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Thursday, March 1, 2012

People Drive Recovery, Not Just Products

By Andrew Parker, Editor-in-Chief

Writing this while on a plane back from Dallas after a busy and eventful Heli-Expo, I’m finally getting the chance to finish a thought that struck me early on during the non-stop four-day event.

Let’s be honest—the world’s largest rotorcraft event is about people. As much as “the blitz” of new helicopters, equipment, upgrades, technology developments, STC programs and the spectrum of unveilings is important to the helicopter industry, people are what drive the economy, and the slow but steady recovery that many are predicting.

It was the first Heli-Expo in a long time where industry legend Frank Robinson didn’t make an appearance, with CEO Kurt Robinson—resembling his dad—talking about a doubling of production and a positive response to the R66 turbine.

“Businesses are just people,” said Lynn Tilton, owner of MD Helicopters, during her annual press conference.

“In the end, across 76 companies, I can tell you, our success is determined by the people who stand together to move [the company] forward into the future.”

Bell CEO John Garrison emphasized the importance of people in the development of the 525 Relentless, with hundreds of the company’s employees in attendance wearing black shirts with a red “R” during the Feb. 12 launch.

Russian Helicopters CEO Dmitry Petrov reported that the company’s group of a dozen subsidiaries produced 265 helicopters during 2011. Russian Helicopters employs around 40,000 people in total.

“This year we will produce more than 300,” he explained, “so our sales and output will experience a steady level of growth of about 20 percent annually, in terms of both units and revenue.”

Petrov predicts that Russian Helicopters will “maintain the same pace in the coming years. Why I can be confident in saying this is we have an extensive and diversified firm order backlog,” including, on the military side, with the Russian Ministry of Defence through 2020.

“We’ve also experienced great sales in the domestic market—civil helicopters both for exports and for large commercial operators inside Russia.” As a result, the company’s sales are expected to reach approximately U.S. $5 billion, Petrov added.

People are a big part of NetJets founder and former CEO Richard Santulli’s success. All of his senior management team “came with me” to his latest venture, Milestone Aviation Group, a helicopter leasing company that was founded in 2010 after raising $500 million in private equity. Santulli is chairman of the Dublin-based company.

During Heli-Expo, Milestone announced orders for 16 Eurocopter EC225s and three Sikorsky S-92s, in addition to establishing a global support partnership with Turbomeca covering engines and maintenance. Santulli also noted recent agreements worth $25 million with Bristow and $75 million with CHC.

Santulli explained that after leaving NetJets, his team asked whether the business jet market was really a sustainable long-term business due to its cyclical nature.

“We went back and looked at the helicopter business at the same time and realized that of the four major OEMs, only one had a financing company under its belt. The other three didn’t,” he said. “When we studied the oil and gas business, and EMS, we realized that there’s a leasing demand, especially globally.”

Back to the point: The helicopter community resembles a family—albeit more of a large, extended family with lots of squabbling, internal rifts over viewpoints and discussions about how to best improve safety—but a family no less.

The people in this industry are what makes it so dynamic, and what drives much of the dedication that goes into making helicopters as safe and reliable as possible. The International Helicopter Safety Team (IHST) continues to push forward with efforts to reduce the accident rate by 80 percent, adding a new partner, Russia and the CIS, to the global effort to increase safety. (See story on page 26.)

Of course, helicopters and equipment—the “nuts and bolts,” if you will—are major drivers of the economy. While each year’s new product releases and updates are very important, as simple as it sounds and as many times as it’s been said, it all boils down to people.

For more photos, videos and post-show news from Heli-Expo 2012, visit www.rotorandwing.com and our dedicated landing page for the event: www.aviationtoday.com/rw/heliexpo2012

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