Eurocopter is shoring up work at its Columbus, Miss., plant by opening an assembly line for the AS350 Ecureuil/Astar light helicopter.
Work on AS350 assembly will begin during the fourth quarter of 2014 in a bid to offset the impact of the U.S. Army’s decision to reduce the number of UH-72 Lakota light utility helicopters it plans to buy. The factory will initially build 50 AS350s, with plans to expand by 2016 by producing up to 60 additional helicopters annually by 2016, the company announced on Sept. 20.
The company says the factory will undertake the AS350 assembly process using parts produced by Eurocopter and its suppliers, as well as the continued production and retrofit of UH-72s for the U.S. Army and foreign military customers including Thailand, which was announced as a possible customer for six aircraft by the U.S. Defense Security Co-Operation Agency (DSCA) in June.
“North America is the largest light helicopter market in the world for Eurocopter, and this new assembly line supports our industrial strategy by manufacturing the preferred AS350 ‘Made in the USA’ in close proximity to our customers,” said Joseph Saporito, the company’s EVP for Global Supply Chain.
“This decision further supports our investments that have developed reliable and efficient local industrial capabilities in a market with strong expected growth.”
The Columbus factory was set up specifically to produce the UH-72 Lakota for the U.S. Army, and many of the plant’s workers are U.S. military veterans. The move undoubtedly will cause some consternation among Eurocopter’s French workers, who have seen production move out of France as part of customer offset deals in Brazil and Kazakhstan.
Eurocopter argues the strategy of being in “close proximity” to its customers has delivered it several successes in key markets.
The Army, which had a program of record to buy 346 UH-72 Lakotas from EADS North America (EADS NA) through 2016, cut the number of aircraft it planned to purchase in fiscal 2014 from 31 to 10. It also eliminated the purchase of a final 10 aircraft in fiscal 2015, resulting in a reduction of 31 aircraft, bringing an end to a critical U.S. Defense Department contract for the European defense manufacturer.
The selection of the UH-72, a militarized version of the Eurocopter EC145 in 2006, was hailed as a huge success for Eurocopter and EADS. The type won ahead of competitors from established U.S. suppliers to meet the Light Utility Helicopter program, replacing H-58 Kiowas and H-1 Hueys in National Guard units and other U.S. Army units. As well as performing the utility role, the Lakota is also used for the medevac mission, search and rescue, and security and border patrol, as well as training. The U.S. Navy also uses a handful of aircraft for its Test Pilots School.
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Surbhi Maheshwari [MBA Fin / Mktg ]
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