy news, one senior company official — the director of external relations — “stepped down” after news reports claimed he was being investigated in connection with a corruption case involving Italy’s civilian air traffic controller. The company said he denied any wrongdoing and had stepped down until the investigation is complete. The company’s chairman, Pier Francesco Guarguaglini, is also under investigation.

A board meeting is likely in the next week, the FT reported. The Italian government owns roughly one-third of Finmeccanica, which comes in at number 8 of the Defense News Top 100 defense companies. The company sells the C-27 Joint Cargo Aircraft to the Defense Department with program prime, L-3 Communications. The U.S. Air Force oversees the program. Keep reading →