Farnborough Show News - July 14, 2008 - (Page 62)

FA R N B O R O U G H 2 0 0 8 ON THE RECORD— Dick Millman, President & CEO, Bell Helicopter Bell Sees Fewer Model as Profit Key Doubling production over the next five years, reducing customers’ waiting time for aircraft they have ordered, and boosting profitability and return on investment are three of the major challenges facing Dick Millman, president & CEO of Bell Helicopter. Driving the transformation is a leaning out of the workplace, including streamlining the product line to just four commercial helicopters: the single-engined 407, the ‘widebody’ twin-engined 429, the 412EP medium twin, and the 206L4 LongRanger. “When your factories focus on relatively fewer products they get much more efficient, which means that profitability will come back up to standard,” Millman said. Bell is giving equal emphasis to commercial and military markets. While the commercial order books are bulging and the company delivered 181 commercial helicopters last year (up from 159 in ’06), U.S. Government orders are far more in dollars for far fewer helicopters (last year it delivered 17 V-22s and the first 10 of up to 280 H-1 helicopters). The military backlog at the end of ’07 was $2.8 billion, double that of the commercial market. Military production is set to take off following the five-year multiyear contract awarded in March for 167 V-22s, and Bell expects it will soon start low rate initial production for 250 ARH armed reconnaissance helicopters, with an eventual requirement for 512 rotorcraft. Meanwhile orders for the commercial, large cabin Bell 429 exceed 330, which Millman says “is a large number for a helicopter that’s not yet certified.” FAA certification is expected later this year. The 429 is making its Farnborough debut here this week. These challenges are taking “very large” investments by Bell’s parent, Textron, and Millman is The Bell 429 twin. 18 months ago] but they’re in with both feet now,” he said. They’re also in deeper with their supply chain to ensure it can support Bell’s doubling of production. “We’re working closely with suppliers to —Dick Millman, President & CEO, Bell Helicopter help them ramp up their own production, and charged with making sure they gen- a capitalistic society where invest- we’ve got lots of people helping erate a commensurate return. “The ment tends to flow where there is them do that. “In fact we’re making some companies I used to run probably a promise of successful return to had one of the highest profit rates the shareholders,” said Millman, investments” at more than one in the industry (he was previously “and I have a decent track record supplier. “It’s not something that I have done very often, but as conpresident of Textron Systems) in that regard. “Bell was not as much in the ditions warrant and to make sure and there’s no reason why Bell shouldn’t be successful from the game as I thought they were and we get appropriate attention,” profitability prospective. We are in could have been [when he took over Millman said. —John Morris “Bell was not as much in the game as I thought they were and could have been [when he took over 18 months ago] but they’re in with both feet now,” ‘Demand Can Drive Investment,’ Bell Says of V-22 Bell Helicopter is prepared to ramp up production of the V-22 Osprey tiltrotor to meet increasing demand from domestic and export markets, says Bell’s president & CEO Dick Millman. “We’re prepared to make the investments to do that,” he told Show News. But that demand must be strong enough to warrant the considerable sums it will take to increase the production rate beyond the 36 or so a year called for under a $10.4 billion, fiveyear multi-year procurement contract awarded by the U.S. Department of Defense in March. Under that contract Bell and Boeing will supply 26 CV-22 aircraft for the Air Force Special Operations Command and 141 MV-22 aircraft for the U.S. Marine Corps. Production will double to just over three a month, and could rise further if options for more aircraft are exercised. Millman said a further increment of investment in machines, tooling and labor could take production capacity as high as 47 or so aircraft a year. “If you want me to add one or two aircraft that may be a difficult proposition, but if you want me to add four or five a year, that is something I could oblige. Demand can drive investment.” Interest in the V-22 has increased since its first—and successful—deployment to Iraq with the Marines, and will likely grow further when the Air Force starts flying it in the near future. Other countries have expressed interest too, with Australia, Israel and the UK reportedly among them. “When a country’s government comes to us and asks for price and availability I have to answer very carefully,” said Millman. “The lead time for parts is 36, 40, 44 months depending on the parts, so if you tell me you want extra aircraft you had better give me some time.” —John Morris 62 July 14, 2008 www.aviationweek.com/shownews http://www.aviationweek.com/shownews

Table of Contents Feed for the Digital Edition of Farnborough Show News - July 14, 2008

Farnborough Show News - July 14, 2008 Contents Thirty More Years CFM Reveals New Engine Boeing Reduces Forecast UAVs’ Quiet Revolution Finmeccanica: U.S. Success A Plethora of AESAs BAE North America Plus L-3 Becomes a Prime Better Late Than Never A Peek Behind the Curtain China’s J-10 Revealed Boeing’s 787 Dreamliner Breaking LM’s Hegemony

Farnborough Show News - July 14, 2008

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