HAI Convention News

Tilton’s plans for MDHI start with a factory deal in Mexico

 - September 29, 2006, 6:45 AM

Since Lynn Tilton bought MD Helicopters last summer and installed herself as CEO, she has spoken about being on a mission. She says she wants her company to grow to become number one in terms of customer service, in addition to building the safest helicopters in the world. It is only over the past few months, she admits, that she has started to understand the enormity of the task.

“This journey is difficult,” she said yesterday. “It’s taking me to new places and I’m having to take difficult steps to help us achieve our goals. It’s a real test of the courage of my convictions, energy and strength of character.”

Tilton has already contracted manufacture of the fuselages of the single-engine range (500E, 530F, 520N and 600N) to an automotive firm in Mexico. Production will start in the spring and the first fuselage will be delivered before the end of the year. Another Patriarch property, Heritage Aviation, is a completion center with skills in avionics and VIP interiors and has been selected to play an influential role in the first step: bringing 500 model production in-house.

The Tilton plan is to have every component “on call” by 2008–a decision that she admits will mean higher sticker prices. The upside, she said, is that MDHI will be able to stick to its delivery promises to customers.

Bringing the supply chain as far as practicable under MDH control is the goal now. Tilton will start by selecting companies that trade as part of her Patriarch Partners investment firm. She said she is not afraid to buy more businesses and, to complete the matrix. She also wants to create partnerships–even joint ventures–with a few key suppliers who are willing to build large numbers of components for MDHI.

As for the safety claim, MDHI has put itself forward as the “poster child” for the new industry-wide safety drive. Tilton said that by the beginning of 2007, its products will incorporate four out of five safety features identified by the International Helicopter Safety Team–wire-strike protection, TAWS, HUMS and cockpit video recording–will be in place. supply chain issue, the manufacturer is taking no new orders for its products.

Meanwhile, Tilton joins all the other contenders in being “cautiously optimistic” about her company’s chances in the more pressing matter of the U.S. Army’s LUH competition; the decision is due at the end of April.

“We have told the Army that we can deliver on this and we will,” she said.“A win here would take us from being good to great more quickly, but our focus will remain on our commercial line.”