Groen Bros. refocuses on government contract bids

 - October 8, 2007, 6:05 AM

In a major marketing change spurred by the fallout from September 11, Salt Lake City, Utah-based Groen Brothers Aviation (GBA) recently announced it would slow the already lagging FAA certification program on its four-place Hawk 4 gyrocopter, and concentrate on selling the aircraft to government agencies as a noncertified public-use aircraft.

“With the events of September 11, we believe we have the absolute best aircraft for surveillance of our borders and assets, and have offered the Hawk 4 to various agencies under the new federal Office of Homeland Security,” said Al Waddill, GBA sales director.

GBA personnel envision a fleet of Hawk 4s patrolling the U.S.’s “190,000 miles of pipelines, almost 600,000 bridges, 104 nuclear powerplants, nearly 20,000 miles of border and 463 skyscrapers.” The company cites myriad reasons why the Hawk is best suited for this role, including its STOL capability, low cost, consistent reliability and low direct and total lifecycle operating costs. GBA claims that under government contract, it could produce 10 aircraft in six months, escalating to 400 aircraft per year by June 2003.

Waddill said that government agencies are not required to use FAA-certified aircraft, although traditionally there has been a reluctance not to do so. He and other GBA representatives are actively courting the FBI, Department of Energy, U.S. Customs and the Border Patrol, and Waddill claims that there has been some interest displayed by at least one of these agencies. He did say that because of the September attacks, government agencies might be willing to accept the noncertified public-use status of the aircraft.

“We’re not giving up on FAA certification,” said Waddill. “We’re simply moving quickly to take advantage of an opportunity.”

GBA is also continuing its efforts to market its aircraft to U.S. and foreign militaries, although Waddill says that the current homeland security marketing strategy is separate from any attempt to sell to the military.

Although GBA is proudly trumpeting this attempt to sell its Hawk 4 as a public-use aircraft for homeland security, even going so far as to say in an October 16 press release that “no other aircraft in existence can perform this mission as well as the Hawk Gyroplane, at this price,” industry insiders characterize the move as “delusional.”

“To think that you can take what’s really a busted commercial venture and give it to the military or the government is naive and insulting,” said an aviation consultant who has worked on FAA, military and government certifications. He said that the larger government agencies such as the Forest Service and Border Patrol have their own certification bodies with their own requirements, and that trying to sell an unproven, uncertified aircraft to any of these agencies will be difficult at best.
“They have no track record to speak of,” said a former GBA employee who wished to remain anonymous. He questioned GBA’s claims about reliability and low direct operating cost. “How can they tout reliability when their one flying prototype has only a couple of hundred hours over its five years of existence?” asked the former employee, who also asserted that the company’s claims of $158 per hour direct operating costs are based on shaky estimates.

“They haven’t completed FAA testing to determine the life of many of their components,” he said, “and they don’t know the cost because they haven’t decided how large production runs will be.” The source noted that for a surveillance mission, a Robinson R44, costing less than half the Hawk’s $750,000 price tag and with proven direct operating costs of $121.35 per hour, would be stiff competition, especially since the Hawk is incapable of hovering.

Industry sources told AIN that it’s possible that GBA’s venture capital has dried up, and trying to sell the Hawk 4 as a public-use aircraft could be the company’s last-ditch effort at staying afloat. Company stock, traded on the OTC board, is at an all-time low, and according to Hank Parry, GBA marketing representative, the company is closing its Salt Lake City operations and moving engineering design, development and production to a new plant to be built at the Glendale, Ariz. airport, while simultaneously reducing its payroll by two-thirds.

The move has also left GBA’s network of 15 dealers dazed. “We have to reevaluate our strategy, too,” said Karl Hofmann, a GBA dealer in Denver. “The push-off of the FAA certification may hinder marketing, but we have seen strong interest with law-enforcement agencies, even without FAA certification.” However, no one has sold one yet.