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European Helo Makers Shift Production Abroad

European Helo Makers Shift Production Abroad

Europe´s helicopter industry is headed for a significant structural shift as manufacturers expand abroad to reap a higher return on their euro investments.

The moves by AgustaWestland, Eurocopter and turboshaft maker Turbomeca mirror changes under way at parent companies EADS, Finmeccanica and Safran, which are rapidly shifting production into dollar-zone countries to reduce their exposure to the rising euro. But the particular nature of the rotorcraft industry, with virtually all rival airframers and engine makers located in the U.S., is putting even more pressure on helicopter manufacturers.

Another motivation is the sizzling pace of growth in the rotorcraft industry, which is pushing companies to wring more profit out of rising sales. The pace of growth also permits management to skirt Europe´s aggressive unions by shifting new, rather than existing business, overseas, executives say. Also facilitating the dollar zone expansion drive is the fact that European companies have long had a strong presence in the U.S. and have moved aggressively in recent years to establish themselves as dependable suppliers to the U.S. government and military.

On Feb. 19, AgustaWestland opened a 50,000 square-foot expansion of its existing production facility in Philadelphia that will allow it to increase parts production and assemble the popular AW139. When the new assembly line opens, the plant will employ 500 people, up from 200 in 2005, when the company began assembling the AW119 Koala there. The facility produces $ 100 million worth of components and parts for use at AugstaWestland plants in Italy and the U.K.

Eurocopter has moved to expand its base in Grand Prairie, Texas, and recently opened a new plant in Mississippi, where it is assembling the EC 135 and the U.S. Army´s Light Uility Helicopter. The Army award is for 322 aircraft, but CEO Lutz Bertling thinks demand within the Army and other services and agencies will drive that number up.

Engine maker Turbomeca has doubled capacity at its Grand Prairie, Texas, plant, to 137,000 square feet, and last year assembled 550 engines there. It recently started work on a new plant in Monroe, N.C., that is expected to go on stream by year´s end. The million, 100,000-square-foot facility will produce turbine blades, rotating parts, and fabricated parts and employ 180 people to start, CEO Emric d´Arcimoles says.

The facility is Turbomeca´s first component facility in the U.S., and except for a joint venture plant in South Africa, the first outside France.

/ Новости