Columnists

At the aerospace suppliers' conference in Lynnwood this past week, speculation was rife that Airbus could announce as early as this summer that it intends to build commercial jets in the United States.

The heavy favorite for an A320 final assembly line is Mobile, Ala., which would make that city the latest node in an emerging aerospace-manufacturing cluster in the southeastern U.S. Two people at the Pacific Northwest Aerospace Alliance (PNAA) gathering who have contact with Airbus and its suppliers, speaking on condition of anonymity, said they believe Mobile will get the go-ahead to build up to 10 single-aisle jets a month.

To avoid any potential political interference from French unions, they suggested, an announcement will come after the French presidential election in May.

Others were willing to discuss publicly the implications of such a dramatic Airbus move.

"It would be a very good and logical move for Airbus," said Michel Merluzeau, the French-born chief executive of Kirkland's aerospace consultancy G2 Solutions.

Airbus, like Boeing, is seeking to rapidly boost its single-aisle jet capacity, he said. It also would like to shift more of its costs out of the eurozone into dollars.

But the greatest impact of the move, he said, might be to end the political perception of Airbus in the U.S. as a foreign jet maker.

Last year, an Airbus plan to assemble commercial jet freighters alongside military refueling tankers in Mobile was shelved when Boeing snatched away the Air Force tanker contract.

If Airbus were to establish U.S. manufacturing by building A320neos in Mobile to compete against Boeing 737 MAXs built in Renton, it would be much better positioned the next time it bids for a big Defense Department contract — which could be with its new A400M military transport plane.

"When you have a footprint in the U.S., it completely changes the perception of people on Capitol Hill," Merluzeau said.

Norbert Steinkemper, who promotes aerospace-business development for the German state of Lower Saxony, said the strategic benefit to Airbus would go beyond the A320, to its eventual replacement with an all-new single-aisle jet in the 2020s. "If you have to develop a new program and still maintain an existing program, it makes sense to have a global production system," said Steinkemper, who also attended the Lynnwood conference. A move into Mobile would "position Airbus to have a facility ready for a new small airplane in the next decade."

Last month, the chief financial officer of Airbus parent EADS, Hans Peter Ring, publicly raised the possibility that Airbus will soon resurrect the idea of building jets in the U.S., telling Bloomberg News that Airbus needs to look at the option of an A320 final assembly line in this country to buoy sales of those jets.

Asked about the speculation at the PNAA conference, Airbus spokesman Clay McConnell said, "There hasn't been a decision made firmly."

But echoing Ring's remarks, he said, "I'm very hopeful this is something we will do at some point ... It'll be great for Airbus and great for the U.S. industrial base."

Dominic Gates: 206-464-2963 or dgates@seattletimes.com

Seattle's McAdams

trims its winning

stock research

Investment weekly Barron's reports that during the tumultuous five-year period ending in December, the stock picks of Seattle brokerage McAdams Wright Ragen outpaced the recommendations of eight other firms it tracked — including heavyweights like Goldman Sachs and Morgan Stanley.

The regional brokerage's Focus List earned a 21 percent return over that period, says Barron's, adding that the firm "should take a deep bow. Indeed, this broker has consistently punched above its weight." Along with the No. 1 five-year record, McAdams Wright's Focus List ranked fifth, third and second over six months, one year and three years, respectively.

However, McAdams Wright's high rankings come as the firm dials down its research efforts.

In the fall it stopped sharing analyst reports with institutional investors through outlets such as First Call. In December it ended coverage of about 10 stocks, including Blue Nile, Columbia Banking and Zumiez. And its stable of analysts shrank with the departure of research director Paul Latta, who'd run the Focus List for about seven years.

McAdams Wright Ragen founder Scott McAdams says the firm is adjusting to the realities of the marketplace. Institutional investors, which buy and sell securities in large volume for large, professionally managed portfolios, were a big part of the firm's business, but last year only generated $1 million of its $38 million in revenues, he says.

With about 170 employees and six offices in Washington and Oregon, McAdams Wright occupies a special local niche — much smaller than super-regional brokerages like D.A. Davidson, but larger than the various boutique investment firms.

It now manages about $7.5 billion for small retail clients.

"We're still profitable and we're still growing. For us, the retail side is the one that's blooming," McAdams said.

"A lot of it is retirees — and they're less concerned about getting a share of Facebook than about preservation of capital."

So he's not about to abandon the firm's traditional "contrarian, value-style investing," McAdams says. "There are lots of ways to make money on Wall Street, and what's important is to master one style and stick with it."

Research is expensive, McAdams says, and it's increasingly hard to get compensated for generating ideas for big institutional traders, and to cover the small-capitalization stocks that fewer investors own. "We're still trying to stay abreast of the mid- and larger-cap stocks in the Northwest," he says.

As for the Barron's shout-out: "We feel good about it, we're just trying to be humble and be cognizant of the fact that it's hard to beat the market."

— Rami Grunbaum

Comments? Send them

to Rami Grunbaum:

rgrunbaum@seattletimes.com

or 206-464-8541.