AlliedSignal Bullish on Helicopter Sales

The 1999-2003 period will see sales of some 2,350 new turbine-powered civil helicopters, sustaining a growth rate of three percent per year, AlliedSignal Aerospace predicts in its second annual Helicopter Market Outlook.

The AlliedSignal survey indicates a 10% increase in business over the 1994-1998 period, when 2,100 new turbine helicopters were delivered.

"The emergence of new, higher-value helicopter models, with more cabin space and increased performance and comfort, continues to stimulate customer demand," the company said. Light singles will remain the most popular type.

"Continued economic growth in most regions, especially Western Europe, fleet age and the recent introduction of important new and derivative helicopter models continue to be the important factors supporting current market strength," said AlliedSignal Engines helicopter programs director Chris Hickey.

"We are encouraged about the current and future business prospects for helicopters in this diverse global economy," Hickey said.

Strong levels of replacement demand and fleet expansions will both contribute to the prosperity. AlliedSignal polled representatives of nearly 1,000 helicopter operators worldwide, and found "near-term strength and stability" in the new turbine helicopter market to be driven by new model availability, general favorable economic conditions in the U.S. and Europe, and "evolving regulatory requirements, primarily in Europe."

For AlliedSignal, growth in helicopters means continuing business in the products including engines, APUs, avionics and integrated aircraft systems.

Among the AlliedSignal survey's findings:

• New and derivative models will account for nearly 42% of purchases over the coming half decade.

• North America continues to be the largest market, as it will account for 54% of sales over the next five years. Twelve percent of existing fleets will be replaced while fleets are grown by four percent. AlliedSignal found, however, "a more cautious attitude toward sustained economic growth based on the turmoil experienced over the last year in other regions."

• Europeans expect to expand existing helicopter fleets by more than seven percent as they replace better than nine percent of their existing fleets. New or derivative models will account for an estimated 56% of sales.

• Latin America will account for about 12% of the market with most of the business coming as operators upgrade; 19% of Latin American fleets will be replaced even though operations will be expanded by just two percent.

• "Operators continue to express a strong preference for light single-engine helicopters in their purchase expectations, naming this class aircraft 48% of the time," AlliedSignal said.

By Rich Piellisch