Piaggio ramps up Avanti II production

 - September 26, 2006, 11:32 AM

As Piaggio Aero’s new Avanti II entered production last month, the company also announced it is increasing production to meet growing demand for the turboprop twin, but will it be enough?

Increasing production to match demand has been one of the company’s most difficult hurdles since it emerged from bankruptcy in 1998. That year, the company delivered four Avantis, and production was hardly a concern. Since then, demand has gradually outstripped the Italian OEM’s production capacity.

Last year the company delivered 12 aircraft, short of its stated goal of 20. This year, with the Avanti II in full production, Piaggio hopes to deliver 24. Some skeptics, however, question whether the company will be able to meet that goal and, even if it does, whether that will be enough to meet both short-term and long-term market demand.

Avantair, a fractional ownership operator now based in New Jersey but soon moving to Florida, already has 25 Avantis in service and expects to add 12 more by the end of this year. The company also placed a $230 million order in November for an additional 36 aircraft, calling for deliveries to begin in early 2008 and continue through 2010 at the rate of one a month. “And we’d like to get that schedule moved up,” said Avantair CEO Steven Santo, whose company manages another eight Avantis for individual owners.

“If Piaggio can deliver 24 airplanes in 2006, I’m fine,” he added. “If it can’t…” Santo did not elaborate, but it is typical for such contracts to include penalties for late deliveries.

Avantair is not the only fractional operator awaiting deliveries of the Avanti II. In Canada, Calgary-based Avia Aviation now has four of the aircraft in service and is expecting delivery of five more this year.

If Piaggio does achieve its goal of producing 24 Avanti IIs this year, and 20 are destined for the two fractional operators, that leaves just four slots available for individual customers.

While demand for the Avanti II is gratifying for Piaggio, not to mention profitable, increasing production is a decision to be considered carefully, and “not at the cost of quality,” Piero Ferrari, president of the Piaggio Aero board of directors, told AIN.

Production Capacity

Piaggio Aero CEO Jose Di Mase agrees, emphasizing that the company’s focus will remain on quality. “We are not market-share driven,” he said.

Nevertheless, the company appears intent on meeting its production goal of 24 aircraft this year and is taking steps to ensure further production increases. A new assembly plant in Albenga, near Genoa, is expected to go on line late next year or in early 2008, according to Piaggio America president Tom Appleton.

The new plant will allow Piaggio Aero to increase Avanti II production to as many as 36 aircraft a year.

The company is also taking steps to ensure that capacity farther down the line is commensurate with increased production, including interior completion work.

Piaggio has recently added two new service centers–Indianapolis Jet Center in Indianapolis and TG Aviation in Mt. Hope, Ontario, Canada. While those facilities replace the two authorized service centers that Piaggio dropped earlier this year, a Piaggio spokesman said the company has plans to add two more centers in the near future, which will bring the total to eight–one in Canada and seven in the U.S. The technical support staff has added a third field representative to cover the central U.S.

After assembly in Italy, green Avanti IIs are flown to the U.S. for cabin finish work. Until recently, Stevens Aviation in Greenville, S.C., was the only authorized completion center. That has changed. In November, Piaggio Aero identified two more Avanti II completion centers–Jet Works Aviation in Denton, Texas, and Jet Aviation in West Palm Beach, Fla., where Piaggio America has its sales, service and support headquarters.

A source at Piaggio said the company has not yet determined the criteria by which green Avanti IIs will be assigned to the three centers but that “customer preference would play a major role.”

Piaggio Aero further revealed that it has reached an outsourcing agreement with Aircraft Technical Publishers for maintenance information management. The exclusive agreement covers all technical libraries, distribution and customer service worldwide for the Avanti and the Avanti II.