Argentinian, Brazilian and Chilean companies lead in putting South America's aerospace industry on the map

Paul Lewis/SANTIAGO Guy Norris/CORDOBA

The South American aerospace industry has won recognition in recent years as a major player on the international scene, thanks in part to the success of Brazilian manufacturer Embraer. Two other companies emerging from relative obscurity to make their mark are Empresa Nacional de Aeronautica de Chile (Enaer) and Lockheed Martin Aircraft Argentina (LMAAS).

Enaer was established 16 years ago by the Chilean air force to help beat international arms sanctions. It has since evolved into a rounded international business, with interests not only in the military market, but extending to the design and development of general aviation products, aerostructures manufacturing, and maintenance and overhaul.

Brig Gen Alfredo Guzman, Enaer's new executive director, says: "Over the past two decades, Chile has emerged in a strong position and we're able to offer our knowhow to other South American countries that want to collaborate with us. We have major competitive advantages, low labour costs and high-quality work."

This stood Enaer in good stead during the region's recent economic downturn. While profits were hit, falling from $2.2 million net in 1998 to $1.2 million last year, sales have continued to grow, ballooning from $46.6 million to $60 million last year. This is in no small part because of the company's growing partner-supplier relationship with Embraer.

Enaer is the sole supplier of the empennage for the Embraer RJ-145/135 family of regional jets. Orders and options total about 1,000. Production has accelerated from six to 12 aircraft a month and is set to rise to 16 by next year. "Even right in the middle of this crisis, we continued to hire people as the number of shipsets required by Embraer doubled," says Guzman.

The company is keen to build its relationship with Embraer, to include participation in its larger ERJ-170/190 regional jet development. The company offered to supply the new 70-108-seat aircraft's empennage, but appears to have lost to Gamesa of Spain and seeks to participate in other areas.

Enaer's other principal manufacturing work revolves around revitalising its A-35 Pillan piston trainer and finally putting the locally designed Namcu/Eaglet light aircraft into series production. A total of 126 Pillans has been built since 1981 for seven nations, including Chile, Guatemala, Panama and Spain. Work stopped 12 months ago after delivery of the final four of eight ordered by the Dominican Republic.

"I see good opportunities in South America and Europe and we may be able to manufacture another 100. At the FIDAE air show [from 27 March-2 April, in Santiago], I'll be talking to some Central American countries that have an interest in buying more Pillans. I have four in production, and my business plan for the year calls for 12," says Guzman.


Enaer is still promoting the improved T-35DT Turbo Pillan, powered by a 310kW (420hp) Rolls-Royce 250 turboprop in place of the Textron Lycoming IO-540 six-cylinder piston engine. It has been flying for years without attracting a launch order. Enaer is nonetheless confident that the 180kt (330km/h) speed and price of under $1 million will attract smaller nations looking to acquire a patrol and observation capability. Enaer claims that at least two countries are interested.

The company hopes to receive European certification of the side-by-side two-seat Eaglet by May, after more than a year of delay. The composite aircraft was developed as the Namcu basic trainer for the air force, but after the military lost interest, it was relaunched in 1995 as a joint venture with the University of Delft in the Netherlands.

Renamed the Eaglet, the aircraft has undergone design changes to comply with certification requirements, including installation of a more powerful Lycoming O-320-D2A piston engine. A modified Namcu has been flying with Euro-Enaer in the Netherlands since 1998 and it will be joined by the first fully compliant prototype at the end of March.

As part of its joint venture responsibilities, Enaer delivered the prototype to the Netherlands in February for engine and avionics installation. "We'll manufacture the airframe here and they will complete it over there and sell it in Europe. The Dutch are confident, and think there is a big market for this small lightweight aircraft," says Guzman.

Euro-Enaer appears to have dropped immediate plans to seek certification for the aircraft. Attention is focused on selling the $160,000 Eaglet to private flying clubs in Europe and to government agencies in South America.

Civil diversification

Enaer, in the meantime, has diversified into other civil programmes, such as supplying Dassault Falcon 900 and 2000 lower mid-wing structures, CASA/IPTN CN235 tail components and as a subcontractor to Israel Aircraft Industries (IAI). It hopes that the air force's forthcoming fighter buy will generate further spin-off work.

"For sure, there will be some economic compensation from the air force 2000 fighter programme. We hope for at least $20-25 million in additional sales per year by manufacturing parts and through aircraft and engine maintenance," says Guzman.

Dassault is pitching strongly to sell Chile the Mirage 2000-5MkII and has proposed making Enaer a support centre for other Mirage III/5/F1 fighters in the region. About 120 are in service with Argentina, Brazil, Colombia, Ecuador, Peru and Venezuela, excluding Israeli-built Kfir/Nesher/Dagger variants. Enaer's associate avionics repair company, DTS, is also likely to benefit.

Depot-level maintenance for the air force has provided Enaer with a staple diet of work since it was established at the El Bosque air base. The company supports virtually every type in the air force's inventory, ranging from Boeing 707s and Lockheed Martin C-130B/H tankers and transports, Mirage 5/50 and Northrop F-5E/Ffighters, down to piston Cessna O-2s.

Enaer, assisted by IAI, will next year complete a major avionics and structural upgrade of the air force's 15 Mirage 50s with the delivery of the last pair of single-seat and tandem-seat aircraft. The improvements are similar to those made to the F-5E/F Tiger III, the centrepiece of which was the installation of the new Elta EL/M-2032 multimode radar. The Pantera's upgrade heritage is clear, strongly resembling the IAI Kfir and South African Denel Cheetah upgrades. There are differences and "for our purposes, it is better", claims Guzman.

Work includes the installation of a new Elta EL/M-2001 radar, electronic warfare equipment, new head-up (HUD)/head-down displays, improved weapon delivery systems and inflight refuelling probe. The aircraft are being fitted with canards, two additional weapon hardpoints and stronger landing gear to handle the Pantera's increased take-off weight.

Enaer completed licence production of 41 CASA C101 Aviojets three years ago, but continues to support the programme. Two versions are in air force service, the T-36 trainer and A-36CC Halcon light strike aircraft. The recently completed "Toqui" programme upgraded the latter version with a new weapon delivery system.

The company's powerplant workshops also support an ageing, but impressive, array of engines for the Chilean and other air forces. This includes the F-5's and Cessna A-37's General Electric J85-17/21 and the Mirage's Snecma Atar 9K50, as well as Honeywell TFE731 jet engines and Pratt & Whitney Canada PT6 and Honeywell T53 turboprops.

Enaer expanded into the civil after-sales market in 1998 by creating a commercial aircraft division. It is performs heavy C- and D-checks on Boeing 737-200s for airlines such as Aerolineas Argentinas, Ladeco and LanChile, while the engine division hopes to break into the large Pratt & Whitney JT8D overhaul market.

In the wake of LanChile's large orders for new Airbus Industrie A320 and A340-300 passenger aircraft, Enaer is looking at more new overhaul and maintenance opportunities at Santiago's main Arturo Merino Benitez Airport. "We're talking about co-operation with LanChile and establishing a major new hangar at the airport for servicing large civil and military aircraft," Guzman reveals.

Deep in the fertile farmlands and rich grasslands of Argentina's pampas, meanwhile, the LMAAS Cordoba factory seems an unlikely place for a veritable aerospace revolution. Yet, filled to the brim with testing and manufacturing equipment of which most companies can only dream, this is the intended centrepiece of LMAAS' bid to become the premier aerospace provider in Latin America.

Argentinian jewel

"This facility is really the crown jewel in the whole Argentinian aviation/military complex," says LMAAS president James Taylor, who has been at the helm of the company's Latin American venture since the former government complex was privatised in July 1995. Although LMAAS was formed around the company's hard-won McDonnell Douglas A-4AR upgrade contract for the Argentinian air force, the victory provided it with something even more worthwhile in the long term - a springboard from which to hit new markets with new products and services in Latin America and elsewhere.

Lockheed Martin's bid for the A-4 work dovetailed with strategic plans to expand its global network of sites to include a Latin American stronghold. Taylor adds: "Part of the vision was to build an aviation centre of excellence down here in South America. We already had pretty good experience in China and Saudi Arabia and this was the next logical step in terms of the maintenance and overhaul business. By getting this site, we also got a couple of extra benefits, including a vast manufacturing site and engine overhaul facility."

The Cordoba site encompasses a bewildering range of capabilities under its 220,000m² (2.3 million ft²) roof. Massive, 18m (60ft) numerically controlled three- and five-axis machines, automatic lathes and milling and welding machines sit alongside autoclaves, clean rooms and ultrasonic inspection systems. In adjoining parts of the 200Ha (495 acre) site, supersonic and transonic windtunnels can be found beside ejection seat and parachute packaging lines. Sited close to nearby air force academies and training schools, LMAAS also has access to one of the most vital resources of all: more than 1,000 trained staff.

"They are probably one of the best trained labour forces I have come across anywhere in the world," says Taylor, who adds that the all-embracing Cordoba site is no accident. Fearing technical isolation through embargos from the USA and other Western nations in the wake of a military coup, it was forced to develop its in own in-house expertise.

Having completed the initial A-4AR upgrade work, as well as other Argentinian air force modification and maintenance contracts, LMAAS is preparing to attack the global marketplace with three main lines of business: civil and military maintenance and upgrades, manufacturing and engine repair and overhaul. All three initiatives build on the solid base of existing, or recently completed, work for the Argentinian defence department - particularly in the military aircraft maintenance and modification arena. Now the funding that supported so much activity is diminishing, and the hunt is on for new work.

LMAAS quickly discovered that it takes more than an impressive line-up of equipment and staff to secure new business in the hotly contested global market. "It was very obvious when we went looking for manufacturing work in Germany that we had to have ISO9001, for example," says Taylor, referring to the international quality assurance standard. The company underwent an audit by Germany's TUV and was awarded the qualification last August. To support its long-term commercial maintenance and modification ambitions, LMAAS also undertook a similar initiative to obtain Argentinian civil repair station certification for 737 and other work.

"We've laid out big plans for the 737 here," says Taylor, who believes the first aircraft could arrive at the site's dedicated 1,725m-long runway by late April. The company is in talks with domestic and international carriers about supporting in Cordoba many of the 737s that are sent for maintenance to Brazil and El Salvador. The 737 fleet is the fastest-growing in Argentina, with Aerolineas Argentinas taking ex-British Airways -200s, through its absorption of Austral, and LAPA to double its 737-700 fleet over the next two years.

Taylor believes local labour costs will allow LMAAS' 737 work to be competitively priced, but warns that value will remain the top priority, regardless of cost. "We can't, and won't, compete with rinky-dink 'mom and pop' operations with moonlighting military people and no technical manuals between them. We have started dialogues with airlines in all parts of Latin America and we are doing everything we can to make sure it will go through clean," he adds.

While it prepares for the 737, LMAAS is not neglecting its military role, and continues to support the Argentinian air force's Fokker F27s, C-130s and Beech T-34 trainers, as well as the FMA IA58 Pucaras and IA63 Pampas, built at the Cordoba site. It hopes to begin upgrading the C-130s this year - mostly standardising the cockpits and electrical systems of the force's various C-130 models to a new "H" configuration. The advanced flightdeck will be based on new flat panel displays and an avionics suite including global positioning system (GPS), traffic collision avoidance system, ground proximity warning and an emergency locator transmitter.

Advanced cockpit upgrades

Advanced cockpit upgrades are also proposed for the Pucara and Pampa. LMAAS' bid for the Pucara is based around a new horizontal situation indicator (HSI), attitude direction indicator (ADI), radio magnetic indicator, new navigation/communications radios, GPS and radar altimeter. A range of options has been proposed for the Pampa, much of which could depend on funding for a related bid to restart production of the advanced jet trainer and light attack aircraft. Options cover upgrading the 10 aircraft in service, plus baseline specifications for up to 12 new aircraft already budgeted, and a further 24 that may be sanctioned this year.

The new cockpit is also being proposed for the Pampas offered for advanced trainer competitions in Greece and Israel. The basic option is an ADI retrofit, plus a new HSI and HUD. A more advanced option covers HUD installation, plus multifunction display, hands-on-throttle-and-stick, mission computers, stores management system, inertial navigation and GPS. Both options include new radio suites and air data computers. Other upgrade elements include installing the more powerful Honeywell TFE731-4 or -5 turbofan in place of the -2, and a higher-capacity main landing gear to absorb the greater loads of the heavier aircraft.

Upgrades of the elderly T-34s, some of which are based on the work recently completed on 30 air force aircraft, are also being offered to other nations. Manufacturing general manager Alberto Buthet says: "We are putting together proposals for upgrades to fleets in Ecuador, Peru and Uruguay. Some want just cockpit work done, but others want more, such as engine and structural updates, so we are working on a number of packages."

Exhaustive work

Overhaul and modification work on the air force T-34 fleet included an exhaustive damage tolerance and life extension test that was so complete that LMAAS is offering it to the air force as a model for returning grounded aircraft to service. T-34s, used in relatively large numbers in the USA for aerobatics and simulated combat flying, were grounded throughout the Americas following a fatal crash caused by a main wingspar failure.

LMAAS' manufacturing ambitions are intimately linked to restarting Pampa production, but also extend to new work such as production of cargo-door kits for the parent company's L-1011-40 freighter conversion programme in Greenville, South Carolina.

This could become more significant for Cordoba if, as planned, the freighter line moves south from the USA following the sixth aircraft's completion. LMAAS is also talking to DaimlerChrysler Aerospace (Dasa) Airbus about setting up a Latin American A300/A310 cargo conversion line.

Another vital area of growth is the company's engine overhaul, repair and test initiative. Building on its extensive site, LMAAS plans to expand quickly this year to include the JT8D for the 737-200, as well as the closely related J52 engine used in the A-4AR. Operations general manager Howard Atwood says: "Once we establish a regional presence with the JT8D, the next step will be to offer the same work on the CFM56." The company is upgrading test cells to take the more powerful GE/Snecma powerplant, and hopes to begin its first CFM56 overhaul in 2001.

Staple engine work for the plant, in the meantime, continues to be on engines for the Argentinian air force fleet. This includes the R-R Allison T56, Honeywell TFE731 and 85-71/72 and 85-90 auxiliary power units, as well as the Turboméca Astazou XVIG and Snecma ATAR 09C engines. As with the airframe and avionics, the wealth of equipment at the Cordoba site means that elaborate component repairs and overhauls are possible.

With such dramatic expansion plans in place, it seems LMAAS' dream to put Cordoba on the world's aerospace map is well on the way to becoming reality.

Source: Flight International