Services Boost Bottom Line at Eurocopter, Despite Sagging Helicopter Sales
Late in January Eurocopter unveiled record revenues–more than €5 billion, with service activity offsetting helicopter deliveries that sagged slightly. The Marignane, France-based company claims to have a 43-percent market share. For 2020, CEO Lutz Bertling is aiming at €9 billion revenues ($11.7 billion), at least 40 percent of it derived from services.
Record revenue of €5.4 billion ($7 billion) last year, up by 12 percent over 2010, includes revenue following last year’s acquisition of Canada-based maintenance specialist Vector Aerospace. Without the acquisition, Eurocopter’s revenue growth would have been about 7 percent.
Deliveries totaled 503 helicopters, down from 527 in 2010. Last year, the manufacturer received net orders for 457 helicopters worth €4.7 billion ($6.1 billion), compared with 346 the previous year. Services accounted for 38 percent of revenues in 2011 but 43 percent of orders by value.
Production Ramp Up
Citing the low number of cancellations–15–Eurocopter received last year, CEO Lutz Bertling sees a recovery in the civil helicopter market. In addition, he said, the downturn mostly affected the light segment, and the company saw significant sales in that sector last year.
For this year, Bertling predicts 500-plus orders: “We are on the way back to pre-downturn delivery levels.” Eurocopter’s best year for deliveries was 2008, at 588 helicopters.
As a result of recent orders, a major focus this year will be to ramp up production. Bertling specifically mentioned the Ecureuil series (AStar, TwinStar, EC130), the Super Puma series and the EC145T2. The company will increase the output of some of these models by 60 to 70 percent, he said. The challenge is clearly in the supply chain. “Other OEMs like AgustaWestland and Airbus are stressing the same supply chain,” Bertling noted.
Eurocopter still has plans to add a final assembly line in China. “It is not a question of if but when,” Bertling said. He noted, however, that China has not yet delivered on all of its promises for aviation, such as opening all of its lower airspace to civil operations.
Eurocopter signed a global sales agreement with Chinese firm Avic (the parent company of Avicopter) in March authorizing Avic to sell license-produced Eurocopter models. Bertling would not disclose the names of the countries.
The helicopter manufacturer has also set its sights on Brazil, where it intends to become the national helicopter OEM in a collaborative venture already under way with Helibras and starting with the military EC725 and Fennec. Bertling intends to take advantage of the country’s strong growth. “Brazil has an influence over all of Latin America,” he noted.
Bertling emphasizes his company has to keep the pressure on costs. The two-year Shape cost-saving program has met its target of achieving €200 million ($260 million) in savings each year, Joseph Saporito, Eurocopter’s executive v-p for the global supply chain, told AIN. According to Saporito, Eurocopter has integrated the Shape philosophy into its culture.
The X3 compound helicopter demonstrator was to resume flights in mid-February, with the goal of addressing questions raised by data analysis from the first two flight-test campaigns, said chief technology officer Jean-Michel Billig.
During the third flight-test phase, Eurocopter will explore the behavior of the main rotor at high speed as well as the Fadec and the relationship between rotor rpm and aircraft speed. Bertling made it clear Eurocopter also wants to break the unofficial speed record Sikorsky set in 2010 (250 knots with the X2).
While Bertling concedes “there is no business case to transform existing products using X3 technology,” there could be one for a compound version of a new conventional helicopter, provided designers maintain a 70-percent level of parts commonality between the two.
The conventional helicopter could be used for 50-nm offshore missions, while the compound variant could be used to fly 200 nm offshore, for example. For both the manufacturer and the operator, there would be a case for developing these variants, Bertling believes. One reason for focusing on the offshore oil-and-gas market is the current high price of oil. “[Because oil is more than] $100 a barrel, oil companies keep investing in remote fields,” Bertling emphasized.
The first application of X3 technology–probably on a helicopter the size of a Super Puma–may thus be in service by 2020 or 2021.
Bertling is optimistic about the future of the rotorcraft industry, particularly for commuter applications. “Due to airport slot scarcity, there will be room, from the mid-2020s, for vertical-lift commuter solutions,” he predicts. AgustaWestland shares this view but believes in the tiltrotor formula, as opposed to the compound helicopter.
Meanwhile, development of the X4, an AS365 Dauphin/EC155 medium twin replacement, is progressing toward a first flight slated for 2015. An “intermediate configuration” is scheduled to be certified in 2016. It will feature a new airframe, new engines and a new main gearbox. The final X4 configuration, planned for 2020, will revamp the man-machine interface with advanced displays and fly-by-wire (FBW) controls.
Billig highlighted the benefits of such controls. Wire controls afford much more flexibility in the layout because a wire is easier to install than rods, cables and pulleys. “You can run the electric harness almost anywhere,” Billig said. And you can easily build redundancy by duplicating wires.
Pilots can expect reduced workload, with their tasks relating more to flight management. The firm also wants to take advantage of FBW to improve safety. Future Eurocopters will feature flight envelope protection, just like Airbus airliners. In fact, this has already started with the EC225’s autopilot. One of the inputs the autopilot receives is the available power from the engines (or the engine, in case the second one is inoperative). From there, the system calculates the helicopter’s limitations.
Last year Eurocopter flew a “hybrid” AS350 Ecureuil/AStar, using an electric motor during autorotation to replace the lost power of the turbine after engine failure. The electric motor increases maneuverability, thus allowing the pilot to control the helicopter more easily during the descent. “First, there is an instantaneous power supply to avoid the drop in rotor rpm. Then, just before landing, power is supplied again for a smooth touchdown,” Billig explained.
The hybrid concept presents challenges in terms of weight, bulk and cost, but Billig is confident he can offer a solution for a production hybrid system soon and receive a formal go-ahead this year.