NH90 Faces Up To European Budget Cuts

By Tony Osborne
Source: Aviation Week & Space Technology
June 17, 2013
Credit: Eurocopter

Like all complex European aircraft procurements, the NH90 helicopter program has seen its fair share of strife.

Seen as a new generation of helicopter for the 21st century, the program has been beset by complexity, political interference and the economic downturn, as European defense budgets have nose-dived. Yet, officials close to the project point out that the aircraft is now gaining combat experience, and that there is a very real chance for a new wave of export contracts.

More than 140 of the twin-engine helicopters have now been delivered to 12 of the 14 customers. Over the last three years, NH Industries, a joint venture of AgustaWestland, Eurocopter and Fokker has been delivering around 30 of the helicopters a year, but the consortium is ramping up production levels with the aim of delivering between 40 and 50 this year, and up to 60 in the coming years, giving the company another six years of production backlog.

Deliveries of aircraft with the full operational capability are now well underway. The NH90 is being put through its paces operationally, with five aircraft deployed to western Afghanistan by the Italian army and four being readied for operations in the north of the country by the German army, which will use the type for medevac missions. Operations are due to begin at the end of June. The Netherlands has also deployed one of its aircraft for anti-piracy missions off Somalia, and other nations are using their aircraft for search and rescue.

But the timing of the NH90's introduction could not have been more adverse. The many European governments that rushed to order the aircraft during the last decade were enjoying the wealth that the euro had bought them, but now are struggling to bring their debt under control as a result of the economic crisis. Spain, whose government invested in a new facility to build both the NH90 and Tiger, wants to reduce its NH90 buy to 22 from 45, offsetting the reduced number of aircraft through a logistics deal.

Germany has settled on a deal to reduce the number it is buying to 100 from 122, but this also includes 18 naval helicopters, which were not part of the original deal. Portugal wants to pull out of the program altogether, and the consortium is now negotiating what Lisbon needs to pay in order to exit.

“We are assessing the cost for which they should bear,” says Dominique Maudet, Eurocopter's executive vice president for global business and services. “It is not nothing, it is a significant amount. We are able to ramp up production, but ability for the customers to take delivery of the aircraft formally could be questionable. You need to have helicopters, but you also need customers who are ready to pay. I would not be surprised if some countries smooth out the delivery lines to save a bit of money in the coming years.”

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