Rotor lift

To gain a snapshot of the industry in 2011, Australian Aviation interviewed several locally based helicopter sales companies and support firms to canvass their opinions on the state of the industry since 2009. More specifically, topics included how each company has managed in the way of sales, orders or providing services, what kind market sectors are generating the most business activity, and where the Australian rotary wing industry is headed.

Hawker Pacific

Among the many strings to its bow, Hawker Pacific is the Australian and New Zealand representative for Bell Helicopter.

Senior vice president, aircraft sales and flight services group, Tony Jones, categorised the helicopter industry as “resilient”, and demonstrating signs of improvement.

Jones cited Hawker Pacific’s introduction of the new Bell 429 into the Australasian market as evidence of that resilience despite the GFC. A two-week 2010 demo tour of the helicopter confirmed a high level of interest from Defence, police and EMS operators, with New Zealand’s Advanced Flight Ltd becoming the first local customer to take delivery of a 429 late last year. Otherwise, it has been a time of “steady sales” for Hawker since 2009.

“The Bell product range is very strong in the EMS and corporate markets, whilst we see a lot of our used aircraft going to charter and utility operators,” Jones said.

“The Bell 206 and 407 continue to be an increasingly popular aircraft, with deliveries into Australia and Papua New Guinea.

“This year, Bell has introduced the Bell 407GX, equipped with Garmin G1000 avionics. We expect this aircraft to experience a similar, if not increased, success in the market that its predecessor, the Bell 407, enjoys. ” Jones highlights “more capability” and “greater safety” as two key concerns for helicopter owners and operators looking, as always, to get more bang for their buck.

“This is not new of course,” he noted.

“However, technology is making a huge impact on areas like reduced pilot workload, greater situational awareness, increased engine and component reliability and reduced maintenance activities with greater predictability. As a result, I’m confident the industry has a very healthy future. ”

Heliflite

“The helicopter industry has just come through one of its most turbulent periods with the GFC,” noted Heliflite’s Helicopter Sales spokesman, Scott Edmonds.

“The GFC significantly hit the helicopter industry with a collapsing Australian currency, reduced asset and stock values, plus an almost immediate halt to new aircraft photo –financing by the banking industry. ” One of three Australian Robinson dealers and Australia’s exclusive AgustaWestland distributor, Heliflite has recorded a notable increase in sales and orders for the first quarter of 2011, helped by a strong Australian dollar and a now more flexible finance industry.

“Sales figures compared to 2008-2009 are up on all Robinson models,” Edmonds said, while also noting “renewed interest in the full range of Agusta helicopters, particularly EMS/SAR and offshore with the AW139”.

Edmonds spoke of renewed interest from the corporate market for Heliflite’s Agusta range, tipping that future sales activity to increase with the roll-out of the new AW169 light utility, twin-engine helicopter in coming years.

“The AW169 will provide a significant improvement in performance, safety and multi-mission capability to this market segment, so much so that Agusta has brought forward the certification program on the helicopter by 12 months, to have it available now from 2014,” Edmonds said, adding that orders for the AW169 are being taken from all market segments.

Robinson’s new five-seat R66 Turbine, of which Heliflite was the first Australian company to take delivery of one in February, has also garnered interest in the private and commercial markets, with a “strong global demand” pushing out a factory lead time to March 2012 for the helicopter.

Heliflite cites the rural sector as its primary Robinson client base, underlined by the “growing trend of R44s for private station use”.

“There has been a growing number of mining related businesses, commercial and private owners purchasing Robinsons, especially the value for money choice – R44 Raven I,” Edmonds said.

“On the AgustaWestland side of the business, the VIP/corporate and EMS/ SAR operators have long been the clientele for that aircraft type. ” One such operator is Emergency Management Queensland’s Helicopter Rescue Service, which currently operates three AW139s, alongside two Bell 412s in support (see our feature from p52).

As for the future, Heliflite remains confident.

“Overall, we see a positive outlook for the Australian helicopter industry with a strong resources and rural sector, plus operators having the benefit of new products entering the market, including the R66 Turbine and AW169. ”

Helibiz

Sales and marketing manager for the Queensland based helicopter sales, maintenance and training firm Helibiz Troy Holloway sees the commercial side of the industry as resilient in the post-GFC market, but with private sales predictably still suffering a downturn since 2009.

“Commercially, the rotary wing industry is going well, with the strong mining and resources sector being one of the largest growth areas. Other fields, such as EMS, are also expanding to service more regional areas around Australia,” Holloway noted.

“The private sector has taken a bit of a plunge with the GFC, so we’ve definitely sold less helicopters over the past couple of years than what we have done in the previous two. But we are confident that it’s going to pick up and especially with the exceptional strength of the Aussie dollar.

“Some potential helicopter customers have found it difficult arranging finance due to changes in borrowing policies, and it appears gone are the days of unsecured finance, yet most major banks are revealing record profits.

“All other sectors of our business have experienced fantastic growth, whereas sales have reduced to probably 35-40 per cent. ” That figure extends to both new and used helicopters, with Helibiz an authorised Robinson dealer, as well as marketing used Bell and Eurocopter models.

“The last couple of years have been slightly different as sales have generally been slower across the board. Both new and used have seen a decline, and again, the GFC has made a lot of people nervous about spending money, and as always, lifestyle purchases always get hit first. ” Despite the drop off in sales since the GFC, Helibiz has seen a solid 2010 financial year, with the company’s training arm growing at its three principal locations at the Gold Coast, Mackay and Airlie Beach.

Customer-wise, Holloway categorised the “helicopter enthusiast” and successful businessman as part of Helibiz’s key customer base, with the rural and mining sectors playing a significant part in that market.

“A lot of these guys, especially in the mining sectors and in Queensland and remote areas, they’re spending so much time on the road, having a helicopter reduces that block by one fifth of the time they’re in transit,” Holloway said.

Helibiz remains optimistic that the private market sales will eventually return to pre-GFC levels, but “it’s anyone’s guess how long that will take,” Holloway admits.

“We were all dealing with a hugedemand in the boom, but like every boom there’s always a bust, so it mightn’t get up to those sorts of [pre-GFC] levels for maybe a few years. I believe good steady growth is the best growth to have because it’s all very manageable.

“I’m extremely confident that the rotary wing industry will continue to grow, especially with new developments from a variety of manufacturers. Helicopters are getting lighter, faster and more fuel efficient.

Requirements for helicopters are expanding in all sectors including military, law enforcement, rescue, tourism, mining, cattle mustering and emergency services. . . They’re [helicopters] definitely cheap enough now, with the Aussie dollar being parity with the US dollar, and the private. . . market is really enjoying having a helicopter,” he said.

“Realistically, they’re the perfect recreational vehicle,” Holloway concluded.

Australian Aerospace

A key player in the local industry, Eurocopter’s Australian subsidiary Australian Aerospace, has found itself in a strong market position despite the GFC, given its presence in both civil and military markets.

Yet despite accounting for 86 per cent of new helicopter deliveries in Australia during 2010 (as well as 100 per cent of deliveries in New Zealand), the company has still felt the impact of a dwindling private/ corporate market.

“Australian Aerospace deliveries continued to meet pre-GFC levels. However, as expected, bookings were down on previous years,” the company said in response to Australian Aviation’s questions.

“The continued resources boom has seen increased interest in the oil and gas exploration sector and parapublic programs (including police, search and rescue and medevac) continue as planned. ” While helicopter deliveries have been solid, Australian Aerospace expects deliveries to slow over the next 12 months, before orders pick up due to a tightening second hand market “Australia’s market is mixed between private/corporate, commercial, parapublic and oil and gas exploration,” the company assessed.

“Over the coming years we anticipate strong interest from the oil and gas sector, particularly in Western Australia, as the mining industry continues to grow.

New Zealand has the highest number of helicopters per capita of any country. The majority of these helicopters are used in the tourism and parapublic sectors (search and rescue), and Australian Aerospace expects that this trend will continue. ” Interest in new helicopter purchases has also been aided by the introduction of Eurocopter’s new medium lift EC175, marketed initially to the offshore oil and gas industry. Deliveries of that helicopter are expected to begin in 2012.

“The EC175 has great potential locally for the parapublic and offshore markets thanks to its great payload and range capabilities.

The aircraft has been discussed with several Australian customers and was very well received,” Australian Aerospace said.

“The Eurocopter Group has registered confirmed interest for more than 100 aircraft, including several in the Australian Aerospace region. ” Looking ahead, Australian Aerospace highlighted “continued strong demand from the parapublic and offshore sectors”,and expects sales from commercial, private and tourism operators to continue their return to pre-GFC levels.

Sikorsky-Helitech

Offering specialised services and throughlife support to a number of military and civilian helicopter operators, Sikorsky- Helitech has an upbeat industry outlook.

“We’re looking forward to what we expect to be exciting times in both the military and civil sectors in the near future,” director of maritime and Asia strategies, Sikorsky Aerospace Services, Chris Clapperton said.

“Sikorsky-Helitech has been in the industry for over 50 years, and over that period of time, we’ve seen a lot of changes, and like many industries, the businesses have seen its cycles ebb and flow. ” Sikorsky-Helitech is a unit of Sikorsky Aerospace Services (SAS), the integrated aftermarket support arm of Sikorsky Aircraft.

SAS currently offers various support services for rotary and fixed wing aircraft in more than 75 countries.

“Globally, the reliance on helicopters has actually grown over the years,” Clapperton continued.

“When you think about it, in Australia we’ve had first hand experience in all of these areas. We’ve got military deployments overseas. We’ve got the offshore oil and gas, they’re growing markets particularly, up the North West Shelf. And then we’ve got the rescue services,” he said.

“We’re one of the few organisations, if not the only organisation in Australia, that does civil and military helicopters within the one facility,” Clapperton noted.

“That allows us to be extremely competitive and efficient, because we’ve gone through the pain of getting all the procedures and processes and everything in place to leverage both sides of that business. It also allows us to manage the resources, because we can have our people working on a civil design one day. . . . [and] a military one the next, the same applies to our service centre where they’re doing the maintenance. ” With an approximately 60-40 military civil business mix and employing approximately 180 staff across various Australian military bases and at its main facility in Pinkenba, Brisbane, Sikorsky-Helitech divides its support network into five main business functions – logistics, engineering, component repair and overhaul, aircraft maintenance, and training. All functions have brought a “consistent and steady flow of business”, according to Clapperton, helped in part by high flying hours done by helicopters in both military and civilian service. That is confirmed by Sikorsky-Helitech managing director George Cheetham.

“The demand has been constant because most of our customers are either the military, where the demand/flying activity has actually increased on the military fleets in the last couple of years. And on the civil side with the emergency services, because of the [recent] natural disasters, they’ve been flying more hours,” Cheetham noted.

“The only real dip we’ve seen has been in the civil corporate market, but this is only a very small percentage of the overall global helicopter market,” Clapperton added.

“From a Sikorsky-Helitech perspective, it’s had almost no effect, because there’s not a lot of corporate helicopters in Australia or in the region. So really, Sikorsky’s come through the whole thing fairly well unscathed,” he said.

One specific area in the civil sector where the company sees good potential for growth is once again the growing offshore oil and gas market in Australia’s north-west.

“Offshore oil and gas has always been a big sector for Sikorsky. And we’re already established and based here with maintenance capability in Australia, which puts us in a good position to support that activity,” Cheetham said.

“Now it’s early days on that to see how that develops and how the support structure needs to be put in place, but it’s something we’re focused on and we see that as future growth and very encouraging. ” Authorised to service both Sikorsky and Bell helicopters, Sikorsky-Helitech deals predominantly with larger civil operators, such as those in the SAR/EMS sectors or other utility roles. It’s a market which is only growing, according to Cheetham.

“We’ve seen in Australia over the last few years, the number of natural disasters and the role that helicopters could have played and have played during those natural disasters, and I don’t see that getting any less. I think that’s made people have a heightened focus on the use of helicopters, and the role of helicopters in those situations,” he said.

“It’s a good market. It’s a steady market.

They fly the hours. . . They’re the types of customers . . . that we have. Larger helicopters, the ones who want their helicopter maintained by the OEM and their components maintained by the OEM. ” “Interesting times ahead,” is how Clapperton sees the future of the industry, highlighting “the possibilities of significant expansion throughout Australia”.

“Particularly on the military side, with the introduction of new fleets, some of the companies that are involved in the helicopter industry may change with the change-out of those aircraft types. Overall, the future appears positive and we’re looking forward to what it brings. ”

Outlook

Nearly three years on from the onset of the GFC, the Australian helicopter industry looks to have weathered the storm, and now has a strong Australian dollar to encourage new sales. Overall, the mood of those who support the industry through sales and service is positive, with growing demand for helicopters in the rural, mining and offshore oil and gas markets.

“The only real dip we’ve seen has been in the corporate market, but this is only a very small percentage of the overall global helicopter market.”