Graham Warwick/Washington DC
Industry observers must be wondering when, if ever, the commercial helicopter market will fulfil its potential. The helicopter is among the most versatile of flying machines, but its operating cost and environmental impact are among factors which have held back civil sales.
Manufacturers have moved to stimulate demand by developing products offering more performance for less cost, and the results will be on display at the Helicopter Association Inter-national (HAI) Heli-Expo '99 convention in Dallas, Texas, from 21-23 February.
While new aircraft from industry leaders Bell Helicopter Textron and Eurocopter have boosted sales, orders remain below past highs. One reason is the regulatory environment in which helicopters are developed and operated.
The past year has seen restrictions imposed on air tour operations over US national parks, in a bid to restore natural quiet. While this is stimulating interest in quieter helicopters, it has the near-term effect of depressing a key market for the industry.
After witnessing the impact on some sectors of the commercial market of the US Department of Defense's wholesale disposal of surplus ex-military helicopters, the HAI is taking the industry's pulse on the issue of competition from governmental operators offering commercial services. Examples include US Army National Guard units offering firefighting and emergency medical services (EMS) in competition with commercial operators.
A meeting is to be held at Heli-Expo to explore the need for a new HAI committee to focus on issues associated with so-called restricted category helicopters - ex-military machines in the hands of civil operators and government agencies offering commercial services. In some sectors of the market, notably law enforcement and logging, the availability of ex-military machines has significantly depressed the demand for new helicopters.
The HAI had hoped that the issue of commercial competition from government operators would be dealt with by legislation introduced by Congress last year, but the final bill signed into law was watered down and only requires federal agencies to list their activities in two categories: inherently governmental and commercially available.
The original version of the bill would have required agencies to transfer all commercial activities to commercial operators. Despite its disappointment, the HAI believes the watered-down bill still represents a victory "...because lawmakers will have a factual basis on which to guide future legislative proposals".
Environmental opposition to helicopters continues to be a major issue. One of New York's heliports was closed last year, and while a study has recommended maintaining the city's three other heliports, the industry is under no illusions that its infrastructure is free from threat. Hope lies in the flexibility of operations made possible by use of the global positioning system (GPS).
Regulatory challenges are not only being faced in the US domestic market. Internationally, manufacturers and operators face new regulations that threaten the market for civil helicopters. Efforts continue in a bid to harmonise US Federal Aviation Regulations (FARs) and European Joint Aviation Requirements (JARs) affecting helicopter certification, commercial operation and flightcrew licensing - all big issues for an industry that increasingly operates globally.
The most contentious issue has been the JAR-Ops 3 regulations governing commercial helicopter operations. HAI has protested that the proposed rules would impose unnecessary restrictions on single-engined helicopter operations. The European Joint Aviation Authorities has delayed implementing JAR-Ops 3 until 1 October, and may delay some sections further, as it processes comments, including HAI's, on the proposed rules.
Meanwhile HAI, as part of the International Federation of Helicopter Associations (IFHA), recently secured observer status at the International Civil Aviation Organisation (ICAO). The trade body hopes this will give the helicopter community a stronger voice in a forum dominated by the airline industry. "Helicopter interests will now have the opportunity for direct representation-in selected ICAO meetings," says IFHA chairman Lord Glenarthur. "This will-help ensure that [the helicopter's] unique versatility is recognised in the rule-making process."
The manufacturers' role in trying to restore the commercial helicopter industry to full health has been to stimulate demand. First Bell introduced the Model 407 light turbine single, an improved version of the Model 206 with only a marginally increased sticker price. The company has been rewarded with strong sales and delivered almost 100 examples last year, making the 407 its biggest seller. Bell hopes to repeat the feat with its Model 427 light turbine twin, which is priced aggressively against competing helicopters. Certification has been delayed, but deliveries should begin in May.
Eurocopter, meanwhile, has seen strong demand for both its EC120 light turbine single and EC135 light turbine twin. It has those markets essentially to itself, until the Bell 427 arrives to compete with the EC135. Bell has yet to unveil a response to the EC120, which competes against its long-established 206.
Two-Pronged Approach The European manufacturer is continuing the renewal of its helicopter range. Next to be available will be the EC155, an enlarged derivative of the AS365 Dauphin intended to compete with the Sikorsky S-76C+ in the key corporate, offshore and EMS markets. Bell has a two-pronged approach to this sector of the market: the BA609 civil tiltrotor and the AB139 medium twin-turbine helicopter, both planned to be produced under a joint venture with Agusta. Both will be available in 2002.
Eurocopter's next moves are expected to be the launch of the EC145, a revamp of the BK117 medium turbine twin, and possibly a Super Puma Mk3 - an upgraded version of the company's largest helicopter intended to compete against Sikorsky S-92 Helibus. Flight testing of the S-92 began at the end of last year.
Sikorsky sees a potential airline market for the S-92, encouraged by the relative success of its S-76 in scheduled operations. Three helicopter airlines use the S-76: long-running Helijet Airways in Vancouver, Canada; Helicopter Service linking Denmark's Copenhagen airport with Sweden; and East China Airlines, operating a shuttle between Hong Kong and Macau.
The US manufacturer is also exploring the potential market for a helicopter fractional ownership programme. This approach to reducing the cost of entry has been immensely successful for the business aircraft industry. One helicopter fractional ownership programme, HeliFlight Shares, is preparing to begin operations in Dallas, Texas, initially with two Bell 430 intermediate turbine twins. The company has eight more on options and holds delivery positions of a further five 430s, and is looking at setting up similar operations in Denver and the Los Angeles basin.
Sikorsky, meanwhile, has acquired an established helicopter charter operator with a view to starting up an S-76 fractional ownership scheme. No timetable has been revealed, but the manufacturer says it plans to test market the concept in New York and the US north east, where there is already a high concentration of corporate S-76 operators.
Executive helicopter sales have benefited from the strong US economy, but could suffer if the Asian downturn and fears of a domestic recession hit corporate confidence. Another market for the typically high-end machines favoured by corporate operators could prove to be the EMS sector, which continues to upgrade its equipment to provide better service.
Cost remains an issue for EMS operators, but pressure to provide a higher quality of service is driving the industry towards more expensive twins. Technology also helps operators provide a more reliable service, with the rapidly accelerating trend towards the use of GPS approaches to allow operations in reduced visibility. This trend tends to favour a shift towards more capable helicopters able to exploit GPS benefits.
The commercial helicopter market remains the domain of US and European manufacturers. Japan has certificated its first indigenously developed civil helicopter, the Mitsubishi MH2000, but is unlikely to be a serious competitor for some time.
Russia is trying to resurrect a commercial helicopter industry from the wreckage of its mainly military manufacturers. The near-term hope appears to lie with smaller machines, such as the single-piston Mi-34 marketed by Mi Light Helicopter, or the Ansat light turbine twin under development at Kazan Helicopter.
The US and European industry, meanwhile, continues to restructure. Blocked from selling the former McDonnell Douglas light helicopter line to Bell, Boeing has found a buyer for its commercial business in Dutch holding company MD Helicopters. What this means for the slow-selling MD-series is not yet clear.
In Europe, Agusta and GKN Westland announced plans last year to merge. They are already linked on the EH101 large helicopter programme, while Italy's Agusta is working with Eurocopter on the initially military NH90 and with Bell on the BA609 and AB139. The eventual shape of Europe's helicopter industry also remains far from clear.
Few of these industry issues will be resolved at this year's Heli-Expo, but as the world's largest assembly for the commercial helicopter sector, concerns with regulatory encroachment and industry consolidation are likely to be high on the list of talking points at Dallas.
Source: Flight International