Demand For Helicopters Rising In Latin America
There isn’t one manufacturer that doesn’t quietly salivate at the mention of the Latin American appetite for helicopters and the growth of that market. According to Honeywell’s 15th Turbine-Powered Civil Helicopter Purchase Outlook, the appetite for helicopters in Latin America suggests a 34-percent sales spike over the next half-decade. With sales during the next five years expected to reach “anywhere from 4,900 to 5,600 civilian-use helicopters worldwide,” such a forecast is certainly catching the attention of helicopter manufacturers.
In a recent interview, Helicopter Association International (HAI) president Matt Zuccaro pointed out that helicopter sales in Latin America now represent about 7 percent of the world market share, and sales in Brazil alone represent half of that share.
In fact, according to the 2nd Yearbook of Brazilian General Aviation released last year at LABACE, the total helicopter fleet in Brazil had reached 1,654 aircraft, 159 more than in 2011. Of that fleet 759 were 10 years old or older, and, of those, 292 were 20 years old or older.
Brazil also continues to be a major driving force behind Latin America’s emergence as a fast-growing market for helicopter support operations. Lìder Aviação (Chalet 5118)–with a fleet of more than 60 helicopters, more than 250 pilots and a new Sikorsky S-76 simulator from CAE SimuFlite (Booth 3004) that entered service last year–is just one of the market entities.
Other offshore operators in Latin America include Canada’s CHC, Brazilian Helicopter Services, Omni Aviation and Omni Táxi Aeréo, Era Group, and Helivia Aéreo Táxi. And nearly every helicopter manufacturer is represented, from AgustaWestland (Chalet 6106) and Eurocopter to Bell and Russia’s Kamov.
Russian Helicopters, a design and manufacturing company formed in 2007, is keeping a sharp eye on the Latin American market, according to Zilvinas Sadauskas, CEO of Locatory.com, an IT company supporting the aviation parts and supplies industry and based in Vilnius, Lithuania. In January, Sadauskas pointed out that since 20 percent of Latin America’s rotorcraft are of Russian manufacture, the company has begun to focus on civil markets, particularly in Brazil, Argentina and Mexico.
Russian Helicopters sees the Mi-171A2 as the successor of the Mi-8/17 family, which itself was specifically tailored to the Latin American market. “Although these are early times, the Mi-171A2’s potential in the Latin American market is undoubtedly robust,” the company said.
In December, Russian Helicopters and Brazilian operator Atlas Táxi Aéreo signed a $200 million deal for the acquisition of 14 Kamov-62 helicopters for offshore work. This was quickly followed by creation by the two of a joint helicopter service center in Brazil, operated by Russian subsidiary Oboronprom.
AgustaWestland/Embraer Negotiations Failed
If Brazil is the center of helicopter demand in Latin America, and it certainly seems that way, then the city of São Paulo is its heart. The fleet in service in the state of São Paulo numbers more than 400 helicopters, and in the city alone there are more than 250 helipads, slightly more than half of the total helipads nationwide.
Perhaps no more obvious proof of the potential market for helicopters in Latin America, and in Brazil in particular, was a memorandum of understanding signed earlier this year between Brazilian business jet manufacturer Embraer and helicopter OEM AgustaWestland. “This is an important step for Embraer as we continue expanding our business,” said Embraer (Chalet 5115) president and CEO Frederico Curado at the time. The deal would have established a joint-venture company in Brazil to manufacture and market helicopters.
“Brazil is an important market for AgustaWestland and we believe having an industrial presence in this country will help us to further grow our business in one of the world’s fastest growing markets,” added AgustaWestland CEO Bruno Spagnolini.
The two companies subsequently abandoned the effort, saying in a joint statement they had mutually decided to terminate negotiations on the project but offering no reason for scuttling the venture. Analysts subsequently believe Embraer will continue to explore the possibility of a domestically built helicopter, as part of the country’s overall aviation and aerospace expansion strategy.
Bell Has a Large Presence
Bell Helicopter is building a considerable stake in Latin America. At this point, of what the company estimates are 4,094 helicopters in the region, 1,311 are Bells. Of those, 331 are based in Mexico, 244 in Brazil, 182 in Colombia and 118 in Venezuela.
According to Bell communications manager Brian Bianco, the manufacturer is seeing the greatest market penetration with its Bell 407GX and 429 in the corporate and law enforcement sectors. In the offshore market, “our medium 412EP continues its success,” he said.
Bianco said the Textron company expects growth in these markets to continue in the short and medium term, but added, “The Bell 525 will be a game changer in areas like the Brazilian offshore market and will maintain Bell Helicopter as the primary platform for the Mexican offshore market as platforms go into deeper water and require longer flights.”
Bell expects its new Bell short light single (SLS) “will have immediate penetration into the corporate market segment in places like São Paulo where air taxi operations are almost nonstop.”
Robinson Sees Demand
Robinson Helicopter claims strong sales globally, marked by 195 R66 deliveries in 2012 and expectation of more than 200 deliveries in 2013. Roughly 20 percent of deliveries worldwide in 2013 are expected to go to Latin American customers. Robinson sales in Latin America are solely through a network of distributors, most of them via Audi Helicópteros and Power Helicópteros, both based in Brazil.
Robinson president Kurt Robinson said the R44 and R66 are well suited to transport into remote areas in Latin American countries where reliability is an absolute necessity. And the price point is also attractive, as is the fuel efficiency. The R44 Raven 2 is in the $450,000 range, while the R66 is priced around $800,000. The turbine-powered R66 sips fuel at the rate of about 20 gallons an hour, while the piston-engine R44 averages a miserly 15 gallons per hour.
The Honeywell helicopter-purchase outlook reflects the expectations of Bell, Robinson and other helicopter OEMs for not only Latin America but for the worldwide market. “This year’s stronger survey response indicates that the industry may be returning to a more expansionary environment,” said the report.
Latin America and Asia continue to have the highest fleet replacement and expansion expectations among the regions. The report’s authors added: “In terms of projected regional demand for new helicopters, Latin America and Asia remain in close competition to claim the world’s third largest regional market, following North America and Europe.”
If there is a problem facing the growth of helicopter operations in Latin America, it is one of safety. “The growth in the region has been explosive,” said HAI’s Zuccaro. “Anytime that happens, maintaining some kind of control is a challenge.”
Zuccaro said HAI safety representatives have made several trips to Latin America to sponsor safety seminars, and he added that several countries have created safety teams. “But the bottom line is that the industry is going in a positive direction, and industry and government are working to create an appropriate level of oversight, from heliports and service to maintenance and air traffic control.”