By Andy Nativi
Stung by criticism in Washington over the VH-71 presidential helicopter program that U.S. Defense Secretary Robert Gates wants to scrap and reassess, AgustaWestland is firing back and arguing, essentially, that there is no reason to start all over.
Rather than junking the Increment 1 helos, which the Pentagon says only have 5-10 years of useful life and are therefore not worth fielding, AgustaWestland argues that the rotorcraft, with some certification activities, can be validated for at least 10,000 hours of useful life, not the 1,500 specified by the Navy. The baseline AW101 aircraft is already certified for that flight time.
Moreover, with about $3.3 billion already sunk into the program, AgustaWestland argues it can deliver 19 more Increment 1 variants for another $3.5 billion.
The total would roughly equal the original VH-71 program budget before costs more than doubled as requirements grew and the program raced ahead.
The helo maker further is floating the idea of building an upgraded version, a so-called Increment 1.5, which would be close to meeting the full program requirements but below the $13 billion price tag the program has now reached.
Meanwhile, AgustaWestland has delivered the fifth pilot-production VH-71 from its Yeovil, U.K., production facility.
Chief Executive Officer Giuseppe Orsi says that while program costs have doubled, the helicopter’s portion is only a comparatively modest 8 percent over plan and six months behind schedule, which he attributes to 50 major and 800 other design changes.
AgustaWestland on April 28 finished delivery of Increment 1, with the last of nine VH-71s now bound for completion with integrator Lockheed Martin (Aerospace DAILY, April 29).
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A near collapse in business jet deliveries, softening demand for both commercial and defense aircraft and costs associated with a staff reduction program have resulted in a first-quarter net loss of $23.4 million for Embraer.
The Brazilian manufacturer recorded a 13.5% year-on-year dip in first quarter revenue to $1.15 billion as deliveries dropped by five units to 40 airframes in the quarter. Gross profits at the same time fell almost 23% to $209.6 million, while operating income declined from $48.7 million in the first quarter of 2008 to $27.2 million in the same period this year.
Last year, Embraer recorded a first quarter net profit of $85 million.
For this year’s first quarter the airframer also recorded an undisclosed number of cancellations from its executive jet backlog and deferral of several – again undisclosed – commercial orders. As a consequence, the value of Embraer’s backlog fell 5.7% in the three months to $19.7 billion, although its E-Jet backlog is still a healthy 354 aircraft.
“In light of this new scenario, Embraer revised its revenue guidance for 2009 to $5.5 billion,” the company said in its first quarter statement. Of this, $3.3 billion is still expected in commercial sales, while just $800 million will come from the airframer’s executive aviation division, and most of this will be in very light jet sales.
A further $600 million is forecast in defense and government sales, while services and “other” should generate another $800 million.
The downturn in business jet demand is illustrated in the first quarter results. In just one year, executive jet sales have dropped from $173.6 million to $70.2 million, as deliveries of corporate jets fell from seven to just two. As a percentage of total sales, executive aviation now accounts for 6.1% of revenue, less than half the 13% recorded in the first quarter of 2008.
This slump puts more emphasis on Embraer’s commercial aircraft, which accounted for 75.3% of all first quarter sales despite a 6.4% dip in value to $870.4 million. At the same time last year, the $929.5 million generated in commercial revenue represented 69.6% of all sales.
Defense and government revenue in the first quarter also declined 23.6% year-on-year to $657.8 million, although as a percentage this segment only fell from 6.6% to 5.9%.
Embraer’s services division, however, recorded growth in the period, with revenue growing 2.1% to $128.1 million. Its influence on total sales also grew to 11.1% from the 9.4% recorded in the first three months of 2008.
But the decline in demand was only one factor in Embraer’s first quarter loss. A plan to cut 20% of its workforce cost $33.3 million in the first quarter, and even though the company retained some deposits from the cancellations, one-time charges totaled $32.4 million.
At the same time, Embraer also paid $45.4 million in income tax during the first quarter, a reversal on the $21.3 million tax benefit recorded in the same period in 2008.
Photo credit: Embraer
By Jennifer Michels
IATA will be integrating more information about public health concerns into its online travel center that currently is geared more toward public information than airline operations.
Over the coming days, IATATravelCentre.com users may notice more links to public health organizations or local authorities concerning the swine flu. Although IATA considers the World Health Organization (WHO) to be the top authority in times of an outbreak such as this one, it can be confusing when advisories or recommendations or mandatory requirements come from various groups around the world, so it hopes to centralize those postings on its Web site.
IATA already has a 54-page global influenza preparedness plan document for airlines on the site. Spokesman Steve Lott said that one thing IATA discovered in 2003 during the SARS outbreak was that while airlines had terrorism and crisis communications plans in place, they did not all have plans in place for public health scares.
In the latest operational news from Latin America, Canadian tour operators have started bailing out of Mexico as concerns mount. Air Transat, Canada’s largest travel company, is canceling trips and will not resume flying into Mexico until at least June 1. According to Stuart Morris of Itravel2000.com, “Air Transat has made the tough decision to basically pull the planes out of Mexico. They have taken their planes, and they are moving them to Cuba, the Dominican Republic, and they are taking their people as well.”
Sunwing Vacations has canceled all departures to Mexico until the end of May, and Sunquest has canceled its tours until the beginning of June. Air Canada has also announced that it will suspend flights to Cancun, Cozumel and Puerto Vallarta until June 1. Flights to Mexico City, however, will still take off. WestJet is also grounding flights to resorts in Mexico with seasonal service to Cancun returning in the Fall.
Also, the Argentine government suspended flights to and from Mexico until Monday morning. Separately, officials at Ezeiza Airport have installed sensor machines to measure the body temperatures of passengers arriving from the U.S., Canada and those who are still currently in flight from Mexico.
Mexicana de Aviacion and TACA both reported massive cancellation or postponement of flights from Costa Rica to Mexico. Both airlines confirm that people are canceling or postponing flights, up to 40 or more daily and that could increase up to 300 daily in the coming days.
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Boeing is providing new details about what the 787 and its sister ships will do as part of its upcoming flight test and certification plan, noting that nearly 60% of the documentation required for certification has been submitted to the FAA.
Once it begins the flight test effort, ZA001 will be used to explore the fundamental aerodynamics and handling qualities envelope. This includes flutter, stability and control, flight controls, major systems work, low-speed handling including stalls, and checks of the full data system.
The flight test fleet is made up of six aircraft, four (ZA001-004) of which are Rolls-Royce Trent 1000-powered and two (ZA005-006) of which are General Electric GEnx-1B powered.
The second aircraft (ZA002) will test stability and control, autopilot, avionics, propulsion and electric systems. The third 787 (ZA003) will cover tests of electro-magnetic/high-intensity radiated fields (EME/HIRF), systems, noise, flight deck, ETOPS, avionics and minimum data system. ZA004 will cover high speed aerodynamic performance, community noise, propulsion, ETOPS and flight loads survey.
ZA005 will also repeat some flutter work because it is the first GEnx-1B powered version, as well as performing stability and control, aerodynamic performance, propulsion, avionics, community noise and ETOPS. The second GE-powered aircraft, ZA006, will undertake lightning-specific EME tests, and HIRF, more ETOPS and miscellaneous tests with minimal analog requirements.
The Rolls-powered fleet is expected to amass some 2,430 flight test hours and 3,100 ground test hours, while the smaller GE fleet is expected to build up 670 flight test hours and 600 ground test hours.
Mike Delaney, vice president and chief project engineer on 787, says nearly 60% of the documentation required for certification has been submitted and, of the remaining 40%, less than 10% will be generated as part of flight tests. “There are about 4,000 deliverables we will deliver to the FAA. Of the remaining parts, around 300 are flight test dependent,” he adds.
The 787 is currently subject to 152 issue papers with the FAA covering minor details of the certification requirements. “Boeing and the FAA are in negotiation on those,” says Delaney. The aircraft is also subject to 16 special conditions – many of which cover the new technology areas such as the composite primary structure that have not previously been certificated.
Boeing adds it is in discussions with the FAA on two exemptions – one of which relates to emergency descent time in the event of an engine failure and rapid cabin decompression. Delaney adds, “There is potential for a third” exemption related to the stretch out of the development cycle. As the 787 development now exceeds a five-year period from when the certification process was begun, talks are underway to evaluate if the aircraft should be subject to rules subsequently adopted regarding emergency egress lighting.
Photo credit: Boeing
By David A. Fulghum
France would like the U.S. to make up its mind on a tanker aircraft so they can plan modernization of their own aerial refueling fleet with 14-15 new aircraft, a senior French official in Washington says.
In addition, the French Air Force has made modernizing its airborne and seaborne intelligence fleets a new strategic priority, notes French Air Force Major Gen. Gratien Maire, defense attaché to Washington. Some of the effects of advanced intelligence data fusion using ships, aircraft and UAVs already have been seen in the military’s recent handling of abductions by Somali pirates.
French defense officials plan to beef up France’s staff assigned to NATO to 900 persons from the current 100. They also are considering moving more troops out of Kabul and into combat in eastern Afghanistan.
Give and take
While the French government does not think it is being asked to give the U.S. more than it gets in return, the veteran pilot does point out that the defense trade balance between Europe and the U.S. is 4-to-1 in America’s favor. In particular the French Air Force “needs new [aerial refueling] equipment,” he says. And while France plans a competition for at least 14 tankers, if the U.S. Air Force were to choose the Northrop Grumman/EADS tanker candidate it would be an easier sell for the French politically, cut acquisition costs and ensure that the fighter and tanker fleets of both countries are completely interoperable.
While “we [also] still want competition,” because of the difference in acquisition processes “cooperation is necessary” between U.S. and French governments and military forces to ensure compatible tanker programs, he says. France also is looking at the British model of letting industry help finance a tanker fleet. However, he points out that right now there is no specific schedule for the program.
Interoperability also extends to intelligence gathering and fusion. The last white paper on French strategic defense plans added a new strategic function to improve “knowledge and anticipation” of future problems through broad improvements in “all-spectrum intelligence,” Maire says.
Another big agenda item for France is the manpower and financial commitment to NATO operations in Afghanistan. Planners intend to increase France’s commitment to the NATO staff to 900 officers, NCOs and civilians from the current 100, Maire says. They will add about 400 million euros annually to the defense budget even as the French military is being reduced in size. The up-tick in NATO participation is to better balance France’s relationship between NATO and the European Union and “to be part of the planning process in dealing with crises,” he says.
Meanwhile, there is a desire by Paris to move French troops out of Kabul — after passing control to the Afghans — and to focus more on combat operations in eastern Afghanistan. Troops will stay “as long as needed,” Maire says.
He did caution that the French government has to work on maintaining public support for the troops in Afghanistan and show “political will” in supporting operations there. They don’t want to risk the perception that the U.S. is taking over in Afghanistan, and that can best be done by ensuring the French that the international community is committed to stopping the violence there. “The fact is that the U.S. has the resources and will have more people,” Maire says. “The population has to understand that everybody is there to help.”
Photo: Northrop Grumman
By Lee Ann Tegtmeier
DALLAS–TAP Maintenance & Engineering is close to finishing branding VEM Maintenance & Engineering to TAP. The Brazilian maintenance unit’s name was legally changed in February, and since then, the facility’s signage has been switched, ground vehicles should don TAP’s logo by today, and employee uniforms should all feature the TAP logo by May 10, according to Jorge Sobral, a member of the executive board for TAP Maintenance & Engineering.
Beyond these visual signs, Sobral said the Portuguese and Brazilian MRO units “now only have one commercial direction,” and the facilities are very coordinated.
Maintenance on Boeing aircraft will remain in Brazil, and Airbus MRO will go where capacity is available and where the customer wants it to be, he said. However, “some component maintenance will only be available in Lisbon, and others will only still be available in Brazil,” he added.
TAP became the sole shareholder in VEM in April 2007. It took controlling interest of the MRO from Varig in August 2006.