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Helicopter industry adapts to new reality

There was a one-word, unofficial theme to the American Helicopter Society annual meeting in Fort Worth last week.

Affordable.

It's the new reality facing the U.S. military and, by extension, the industry that designs and builds helicopters for it.

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With its overseas wars winding down, a flat defense budget and a strong likelihood of a big funding cut come Jan. 1, the Army -- and to a lesser extent the Marines -- are not going to be buying many new helicopters going forward. And the money they do have will be spent keeping the old ones flying a lot longer.

Army Maj. Gen. Tom Crosby, the executive officer overseeing the service's aviation programs, showed a chart depicting his $7.8 billion budget for fiscal 2012. That figure includes pretty much everything from new helicopters to screws and bolts.

"Anybody see that going up? Not me," Crosby said, referring to a defense budget that got trimmed this year and could get whacked by nearly another $50 billion in January.

The helicopter society is largely made up of industry and academic engineering gurus who dream up new and ostensibly better helicopters and technology to transport soldiers, civilians and supplies.

It's a group that looks to the future, to new technology developments and aircraft programs, plans that typically consume bundles of taxpayer dollars.

That money, Crosby and others warned, is probably not going to be available anytime soon.

The Army has its wants and needs, including a new light scout helicopter that the industry has been jockeying to compete for. Eurocopter and Lockheed Martin have joined forces to build prototypes for testing, as has Bell Helicopter. Sikorsky is planning to build two all-new prototypes with its X2 high-speed technology.

With lots of lobbying from the helicopter makers, the Army is planning to hold a demonstration to see what the companies can offer, but Crosby isn't optimistic that he can buy any of it.

"As much as I want and need a new armed scout," Crosby said, "it's unaffordable."

The Marines are in a little better shape than the Army, or at least they think they are. Marine officers touted their plans for future purchases of the Bell-Boeing V-22 Osprey and Bell's UH-1Y and AH-1Z helicopters.

But the Pentagon has already cut planned V-22 purchases from 2013 through 2017, and that's before the looming January cuts. And even the Marines and their Navy bosses emphasized that money is tight and industry needs to do a better job of providing spare parts and upgrades that last longer and cost less.

Troy Gaffey, president of AVX Aircraft of Fort Worth, sees the affordability push as a positive for his company's proposal to refit the Army's aging OH-58D scout helicopters with new rotor systems.

The Army will likely have money for continued upgrades and modifications, if not for new helicopters. The AVX plan would dramatically boost performance and improve safety at low cost, Gaffey said.

Similarly, Eurocopter Chief Executive Lutz Bertling touts the company's X3 helicopter technology now being tested as a lower-cost way to boost speed and productivity compared to the tilt-rotor technology used in the V-22.

The big target for the future is the Army's plan for a new generation of helicopters that it hopes to have money to fund later this decade. They would fly farther, faster and carry more.

But given the current trajectory of development and manufacturing costs and the Army's desired requirements, one industry executive warned that those aircraft would be -- wait -- unaffordable.

Does anybody really think, Sikorsky President Jeff Pino said, that the Army will be willing or able to pay $60 million to replace the Black Hawk helicopters it's now buying for $18 million?

As he has done for several years now, Pino urged his colleagues to invest more of their own money to develop the technology and aircraft for the future rather than waiting for the Pentagon to spend money.

Distributed by MCT Information Services

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