Honeywell (NASDAQ: HON) and Bombardier, a global leader in aviation and business jet manufacturing, have announced a groundbreaking partnership to bring advanced technologies to the forefront of aviation. This agreement will provide cutting-edge solutions in avionics, propulsion, and satellite communications for both current and future Bombardier aircraft, significantly enhancing the flying experience for operators and passengers alike.
The strategic collaboration is valued at $17 billion over its lifetime, and is set to drive innovation and operational efficiency within the aviation industry. This agreement reflects Honeywell’s commitment to supporting the growing megatrends of automation, sustainable aviation, and the energy transition, while helping Bombardier maintain its position as a leader in the business jet market.
Under the agreement, Honeywell will deliver next-generation avionics systems designed to offer exceptional adaptability to meet specific mission requirements, enhancing both situational awareness and safety. Additionally, the companies will collaborate on the development of Honeywell’s advanced HTF7K engine, which will provide enhanced power, reliability, and maintainability for Bombardier aircraft.
“We are thrilled to co-innovate with Bombardier to push the boundaries of aviation technology,” said Vimal Kapur, Chairman and CEO of Honeywell. “This partnership aligns perfectly with our focus on advancing automation, the future of aviation, and sustainable energy solutions, while enabling the delivery of next-generation technologies like Anthem avionics and engines.”
Eric Martel, President and CEO of Bombardier, echoed this sentiment, stating, “Honeywell’s unmatched technology is the driving force behind this collaboration. Together, we are not only enhancing the capabilities of our aircraft but are setting the stage for the future of aviation.”
The partnership will also focus on the integration of Honeywell’s JetWave X, a satellite communications system, for both new aircraft models and retrofit installations in the Bombardier Global and Challenger families. This system will offer reliable connectivity and next-generation safety services, further elevating the performance and experience of Bombardier aircraft operators.
In addition to the technological advancements, the companies have successfully resolved any pending legal matters, paving the way for an unimpeded, long-term partnership that will undoubtedly shape the future of aviation.
While the collaboration will bring substantial long-term benefits, it has led Honeywell to adjust its 2024 financial outlook. The investments required to support the agreement will impact the company’s near-term performance. As a result, Honeywell has updated its full-year sales and earnings guidance.
Honeywell now expects sales for the year to range between $38.2 billion and $38.4 billion, with organic growth at approximately 2%. The updated guidance also includes an adjusted earnings per share (EPS) range of $9.68 to $9.78, reflecting the upfront investment needed to drive future growth. These adjustments, while affecting short-term performance, are expected to create significant value for Honeywell shareholders in the long run.
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