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Airbus Helicopters reports 2014 progress amid changing market dynamics

By Vertical Mag | January 27, 2015

Estimated reading time 5 minutes, 51 seconds.


Airbus Helicopters had a backlog of 900 helicopters at the end of 2014. While that’s 100 fewer helicopters than in 2013, there is a higher number of larger helicopter types, like the EC225, that are on order than over the previous year. Anthony Pecchi Photo

Guillaume Faury presented Airbus Helicopters’ 2014 results on Jan. 27 in Paris, for the second time during his tenure as CEO. Going from Eurocopter to Airbus Helicopters is “not only a change in name, but also a project to change the company, and fully integrate it into Airbus Group,” said Guillaume Faury, introducing the press conference.  

The Airbus Helicopters CEO was quick to point out that 2014 had been a busy year, with three new helicopters certified, delivered and pressed into service: the EC135 T3/P3, the EC145 T2 and the much-awaited EC175, with the first two production aircraft delivered to Noordzee Helikopters Vlaanderen (NHV) and the third to UTair.

Last year, Airbus Helicopters delivered 471 helicopters, the lowest figure since 2006, when Eurocopter reached a low of 381. Two years later, in 2008, the company reached a staggering high of 588. Since 2010, the company hovers around the 500 delivery mark and a stable market share: 44 percent on the civil and parapublic market in terms of aircraft delivered (a result equal to Bell, AgustaWestland and Sikorsky combined) and 11 percent on the military market, behind Sikorsky, Russian Helicopters and Boeing.

Beyond the raw figure, the good news for Airbus Helicopters and its cash flow is the significant shift in the business — fewer light singles delivered and more (expensive) heavies. Airbus Helicopters delivered 53 NH90s last year, and 48 aircraft from the Super Puma/EC225 and EC725 family. On the booking side, Airbus Helicopters raked in 402 orders (see the breakdown).


Breakdown of bookings by product family for 2014. Airbus Helicopters Graphic

Faury also highlighted a strong order backlog, reaching 900 helicopters at the end of 2014. That’s 100 lower than at the end of 2013, but once again heavies are replacing smaller and cheaper light singles. After a much-awaited certification in early 2014, Airbus Helicopters is expecting to reap the dividends of its effort with the EC175. Only eight of the model were sold in 2014, but Airbus Helicopters is counting on the aircraft’s very satisfying entry-into-service (85 percent availability from day one with NHV, with a strong tempo of operations) to clear commercial turbulence and convince future customers.

However, the EC175 is now facing two hurdles: the uncertain situation in Russia and the drop in oil prices. Russian customer UTair, which received its first EC175 late last year, is experiencing difficulties in a weak economy and is putting further EC175 deliveries on hold, “waiting for more clarity,” said Faury. Meanwhile, when asked about the commercial impact of the drop in crude oil and natural gas prices, the CEO noted that 15 percent of Airbus Helicopters’ business comes from the oil and gas business, with a market share of 25 percent. “On a short term, lots of projects can be frozen and affect our sales, but on the other hand, weak prices can be an opportunity for our flagships like the EC175 and the new EC225e, which bring very effective cost solutions for long-range operations,” he said.
 
Faury remains optimistic for 2015, which he said will bring some important opportunities for Airbus Helicopters with major government campaigns (which were comparatively lacking in 2014, translating into below-average sales figures). Decisions are expected in Poland (which is seeking to procure 70 multi-mission helicopters), Korea (which is seeking a foreign partner for a Light Commercial Helicopter and Light Armed Helicopter) and Kuwait (which has a need for 24 transport helicopters). Winning one or more of these campaigns will help Airbus Helicopters maintain its backlog for heavy helicopters at a satisfactory level. A fourth major campaign, held in Qatar, should bring some good news soon, since Doha signed a letter of intent in March 2014 for 22 NH90s. The contract, which is said to be in the final negotiation phase, could be signed in the coming weeks.

Another major milestone for 2015 concerns the X4: a full-size mock up will on display in Orlando during Heli-Expo 2015 in March, and its official name will be announced there. The next-generation aircraft in Airbus Helicopters’ Dauphin family, the X4 powered on at the end of November 2014, and first flight of the prototype is expected later this year. 
In the meantime, Airbus Helicopters told Vertical that it has ended the AS365 N3e upgrade project and is instead concentrating its efforts for the Dauphin family civil market on the AS365 N3+ and EC155 B1, with a focus on very short delivery lead times and competitive prices. On the military side, the company will pursue development of the AS565 MBe Panther with a maximum takeoff weight of 4.5 tons and improved AEO/OEI performance to deliver a cost-effective naval, search-and-rescue, and maritime surveillance/counter-terrorism platform.
 

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