AgustaWestland managing director Richard Case has needed to balance the good times with some difficult decisions in the past 12 months. The UK-Italian alliance has scored several important business wins but has also faced up to closing one of its UK plants and losing almost 1,000 members of its workforce. Paul Derby finds out where the merged company goes from here.
Q: We're now about a year on from the launch of the combined AgustaWestland business. How satisfied are you with the benefits you have been able to derive to date?
A: Very satisfied. Don't forget we've been working together on the EH101 programme since 1982 so we knew each other's strengths.
We are now second in terms of turnover in the helicopter market and I believe we are potentially number one in the breadth of our portfolio.
We've taken duplication out of the way we work and the production cycles of the two businesses fit together very well. We've given ourselves more clout in the marketplace and we're more efficient. It's as simple as that.
Q: How do you reconcile the significant successes you've had over the last 12 months in Denmark, Portugal and Oman with the need to close one of your UK operations and lose numbers at another? Isn't that at odds with your performance?
A: Let's be clear that these job losses relate solely to what was the original Westland business in the UK. Our teams at Yeovil and Weston-super-Mare were very clearly aware of the shortfall in business that we would face between 2002 and 2004.
This is a cyclical business and although we have won new orders we do not begin manufacture immediately. We have been through an unprecedented period of growth.
Our turnover has risen 500% in the past nine years, but we are well advanced in our production of 66 Mk1 and Mk3 Merlins for the Royal Navy and Royal Air Force and similarly with the Apache AH1 for the Army. Export work alone can't replace that volume of business.
Q: You've set your stall out with the Super Lynx programme to extend the lifespan of this family of helicopters by 30 years. Can you clarify the status of the two programmes being launched by the UK Ministry of Defence which will be the lifeblood of the aircraft?
A: Don't forget that we have secured some enormously important wins for Super Lynx in Malaysia and particularly in Oman.
Concluding the Omani deal was a huge shot in the arm for us, but you're right, the aspirations of the British Army and the Royal Navy to rebuild their helicopters to a common standard has big potential for us too.
The MoD has funded a risk assessment phase for the Army Air Corps which is looking for about 60 remanufactured helicopters. The RN equivalent is likely to win funding for a similar number of aircraft next year.
Q: Talking about the Apache programme, how do you assess your progress? You have had to cope with some negative press over the last two years.
A: We're very happy but more importantly the customer is very happy. We've delivered 18 aircraft and our production ramps up to two a month this year.
The programme has been criticised in one or two quarters but the National Audit Office conducts an annual poll into defence procurement. Apache was rated in the top two in terms of MoD programmes. We stand by that.
Q: Do you believe there is more consolidation to come in the industry?
A. I think everyone in the industry is learning that there are times when working together provides the best solution to the customer.
Having said that I would still be extremely surprised if in five years' time there are still three major players in the US market.
Our focus now is to make AgustaWestland as strong a force as it can be. We would need to consider our strategic direction if further mergers became a possibility.
Source: Flight Daily News
