Eurocopter upping R&D in face of market unpredictability

European helicopter house Eurocopter is stepping up research and development (R&D) as part of a three-pronged approach to dealing to the current global economic crisis that has already badly affected the aviation and airline industries.
Eurocopter CEO Lutz Bertling says this will allow the rotorcraft giant to prepare the next generation of helicopters.
He note that last year Eurocopter boosted self-funded R&D expenditure by 40%. One of the focal points of the company`s R&D efforts is environmental compatibility. Eurocopter is currently participating in several pan-European programmes for a “Green Helicopter”. It is also researching the use of diesel engines on light helicopters.

In addition, Eurocopter carried out first flights with an unmanned helicopter, up to now the preoccupation of niche players such as Schiebel.  
Bertling adds that the EADS subsidiary will also closely monitor the crisis and mitigate its effects by “maintaining maximum flexibility” as well as supporting key customers in obtaining finance.
The company will thirdly seek to move beyond manufacture. “It is our aim to raise the contribution of support and services to 50% of our turnover by 2020,” Bertling says.
“We have taken first steps towards this goal in 2008 through the acquisition of Motorflug. We invested heavily in training facilities, notably through simulators. …Eurocopter is well on its way to becoming a full services provider.”

2008 results
Bertling made the comments while announcing the company`s 2008 results, which “fully met … objectives” with 588 helicopters delivered to military and civil customers.
“This figure constitutes a production ramp-up of 20% percent as compared to 2007 and reinforced its position as a major branded business division within EADS, counting for a consolidated turnover of €4.5 billion.

“Order bookings, still showing strong demand for new helicopter models and services, amounted to €4.9 billion. This included 715 new aircraft:
-          85 units of EC120 Colibri

-          340 units of the AS350/355 Ecureuil/Fennec/EC130 family

-          123 units of EC135

-          81 units of EC145
-          39 units of the Dauphin/Panther/EC155 family

The company`s total order backlog by the end of December 2008 was over €14 billion or the equivalent of 1550 helicopters.

Fifty-five percent of turnover (€2.48 billion) was sales related, 32% (€1.45 billion) derived from support and services while 13% (€0.56 billion) was realised from development and other activities. The company says 55% of sales were civil and “parapublic” (police, government, paramilitary) and 45% was military.
“The company thereby retained its healthy balance between the civil and military markets. he export share is 65% percent, with 35% achieved in the company`s domestic markets (France, Germany and Spain), proving Eurocopter`s successful strategy of expanding its activities to emerging markets.

Product developments 
Product developments included Eurocopter fully qualifying the Tiger attack helicopter in its general purpose and tank-busting variants and ramping up NH90 production with first deliveries from the Finnish and Australian assembly lines.

Eurocopter also delivered its 50th UH-72A Lakota to the US Army in December and won the US Navy as an additional customer for the Lakota. “This makes Eurocopter one of the very few European companies to have built up a sustained supplier relationship with the US Armed Forces.
Production of the first EC175 prototype co-developed with Chinese partners was launched.

“I cannot emphasize strongly enough that our global industrial strategy is a backbone of our market and business strength,” Bertling added. “We created our 18th subsidiary in Indonesia, linked to the manufacturing of Super Puma airframes in that country, and we enlarged our facilities in Canada, the UK and in South Africa.
“We also delivered the first Spanish-produced EC135 from our Albacete facility. Even if it is not yet in the 2008 results, our recent achievement of signing for the production of 50 EC725 in Brazil is the result of a long-standing relationship, combined with a production facility.”