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Thursday, May 1, 2008

MD Move Would Require FAA Production Recertification

NEWS

Any move of MD Helicopters’ production lines from their current Mesa, Ariz. site would require re-certification by the FAA.

That process could take anywhere from weeks to a year, according to agency officials. It is unclear whether MD would keep existing production lines running until the FAA approved use of the new ones to maintain delivery schedules during recertification. The company did not return repeated calls for comment.

The New York distressed-debt investor who bought MD in mid-2005 and now serves as its chairman and CEO, Lynn Tilton, said at Heli-Expo in February that the company would deliver 60 aircraft this year. It delivered 32 in 2007.

Based at Falcon Field in Mesa, MD is reportedly at an impasse with Mesa officials over a proposed rent increase for its 30-acre site. For several months, MD has had a real estate representative soliciting relocation bids from other locales seeking to host the manufacturer’s operations.

Tilton has said she will relocate the completions shop Heritage Aviation, which she also owns, from Grand Prairie, Texas to the new MD site. She also has said she plans to acquire a very light jet manufacturer and move it to that site.

Regardless of where MD decides to move, the FAA would have to convene a board of inspectors to certify that the new production facility and all its equipment are capable of building safe aircraft. In addition to obtaining a type certificate from the FAA for each unique aircraft it produces, a manufacturer generally must secure a production certificate to build the aircraft. That document certifies that the manufacturer has satisfied the FAA that it has established and can maintain a quality-control system that ensures that each aircraft produced will comply with the pertinent type certificate.

According to Federal Aviation Regulation 21.159, a production certificate is valid until it is surrendered by the manufacturer, it is suspended, revoked or terminated by the FAA, "or the location of the manufacturing facility is changed."

Recertification of a manufacturer’s production certificates by an FAA review panel can take anywhere from several weeks to a year, according to agency officials, depending on the size of the production facility and the complexity of its operations.

MD reportedly is seeking a 100-acre site on which it can expand its production line and host a training facility as well as Heritage and the very light jet maker.

TIlton reportedly has visited, as potential MD homes, North Texas Regional/Perrin Field north of Dallas, Phoenix-Mesa Gateway Airport south of Falcon Field, Shreveport, La. Regional Airport, and Will Rogers World Airport in Oklahoma City. — Ernie Stephens

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