Brisk sales of new airline and business aircraft during the past few years have created an order backlog for commercial avionics companies that should help sustain them through 2009, even though economic uncertainty is darkening the horizon.

Universal Avionics offers this LP/LPV monitor box (left) to enable a single WAAS flight management system to be used for a localizer performance with vertical approach.Credit: UNIVERSAL AVIONICS

Business had never been better for many of these companies in this type of avionics, so it will take a while for the effects of the global financial crisis to have an impact in some areas of activity such as delivering avionics to aircraft manufacturers with huge backlogs. The retrofit market will be more susceptible to ill winds, however, especially when it comes to “big-ticket” cockpit makeovers.

Honeywell Aerospace does see the growth of airline flying hours slowing to a rate of less than 1% this year, but not an actual decline as was experienced after the terrorist attacks of 9/11, according to T.K. Kallenbach, Honeywell vice president for marketing and product management. Even though airlines are taking some aircraft out of service, they are flying more hours with the remaining aircraft to make up any shortfall. Rationalization of fleets is being implemented based on the possibility that the per-barrel price of oil again will rise above $100, and so airlines will be more profitable if oil stays cheaper. Uncertainty about the price of oil and general economic conditions make this year a particularly difficult one to forecast for airline activity, Kallenbach says.

In any case, Honeywell expects avionics shipments for “forward fit” on new aircraft to remain strong at Boeing and Airbus as well as at manufacturers of large to mid-size business jets. “The beauty is we have a backlog going out several years in business jets,” Kallenbach says. There is softening, however, for sales for light jets, very light jets and general aviation aircraft.

Kallenbach says production of the Primus Epic line is humming along with more than 500 systems being shipped in 2008. Primus Epic flies on 18 different models of aircraft, including high-end business jets or regional jets and on one helicopter (the AgustaWestland AW139). The aircraft include the Cessna Sovereign; Hawker Beechcraft Hawker 4000; Dassault Falcon 7X, 900DX, 900EX, 2000DX, 2000EX and 2000LX; Embraer 170, 175, 190 and 195; and Gulfstream G350, G450, G500, G650.

In 2008, Rockwell Collins acquired Athena Technologies, which developed integrated control and navigation sensors for UAVs. Rockwell Collins believes this type of advanced technology will play a key role in commercial avionics.Credit: ROCKWELL COLLINS

Honeywell is also continuing to pursue sales of avionics designed to improve situational awareness such as synthetic vision, which is a new type of software that has been ordered for installation on 50 Gulfstream aircraft. In addition, Dassault will use synthetic vision on the EASy Phase 2 cockpit on the Falcon 900, 7X and 2000 series.

One factor that is affecting the market for commercial avionics in new airline aircraft is that Airbus and Boeing are seeking higher levels of systems integration from avionics companies. They are not likely to move to the method used by business jet and regional airliner manufacturers, which farm out the entire cockpit to one avionics company. Still, the shift is changing the dynamics of how commercial avionics systems are marketed and creating opportunities for avionics companies to become Tier-1 suppliers, says Steve Paramore, director of systems marketing for Rockwell Collins. “The original equipment manufacturers won’t let go of the cockpit; that is their bailiwick. But I do see them increasing the size of [work] packages,” he adds.

Thus companies such as Rockwell Collins now at times become the integrators of other companies’ avionics into their subsystems. Rockwell Collins tests whole subsystems before they are shipped to Boeing or Airbus.

The company just won an integration package from Airbus, for example, to provide the entire communications package on the A350. The company also won the “fly-smart system” designed to integrate the aircraft into an airline’s ground-based information management system. Both projects pose significant Tier-1 integration challenges.

They also create more of a winner-take-all environment for avionics on new aircraft models because airlines will no longer be able to choose from a list of radios or radars made by different manufacturers; they will all get the same system. Rockwell Collins won the sole-source contract to supply communications equipment over the life of the A350. “Now we do systems-wide integration rather than just supply a black box,” explains Paramore.

Rockwell Collins also says it expects some avionics sales to be driven over the next five years by the need for aircraft operators to use Required Navigation Performance (RNP) procedures and Automatic Dependent Surveillance-Broadcast (ADS-B). Business jet operators are also interested in RNP, says Tim Rayl, senior director of business and regional systems marketing for Rockwell Collins.

Both RNP and ADS-B require aircraft to have a good source of GPS positioning on board, which in some cases may be a multimode receiver like Rockwell Collins’s GLU-925 Global Landing Systems which provides ILS, GPS and other capabilities. So far, it is mostly business jets and general aviation aircraft that are being equipped with Wide-Area Augmentation System (WAAS) capability for GPS, but Paramore says some airlines are becoming interested in the technology.

Recently, the FAA said it has published 1,333 WAAS approach procedures—more than the total number of ILS approaches in the U.S. But the utility of these procedures is just beginning to dawn on many aircraft operators, according to Universal Avionics. For example, a general aviation pilot talking to a Universal salesman asked why he would need a WAAS GPS to fly LPV (localizer performance with vertical guidance) procedures, since he has an ILS system at his home airfield. Then, the salesman pointed out that a crossing runway now has a published LPV procedure and the owner-pilot said: “Oh.” He bought the system.

In fact, a lot of people are buying flight management systems (FMSs) with WAAS capability from Universal, with the monthly level of orders increasing at times last year by 50-100%. “People are finally hearing about it [WAAS],” says Paul De Herrera, Universal’s chief operating officer.

De Herrera notes that Horizon Air is already updating its Dash 8 fleet with WAAS-capable FMSs from Universal, so it is not entirely a business and general aviation phenomenon. He adds that one reason Horizon wants to use WAAS is that it provides lower minimums at some airports such as Sun Valley, Idaho. Cargo and low-cost airlines also are beginning to show interest in WAAS, as is the U.S. government. In another key area for Universal, the flat-panel retrofit business was “exceptional” last year, but De Herrera believes sales will flatten this year as the global economic downturn puts a damper on big-ticket retrofits. He thinks sales of individual items—such as radios, glass-cockpit displays and FMS units with WAAS—will hold up better than for complete cockpit makeovers.

Another perspective on the business aviation market comes from Roman G. Ptakowski, president of Innovative Solutions & Support Inc. of Exton, Pa. In today’s economy, he believes many business aircraft owners will forgo the purchase of a new aircraft “and won’t be able to sell the one they own.” On the other hand, owners are financially able to operate the aircraft and like to make improvements such as installing flat-panel displays, a business in which IS&S is heavily involved.

IS&S has had great success with its flat-panel installations and has upgraded or has under contract about 300 aircraft from the Pilatus PC-12 to Boeing 767s, Lockheed Martin C-130s and Boeing KC-10s. The PC-12 program involves the installation of two or four 10-in. displays. IS&S has completed 35 of these retrofits and has 10 more on order. A used PC-12 costs about $2 million, but a cockpit retrofit is only $200,000.