Europe Sizes Up: European business aircraft manufacturers

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MURDO MORRISON / TUSSENHAUSEN-MATTSIES & GENOA
Additional reporting by KATE SARSFIELD and GRAHAM WARWICK

There is a new-found confidence among the continent’s business aircraft manufacturers with several innovative designs arriving on the market

Finding Grob Aerospace’s factory near the Bavarian village of Tussenhausen-Mattsies is not easy. A small sign directs visitors behind a barn and down a tree-lined lane to where the company – which made its name selling glassfibre and carbonfibre gliders and small aerobatic trainers in the 1970s and 1980s – is busy pursuing its ambition to become the latest European general aviation manufacturer with a stake in the booming business aviation market.

Grob’s relative obscurity – it has sold only a handful of aircraft a year since military sales collapsed at the end of the Cold War – allowed it to quietly build the SPn, an all-composite eight-seat utility twinjet, without the world finding out, before unveiling it at last year’s Paris air show. Not even suppliers were fully aware of its plans, says vice-president of sales and marketing Hans Doll, who remarks: “There’s only cows around here, and they don’t talk.”

The company has struck a deal with Swiss aviation services company ExecuJet to exclusively market the aircraft, which is 10 months into flight testing, with Grob aiming for European and US certification in the second quarter of next year.

 piaggio p180 w445
Launched in the late 1980's, Piaggio's P180 Avanti's fortunes took off under the ownership of a consortium lead by the Ferrari family                     © Piaggio
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 Diamond's single engined D-Jet is set to make its debut at the Oshkosh show in July                                                                                 © Diamond

A subsidiary of a private German automotive machinery producer, Grob is one of several European manufacturers either moving up the value chain from GA to business aviation or boosting their business aircraft product line in anticipation of a burgeoning market for air taxis and charters in Europe and the USA, as well as the emergence of a new customer base in Asia and the Middle East.

Italy’s Piaggio launched its innovative P180 Avanti twin-pusher in the late 1980s, but only in recent years has the company – rescued from bankruptcy in 1998 by a consortium led by the head of the Ferrari family – begun to convince the world, and particularly North American buyers, of the aircraft’s merits. With the updated Avanti II – with Rockwell Collins Pro Line 21 integrated flightdeck – having just received US certification, the company has delivered 103 aircraft so far and has orders for another 100, 70% of them from the USA.

The company – which promotes the Avanti as the fastest turboprop on the market – makes the most of its connections with the famous performance car maker. Ferrari’s Formula One racing team and its star driver Michael Schumacher use the aircraft. Now Piaggio is preparing to decide on its next aircraft – one of two jet concepts: one similar in size to the six- to eight-seat Avanti; the other slightly bigger. Board director Alberto Galassi says that, although the new aircraft will be less radical-looking than the P180, it will be “designed with the same passion” as Ferrari cars. “The one thing you can be sure of is that it will be beautiful,” he says.

Bestseller

Utility, rather than beauty, has made Swiss manufacturer Pilatus’s single-engined PC-12 the best-selling turboprop model for the past three years. With a backlog of 145 orders, production is sold out until the end of 2007. “We plan to produce 90 aircraft this year and next, and will not ramp up production until the time is right,” says sales and marketing manager Fred Muggli. With the standard aircraft proving popular, Pilatus has no plans for upgrades in the short to medium term, but it is expanding its support network, with plans for service centres in Singapore and Thailand. “We hope to receive certification China by the end of the year,” says Muggli, with a service centre to be established there in 2007 ahead of delivery of the first aircraft in 2008.

EADS Socata is exploiting its parent company’s links with China as it sets out to challenge Pilatus’ leadership of the single-engine turboprop market with the uprated, and newly certificated, TBM850. Although the French company has its roots in producing piston-powered light aircraft, that market has dried up. Socata delivered 31 turboprops last year, but only nine piston singles, and it plans to produce 42 TBMs this year, 85% of which are already sold. “Our goal is to produce between 50 and 70 aircraft a year from 2008,” says Marc Le Stunff, vice-president of sales for Europe, Asia and Africa. “Socata has a 35% share of the six-seat turboprop market. We want to increase this and aim to be one of the top two turboprop manufacturers in this class.”

Another name well known in the piston world, aerobatic aircraft manufacturer Extra, is getting ready to move into the turboprop market. The German company, now US-owned, says it is finalising financing to launch production of the six-seat, single-turbine EA-500 in June. First flown in 2002, the high-wing, all-composite aircraft was certificated in 2004. Now the company says it hopes to agree financing within weeks, enabling it to deliver the first aircraft by year-end. Extra is planning to build 40 EA-500s next year at its Dinslaken airport plant near Düsseldorf and forecasts a strong market for the $1.35 million aircraft, which is substantially cheaper than the competing PC-12 and TBM500.

VLJ threat

European manufacturers are taking an increasing share of the business turboprop market just as the first very light jets (VLJ) begin to compete for the same owner/flyer market. The uprated TBM850 is Socata’s direct response to the VLJ threat, but the PC-12 is in a different size, and price, class. “Demand is very strong and we don’t see the VLJs posing much of a threat to our business,” says Pilatus’ Muggli.

Austria’s Diamond Aircraft, which has quickly become one of the world’s major GA manufacturers with its modern line-up of piston singles and twins featuring composite airframes, integrated avionics and diesel engines, is the first European player to jump into the VLJ market. At around $1 million, its single-engined D-Jet is aimed at the “personal jet” end of the market. Last year, the programme was relocated to Diamond’s Canadian subsidiary because North America is expected to be the major market for VLJs. The D-Jet made its first flight from the London, Ontario plant on 19 April and is to debut at the Oshkosh show in July.

Back at Tussenhausen-Mattsies, Grob’s second SPn is slowly taking shape. With the prototype more than 150h into its flight-test programme, the carbonfibre fuselage and one-piece wing of aircraft number two are being worked on by a handful of engineers, all experts in composite structures, ahead of its appearance, complete with VIP interior, at the European Business Aviation Convention and Exhibition in Geneva. With no welding, drilling or other machine tooling, the soft rock music emanating from the radio in the corner is the loudest noise to be heard on the shopfloor.

Grob’s entire business has been quiet for several years and would have likely withered away had it not been propped up by its parent, based in nearby Mindelheim. Founded in the early 1970s by Grob’s aviation-obsessed owner, the business delivered 1,500 gliders and 500 motor gliders in its first two decades, with production peaking at eight aircraft a week. But with the market saturated and air forces downsizing after 1991, orders have been harder to come by. “Everything stopped in 1992,” says chief operating officer Dr Andreas Strohmeyer. Since then, the company and its 140 staff have concentrated on building the G-115 and G-120 high-performance trainer and aerobatic aircraft, of which about 100 have been delivered, as well as maintaining and upgrading existing models.

Expansion ahead

That is set to change as the company gears up for production of the $7 million SPn, with output planned to reach 40 a year in 2009 and ExecuJet predicting a market for more than 400 aircraft over 10 years. The company is looking to take on up to 200 more staff, a task Strohmeyer expects will be easy following the collapse of the Fairchild Dornier regional aircraft business in nearby Oberpfaffenhofen, which left 4,000 skilled workers without jobs. Holding his palms 10cm apart, Strohmeyer says he gets “this many” unsolicited CVs every week from people wanting to work for Grob. This is because, despite its size, the company has a reputation as an industry leader in composite technology, he says.

The SPn is the biggest all-carbonfibre jet in the world and 10% lighter than an equivalent all-metal aircraft, Strohmeyer says, and “could be more if you were to compromise on the robustness”. Grob and ExecuJet expect the aircraft’s price, range, short-field performance and versatility will appeal to a wide range of customers from medevac and cargo to air taxis and value-seeking corporate users. Grob claims the SPn has a range of 3,335km (1,800nm) with six passengers. A modular “plug and play” interior concept allows the cabin to be converted from a double-club configuration to four seats and a cargo area. An 84 x 132cm (33 x 52in) door is big enough to take a standard Europallet. “When we launched the SPn, we called it the Utility Jet,” says ExecuJet marketing director Peter Smales. “We’ve now dropped that name because we want it to be seen as a business aircraft, but it in no way takes away from the basic message that this is an aircraft that can operate in a range of markets.”

Like Grob, Piaggio is a company that enjoyed a glory era – in its case as a government-supported builder of military and utility aircraft for the Italian armed and parapublic services before and in the decades following the Second World War. But the Genoa-based manufacturer had a much more spectacular fall from grace. The development cost and slow acceptance of the Avanti, coupled with plummeting defence budgets in Italy and beyond, sent Piaggio into bankruptcy in the mid-1990s.

Today, after being bailed out by chairman Peiro Ferrari and chief executive Jose Di Mase, the company has 1,340 employees and turned over $205 million last year. As well as its Avanti line, Piaggo has aerostructures, engines and maintenance, repair and overhaul businesses, and operations in Naples, Nice and Finale Ligure, as well as Genoa. The company has moved its US operation in with Jet Aviation at Palm Beach airport in Florida and will replace its ageing Finale Ligure components manufacturing plant with new premises in nearby Albenga in 2008.

Healthy backlog

For the first time since the P180 arrived on the market in 1990, Piaggio has a healthy production backlog, with only a few slots available before 2010, and demand is pushing up aftermarket values, with a 2003 aircraft with 1,000h valued today at about $5.9 million, compared with $6.2 million for a new aircraft, says Massimo Isidori, vice-president of sales for Europe and the Middle East.

“Sales prospects are good in the Middle East, Brazil and India, China and Australia,” Isidori says, but it is the North American market that has really taken off for Piaggio, with one customer in particular crucial to its success. New Jersey-based all-P180 fractional-ownership operator Avantair operates 27 aircraft, and will take delivery of another two a month through to the end of 2008 under its current order.

Piaggio says an announcement on the new jet – and a risk-sharing partner in the programme – could come as early as October’s National Business Aviation Association convention in Orlando. After its experience launching the Avanti on to an unsuspecting market in the 1990s – the twin pusher turboprops and canard foreplane earned it the nickname “the catfish” – Galassi says the company will not take any gambles with a design too ahead of its time. But it will be “different”, Isidori says. “In Italy, we are not famous for making planes. We are famous for our style.”