Aviation
Aircraft demand spurs record gain in U.S. durable goods orders
WASHINGTON DC-Orders for long-lasting U.S. manufactured goods posted their biggest gain on record in July on strong overseas demand for aircraft, and the underlying trend also remained firm, pointing to brisk economic growth.
Durable goods orders, items ranging from toasters to aircraft that are meant to last three years or more, jumped 22.6 percent last month after an upwardly revised 2.7 percent increase in June, the Commerce Department said on Tuesday.
Transportation orders rose a record 74.2 percent as bookings for civilian aircraft more than tripled. Boeing (BA.N) had said earlier it received a record 324 aircraft orders in July. At the same time, orders for autos logged the biggest gain in five years.
Outside of transportation, demand was decidedly softer. Still, upward revisions to the data for June as well as a pick-up in business investment plans, shipments and order backlogs suggested a strong underpinning for growth.
“This report reinforces the message that manufacturing growth is picking up and is likely to support stronger GDP growth in the second half of the year,” said John Ryding, chief economist at RDQ Economics in New York.U.S. stocks traded higher, with the Dow Jones industrial average .DJI reaching an all-time intraday high, with Boeing shares up 0.4 percent. Prices for U.S. Treasury debt rose, while the dollar was flat against a basket of currencies. Helping bolster investors’ spirits, the Conference Board said consumer confidence hit its highest level in nearly seven years in August. A gauge of households’ perceptions of the labor market touched its best level since July 2008.
A separate report, however, showed house price growth continued to slow in June. The S&P/Case Shiller’s national house price index rose 6.2 percent from a year ago, the smallest gain since November 2012 and down from a 7 percent rise in May.
The housing sector cooled abruptly last year as mortgage rates moved higher, with a lack of supply also crimping sales. Economists think slower price appreciation will help keep the housing recovery on the rails.
STRONG AUTO ORDERS
Many of the Boeing orders, including 150 planes by the Dubai-based airline Emirates EMIRA.UL, were for a new version of its top-selling twin-aisle 777 jet, which is still under development and sells for about $377 million at list price.
The aircraft is due for delivery in 2020. It will take at least 10 years for the resulting increase in production from the orders, which also included the Dreamliner jet, to filter through to U.S. gross domestic product.
The report on durable goods orders showed demand for non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, slipped 0.5 percent in July.
But the decline followed an upwardly revised 5.4 percent advance in June and bolstered perceptions that business spending is rising. These core capital goods orders were previously reported to have increased 3.3 percent in June.
Shipments of these goods, which are used to calculate equipment spending in the government’s GDP measurement, increased 1.5 percent last month, helping to prompt Morgan Stanley to raise its third-quarter growth estimate by five-tenths of a percentage point to a 3.5 percent annual rate. Barclays lifted its estimate by 0.3 percentage points to 2.7 percent.
Unfilled orders for core capital goods increased 1.1 percent last month after rising 1.7 percent in June, showing a steady pipeline of work that will keep the nation’s factories humming.
“There is plenty of gas in the tank for continued growth in business spending,” said Tim Quinlan, an economist at Wells Fargo Securities in Charlotte, North Carolina.
An Abuja-Accra flight experienced technical difficulties mid-air on Friday, forcing it to return to Abuja, shortly after departure.
The Nigerian Safety Investigation Board (NSIB) made the disclosure in a statement, adding that it has launched investigation into what it described as a serious accident.
Director, Public Affairs and Family Assistance, NSIB, Bimbo Olawumi Oladeji stated that preliminary investigations revealed the aircraft experienced an engine number two indication issue.
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It was gathered that the aircraft, with registration number 5NKAL which was operating a flight from the Nnamdi Azikiwe Airport, Abuja (DNAA), to Kotoka International Airport, Accra (DGAA).
She explained that four persons were onboard when the incident occurred. The crew immediately requested for a diversion back to Abuja due to the engine indication.
Oladeji added that the crew managed to safely land the aircraft at Abuja Airport at 18:16 UTC.
There were no injuries reported, and all individuals on board are safe.
Nigeria has acquired 12 pre-owned Alpha Jets from the French Air Force as part of efforts to enhance the operational capacity of the Nigerian Air Force (NAF).
The deal, facilitated through SOFEMA, a French military and aeronautics company, was announced by Olusegun Dada, Special Assistant to President Bola Tinubu on via X on Thursday.
He said, “All the 12 aircraft are ready for shipping.”
The Alpha Jet, a product of Franco-German collaboration, is a versatile military aircraft designed for light attack and advanced training missions.
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Equipped to carry bombs, rockets, and missiles, the aircraft also features a gun pod for close air support.
The NAF already operates 11 Alpha Jets, but this latest procurement signals a significant boost to its fleet.
Dada also confirmed that the Air Force is expecting 24 M-346FA light attack aircraft, ordered during the administration of former President Muhammadu Buhari.
The first batch of these Italian-made aircraft is expected to arrive early next year.
Air Chief Marshal Hasan Abubakar, the Chief of Air Staff, described the acquisitions as a testament to President Tinubu’s commitment to bolstering the armed forces.
“This renewal of our aircraft fleet reflects the government’s commitment to ensuring the safety and security of Nigerians,” Abubakar said.
The announcement comes on the heels of President Tinubu’s three-day state visit to France, where he met with French President Emmanuel Macron.
The visit, which took place from November 27 to November 30, highlighted deepening ties between the two nations.
To ensure the sustainability of its expanding fleet, the Air Force has proposed establishing a local maintenance hub.
Speaking in October, Abubakar noted that six units of the M-346FA aircraft were already in production, with the initial batch of three expected to be delivered in early 2025. The full fleet is projected to arrive by 2026.
“These developments underscore the importance of creating a domestic support system for the long-term upkeep of our aircraft,” Abubakar added.
As the holiday season draws near, Aero Contractors has introduced a minimum ticket price of N80,000 for all local flights.
The move, which will last until January 2024, aims to ease the financial burden on Nigerians amid the high cost of living.
Ado Sanusi, Managing Director of Aero Contractors, made the announcement on Tuesday during a press briefing, describing the fare reduction as a gesture to help Nigerians celebrate Christmas and the New Year without the stress of steep ticket prices.
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Sanusi said, “We understand the economic hardship Nigerians are facing, especially with high ticket prices, and we know the holiday season is nearby.
“In the spirit of Christmas, Aero Contractors has introduced what we call pocket-friendly Christmas prices. These fares, starting at N80,000, will apply to all our destinations, allowing Nigerians to travel without excessive costs.”
As of Tuesday afternoon, an economy class ticket from Lagos to Abuja was priced at N99,643, while business class tickets were being sold for N189,167.
Sanusi further explained that the initiative was designed to make it easier for families to reunite during the holidays.
“This is a way for us, as an organization with a long history of serving Nigerians, to give back to our loyal customers. We want to make it possible for families to meet their loved ones during this festive season without worrying about exorbitant travel costs,” he added.
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