Reports of Piaggio Aerospace’s departure from the business aviation market are premature, it seems. The Middle Eastern-owned Italian manufacturer of the distinctive P180 Avanti has struggled to sell corporate aircraft in recent years as it simultaneously has tried to build a defence business based on special mission variants of the twin-pusher turboprop. However, a welcome order for the latest Evo version secured during early November’s National Business Aviation Association (NBAA) convention and exhibition showed there is still life in the Avanti.
The five-aircraft deal with four options from Californian charter and fractional operator West Coast Aviation Services could hardly be called a turnaround for the slow-selling programme. But it represents perhaps a soft rebound in North America, a market that accounts for about half the 220 Avantis delivered. It comes three years after the collapse of the Mubadala subsidiary’s biggest customer, Avantair. The US fractional had been operating more than 50 P180s, with orders for 40 more. The latest order will take Evo production from three this year to five in 2017.
However, Mubadala no longer sees the Pratt & Whitney Canada PT6-powered Avanti – which emerged in the late 1980s and is now on its third iteration – as Piaggio’s vanguard product, at least not in its corporate guise. In July, the Abu Dhabi investment group approved an “industrial plan” that positioned its subsidiary chiefly as a developer of defence and special-mission aircraft based on the P180 platform, including the P.1HH Hammerhead unmanned air vehicle and the manned reconnaissance Multirole Patrol Aircraft, or MPA.
It is a strategic switch that was unveiled under former chief executive Carlo Logli, but will be implemented largely by his successor, Renato Vaghi. The former Piaggio chief operating officer and Leonardo veteran assumed his new role in August, a few weeks after the industrial plan was announced. “We are not moving out of business aviation,” he insists. “To develop a product as sophisticated as P.1HH will need a lot of focus, but we will continue investing in the P180 to improve it. It is a fantastic product, and we want to go on giving the owners the product they deserve.”
Vaghi says that in such “anti-cyclical markets” as defence and business aviation, it is “premature” to speculate on the future balance of the business. The plan is to have two separate lines for commercial and special-mission aircraft at its newly opened factory at Villanova D’Albenga, each with the capacity to build 30 aircraft a year by the end of the decade, reveals Vaghi. Although production at Villanova is under way, with the first Evo to be assembled there delivered in October, that objective seems a long way off. Both special-mission programmes are at their early stages.
Piaggio has a contract with Abu Dhabi Autonomous System Investments (ADASI) to develop two MPA prototypes, although it does not have any orders. The companies exhibited a ground demonstrator at the Dubai air show last November. The variant has several airframe enhancements over the standard Avanti, with a one-third higher maximum take-off weight at 7,480kg (16,500lb) – thanks to an extended wingspan, canard and tailplane, and a 950shp version of the P&WC engine. Other additions include a sophisticated avionics suite and Saab-developed mission control system.
The P.1HH is even more ambitious. A medium-altitude, long-endurance platform – with a Leonardo-developed mission system – the variant was unveiled at the Paris air show in 2013. Helped undoubtedly by Mubadala’s influence, Piaggio has orders for eight Hammerheads from the United Arab Emirates. However, an earlier reported order from the Italian government appears to have been downgraded to an expression of “great interest”, with Rome “facilitating the development of the programme” by supporting P.1HH activities taking place at Sicily’s Trapani air base.
Further commitments have proven harder to obtain, although efforts continue. “We’ve spoken to a lot of air forces and had a lot of interest. It may be necessary for the platform to be at a more advanced stage,” says Vaghi. A crash on 31 May of the single prototype off Sicily about 100h into the flight test programme has proved a setback, although Vaghi is sanguine. “The investigation has concluded and these things can happen. We are rebasing the entire programme with our partners and are completing the second prototype,” he says.
Piaggio now plans to resume flight testing in the “first part of 2017”, initially with the second prototype, followed by “another from the production batch which will accelerate the programme,” says Vaghi. Testing will continue to be in Sicily, with the potential for pilots to be trained in the UAE. However, Vaghi is reluctant to commit to a delivery date to the country. “We are being very cautious about saying when that will be,” he says. “Maybe by the end of the year we will be in a position to be more clear.”
While Piaggio will focus on the special-mission market and continue trying to sell and support the commercial variant of the Avanti, as part of its strategic plan it will divest its engine subassembly and overhaul activities. These have traditionally represented almost a third of its revenues, manufacturing subassemblies chiefly for Pratt & Whitney and carrying out service and overhauls on Rolls-Royce and Honeywell engines for the Italian military. The activity has traditionally provided a bulwark against the fluctuating fortunes of the business aviation sector.
However, Vaghi says developing the new platforms will absorb much of Piaggio’s energies and the engine business was not seen as core. Although it is established at Villanova, the factory layout means the division can be hived-off as a going concern, with the new owner taking on the workforce and tenancy of that part of the building. Negotiations are taking place with prospective buyers in consultation with P&W, and Vaghi says Piaggio wants to divest the business “ideally by next year”. He cautions, however: “We want to do things gradually and make sure the transfer works.”
The Villanova factory – opened last year and employing 900 people with a further 130 contractors, including the engine business – was a major “commitment to the future” by Mubadala, which has been “an extremely supportive shareholder to Piaggio management”, says Vaghi. The greenfield development next to the town’s small airport replaced a nearly century-old parts production plant in Finale Ligure, nearby on the country’s scenic northern Mediterranean coast, and an assembly site and head office at Genoa airport, part of which remains as a delivery centre.
The focus is now to make sure, says Vaghi, that the new factory “stands on its feet”. The first Evo to be produced at Villanova – delivered to the Gulf conglomerate Al Saif Group in October – was a “highly symbolic” aircraft in terms of Piaggio’s evolution, maintains Vaghi. Not only had Al Saif – which Piaggio appointed earlier this year as its new sales agent for the Avanti in the region – bought all three versions of the P180, but the example itself included parts made in Finale Ligure and subassemblies in Genoa.
The Villanova investment also dispels suggestions that Mubadala bought Piaggio as a stepping stone to developing an aircraft design and manufacturing expertise in Abu Dhabi. Although the emirate has been building its own aerospace sector in recent years, “an industrial footprint [for Piaggio] in the UAE is not on the table today”, says Vaghi.
Italian technology export restrictions on the special mission programmes are major barriers. “There are rules that need to be followed,” he says. “It does not mean that there will never be some form of industrial co-operation, but it’s not an option today.”
Vaghi admits Piaggio faces an uphill battle to establish itself in the defence market and re-establish itself in a business aircraft market where it has, at best, been a strong niche player along with the likes of Pilatus and Daher. At worst, it has faced extinction. “It is very important to build credibility step by step,” he says. “We have had challenging years, but with challenges come opportunities. Our processes have changed. We have brought in people on the military side. We need to take the supply chain with us, but we really think we have the right management team to take us forward.”
Source: Flight International
