Cahill on Taiwan mission: BAe may feel jet joint venture is now less important

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The Independent Online
JOHN CAHILL, chairman of British Aerospace, flew to Taiwan last night to revive talks on a pounds 250m regional jet joint venture with Taiwan Aerospace Corporation. A TAC board meeting on the troubled project has been postponed until after Mr Cahill meets the company today, writes Mary Fagan.

The venture, Avro, was originally conceived as a key element in BAe's plans to revive its regional jet business, which made a loss of about pounds 300m last year. In spite of Mr Cahill's rescue visit, it is believed that BAe feels there is now less urgency for the joint venture to proceed.

A BAe spokesman said yesterday: 'Before we do anything now, we will want to review the numbers in the interests of shareholders. We are a year further on and we have cut costs. We are also a year nearer a recovery in the aircraft market.'

There have been months of protracted talks between the partners, dogged by frequent reports that some Taiwanese bankers and officials are opposed to the deal. There have also been allegations of discord between the partners over the extent to which technology should be transferred to Taiwan.

BAe has now delivered nine of the new RJ variant of the regional jet family and has orders for 30 more RJ aircraft, which represents a year's production.

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