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Corporate February
16, 2004 |
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| Honda and General Electric form strategic alliance in the business jet engine market |
TOKYO - February
16, 2004 – Honda Motor Co., Ltd. and General Electric Co. (GE) today
announced the formation of a strategic alliance to produce a new jet engine
for light business jets.
The basic agreement was signed today at Honda Motor headquarters in Tokyo,
Japan, by Takeo Fukui, President and CEO of Honda Motor, and David Calhoun,
President and CEO of GE Transportation, a business unit of GE, which is
headquartered in Fairfield, Connecticut, USA.
Today’s agreement establishes the framework under which Honda and
GE will further develop and certify Honda’s new HF118 turbofan jet
engine. Honda started its jet engine and aircraft projects in 1986, and
has been developing the lightweight HF118 engine, in the 1,000 to 3,500-pound
thrust class, since 1999.
The HF118 has run more than 1,400 hours, including ground tests and more
than 200 hours in flight tests on an existing flying test aircraft. In addition,
two HF118 engines have powered Honda’s new experimental compact business
jet, the HondaJet, in flight tests that began in December 2003.
The Honda/GE basic agreement includes: joint certification of the HF118;
joint marketing activities under both companies’ joint brand with
airframe manufacturers; and continued discussions on the business structure
under which the two companies will mass produce the engine. Honda and GE
have been in discussions for more than a year, and expect to sign a formal
definitive agreement later this year.
“We have great respect for the technology, design and performance
built into Honda’s HF118 engine,” said GE’s Calhoun.
“There are tremendous benefits to Honda and GE entering the business
jet engine market together. Honda is the world’s leading producer
of engines for motorcycles, automobiles and power products with superb
technology. We are delighted to form a strategic alliance.”
“This is a great step forward for Honda to enter the aviation business,
which has been a dream of the company since its creation,” said
Honda’s Fukui. “We aim to commercialize our compact jet engine
business by merging mutual strengths: Honda’s HF118 turbofan engine
technology, and GE’s technology, sales, and support through a spirit
of equal partnership. We are confident in forming an alliance with GE,
which is the leading manufacturer in the jet engine industry.”
The emergence of smaller, relatively inexpensive business jets, which seat
from four to eight passengers, creates the potential for considerable engine
sales for future business and personal travel. Honda and GE envision an
annual market in the future for approximately 200 or more of these business
jets. Small business jet applications include owner operators and fractional
owners, as well as potential “air taxi” operations. The “air
taxi” business involves micro jets flying passengers on short stops
using the vast number of small airports not serviced by major airliners.
Jet engine technology is also driving market change. In the 1990s, GE took
its jet engine designs for large airliners to regional jet passenger aircraft,
a market previously dominated by propeller-driven, turboprop aircraft. Now,
Honda and GE will bring their expertise to a new generation of smaller,
lightweight, low cost, and highly efficient turbofan jet engines with the
lowest operating costs.
Honda (NYSE: HMC) is one of today’s leading manufacturers of automobiles
and power products and the largest manufacture of motorcycles in the world.
Honda has always sought to provide genuine satisfaction to people worldwide.
The result is more than 120 manufacturing facilities in 30 countries worldwide,
producing a wide range of products, including motorcycles, ATVs, generators,
marine engines, lawn and garden equipment and automobiles that bring the
company into contact with over 17 million customers annually.
GE (NYSE: GE) is a diversified technology and services company dedicated
to creating products that make life better, from aircraft engines and power
generation to financial services, medical imaging, television programming
and plastics. GE operates in more than 100 countries and employs more than
315,000 people worldwide.
The company traces its beginnings to Thomas A. Edison, who established
Edison Electric Light Company in 1878. In 1892, a merger of Edison General
Electric Company and Thomson-Houston Electric Company created General
Electric Company. GE is the only company listed in the Dow Jones Industrial
Index today that was also included in the original index in 1896.
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