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Aviation History
2003
2003 - 1401.PDF
BUSINESS HELICOPTER MARKET ALEXANDER CAMPBELL / FILTON Eurocopter boss predicts 40% rise in military sales Bregier forecasts gloomy short-term outlook for civil orders, but says upturn is in sight Rising deliveries of military heli copters should push Eurocopter sales up 40% within the next three years, says chief executive Fabrice Bregier, although he sees little prospect of expanding civil sales. He expects the EADS division's annual sales to hit €3.5 billion ($4.1 billion) by 2005, up from €2.5 billion last year. Eurocopter's civil light helicopter range has secured a "massive market share" - over 80% penetration in the French, German and UK police sec tor, and 50-60% of the far larger US market, says Bregier. However, he does not foresee the company expanding sales in other countries. "I don't expect to increase market share in the civil market," he says. "The market will grow - not this year, but later by 3-4% a year." The picture looks better on the defence side; sales of military helicopters now make up 42% of Eurocopter's rev enue, but this will grow to over 50% 1 A Bregier: "Massive market share" "in two to three years", says Bregier. With orders for Tiger attack heli copters from France and Germany in hand, Bregier is optimistic about att racting business from Spain that would be filled at a new production line at EADS Casa. He forecasts a demand for 595 NH90 transports from the NATO nations, which are covered by memoranda of under standing. So far, only 305 firm orders have been placed. But the UK military is a less hope ful market, he concedes. Eurocopter has little chance of substituting its own aircraft for the ageing British Army Lynx fleet. That contract is likely to go to the Super Lynx up grade being developed by Agusta- Westland, he says. The contract is "not a priority for Eurocopter", says Bregier, but he adds: "Things are still open in SABR [support amphibious battlefield rotorcraft] competition." Bregier says the NH90 would be "an ideal complement to Chinook", but Eurocopter may be the second choice. The in-service AgustaWest- land EH101 is "clearly in pole posi tion for this one". Eurocopter plans to submit one of its light helicopters for the UK's 10-year, £150 million ($245 million) Northern Ireland requirement. APPOINTMENT Oneworld announces new boss Oneworld has picked John McCulloch to succeed Peter Buecking as managing part ner (chief executive). Bueck ing was last month named president of communications services provider Sita. McCulloch is Oneworld vice-president marketing and previously worked for Cathay Pacific Airways for 15 years. He was confirmed as succes sor at the alliance's recent governing board meeting in Washington DC. McCulloch will work from Oneworld's base in Vanc ouver, Canada, and will report to the chief executives of member airlines Aer Lingus, American Airlines, British Air ways, Cathay Pacific, Finnair, Iberia, LanChile and Qantas. Oneworld says it has con tributed more than $2 billion to its member airlines' bal ance sheets over the past three years, through revenue generation and cost savings. TAKEOVER MARIA WAGLAND / LONDON German investor takes DBA off BA's hands Nuremburg-based consultancy and investment company Intro Verwalt- ungsgesellschaft is to take control of British Airways' struggling German subsidiary DBA on 1 July. The sale follows Easyjet's deci sion not to exercise an option to buy DBA earlier this year after the German pilots' union Vereinigung Cockpit resisted efforts to impose the operator's business model on the German airline. Easyjet blamed the "rigidity of German labour laws" and DBA's poor financial per formance due to Lufthansa's "aggressive pricing policy". BA agreed to sell DBA to Intro for a nominal €1 ($1.18) after discus sions with potential buyers. BA has undertaken to invest £25 million ($29.4 million) in the airline during its first year of operation under new ownership, as well as underwrite its fleet of 16 aircraft for one year at a cost of £2 million a month. Intro says it is aims to increase productivity by 20% in the first year, and boost revenue by 10% "to bridge the weak holiday months". Once the airline reaches prof itability, Intro says it will sell DBA shares to third-party investors as RESULTS well as employees. Hans Rudolf Whohrl, who founded German charter carrier Nurnberger Flug- dienst, which was subsequently integrated into Eurowings, heads Intro. He was also a DBA board member from 1994 to 2001. "The aim is that DBA will not, in the future, be the cheapest airline, but will offer the best price for qual ity service," says Whohrl. DBA operates a fleet of 16 Boeing 737s on domestic and inter national services from Berlin, Cologne-Bonn, Diisseldorf, Ham burg, Munich and Stuttgart. Irish low-fare carrier's after-tax profits leap 59% Irish low-fare carrier Ryanair has reported a 59% jump in after-tax profits for the year ended 31 March as its busi ness continues to grow rapidly. After-tax profit totalled €239 million ($281 million), up from €150 million the previous year. Earlier this year, Ryanair fore cast a full-year net profit of €235 million. Revenue was up 35% to €843 million and the number of passengers carried rose by 42% to 15.74 million. Average load factor increased to 84% from 81 % and the carrier says this was "primarily due to a 6% reduction in average fares". While revenue increased 35%, operating costs were up 26%, helping boost after-tax margins to 28% from 24%. "These results demonstrate how robust Ryanair's low est-fares business model is in Europe," says the airline. "Ryanair has - for the 15th year in a row - delivered increased profits, despite a 6% reduction in average fares, at a time when most of our competitors are reducing capacity and announcing losses." However, the carrier warns its financial performance over the past year has been "exceptional", adding: 'We have repeatedly stated that profit margins of almost 30% are a one-off and non-sustainable." Ryanair's plan is to grow traffic on average by 25% a year and to maintain an after-tax profit margin of about 20%. www.flightinternational.com FLIGHT INTERNATIONAL 10-16 JUNE 2003 35
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