HELO MARKET TRENDS
Helicopter manufacturers step up corporate use capabilities
Speed, range, pax comfort, all-weather availability dominate new civil designs.
Bell's first all-new civil model in decades, the 429 is challenging Eurocopter's strong EC 135.
AgustaWestland has long relied on its A109 family for the bulk of its civil market presence. This has been expanded to a wide variety of variants, incorporating greater range and engine power.
The single-engine version, the AW119 Koala, is now available with more power as the 119 Ke (for Koala enhanced). The baseline 109 is now available as the larger 109 Grand, updated as the Grand New in 2010 with a new avionics package.
AgustaWestland's new, heavier product, of course, is the AW139. Deliveries of this popular machine began in 2005, helping to double the company's civil market share to the 30% range in 2007–10.
The company will capitalize on its success with its proposed AW169, a light twin positioned between the Grand and the 139. Announced in Jul 2010 at Farnborough, it is forecast to arrive in 2015. The AW169 competes with Eurocopter's Dauphin series.
The best illustration of AgustaWestland's determination to expand its product line is its Jun 2011 acquisition of the entire Bell/Agusta BA609 tiltotor program. This niche product, with its uncertain market appeal, had been given relatively low priority by Bell, which held a dominant 2/3 share of the program.
Now that it is controlled entirely by AgustaWestland, it will be brought to market by 2015, although its market standing remains highly uncertain.
Bell and Sikorsky
Eurocopter's strength has been accompanied by a notable civil market decline at Textron's Bell Helicopter unit. Bell's civil helicopter market share averaged around 30% in 1992–98, but this has fallen to an average of 16% over the past 10 years. Teal Group forecasts the company's civil market presence to average 13.6% over the next 10 years.
The problem for Bell has simply been a neglect of its product line. The 417, a major upgrade and re-engining of the popular 407, was cancelled in Mar 2007 due to development problems with its similarly doomed military cousin, the US Army's ARH70 armed reconnaissance helicopter.
Bell sold the BA609 to AgustaWestland in Jun 2011. The Model 427 medium twin proved disappointing and is now dead. On the positive side, its all-new replacement model, the 429, while delayed by about 2 years, now appears to be meeting with a very positive market response. However, Eurocopter's EC 135 has already achieved a dominant position in this segment.
Bell's only lead over Eurocopter is in the installed base. Bell models comprise around 40% of the world fleet—but, given Eurocopter's strong new build lead, this advantage is eroding fast.
Bell has announced a number of initiatives designed to rectify this product line neglect. The first is a new medium twin to replace its share of AgustaWestland's AW139. (Bell divested its share of this successful model in Nov 2005.) Known as Magellan, this possible new model could also compliment or replace the company's long-running and highly successful model 412, a utility workhorse.
Alternatively, it may size this new twin larger than the 139, going after the EC 175 and leaving the 412 to hold its current market niche (presumably with upgrades).
While delayed several years, Sikorsky's new S76D model looks set to continue the S76 series' strong position in corporate and other segments.
Sikorsky has long held a strong position in 2 segments within the market with its S76 and S92. Sikorsky also offers the Schweizer family turbines, in limited production for civil needs. Remarkably, for 4 years in the past decade Sikorsky succeeded in displacing Bell for the number 3 civil market position.
Propelled by strong corporate and government demand, S76 deliveries reached new highs in 2007–09, with production approaching 1 per week.
Given the company's very strong military market revenue, there's also the possibility of new clean sheet Sikorsky civil designs, but right now the company is only proceeding with product updates.
The most recent of these is the S76D, with deliveries beginning in 1Q2012 after a 4-year delay.
Size versus speed
The upper midsize twin segment is the most promising part of the civil helicopter market in terms of new product development, new technology and growth potential. This zone, bracketed at the bottom end by AgustaWestland's AW139 and at the top by Eurocopter's Super Puma, has long been something of a hole in manufacturer product lines.
But, driven by more demanding offshore oil operator needs (and high oil prices), among other factors, manufacturers are racing to fill the gap.
First, it's worth noting the tremendous success enjoyed by the 139—the first model to exploit the potential market directly above Bell's 412. Launched in 1999, AW139 deliveries began in Mar 2004. The 400th 139 was delivered in Jun 2011. More than 500 have been sold.
Eurocopter's EC 175 was a competitive response to this success. As noted above, the program was launched with China's help, while AgustaWestland recruited Russia as a partner. (Russia now hosts an AW139 production line, while China will build the EC 175 as the Avicopter Z15.)
To outflank the EC 175, at the 2011 Paris Air Show AgustaWestland announced the AW189—a stretched civil model derived from the AW149, itself a military growth version of the 139. While AgustaWestland describes the AW189 as a "minimal risk" program, it also describes the 149 and 189 as 2 different helicopters. The 189 is being targeted initially at the long-range offshore oil market. A prototype is scheduled to fly in Nov 2011, with certification expected in late 2013.
Bell, which had been counting on its 1/3 share of the AB139 (as it was known prior to Bell's exit in 2005) to enter this segment, has begun consideration of its new Magellan, as discussed above. This could serve as a model 412 replacement [?], possibly moving into the AW139's territory, or even the AW189's. However, right now no firm plans or dates have been announced for Magellan.
There are also new programs to leverage technology to meet market needs in this segment, relying on smaller machines with greater speed (and therefore productivity and range). While smaller, these new developments, if brought to market, will likely sell in the same price range as the new larger medium models ($15–22 million).