The day may not be far off when the traditional sale of a flight simulator to an airline is the rarity rather than the rule. More and more airlines are opting for outsourcing, at least for the management of the training operation and often for the pilot instruction as well.
Japan Airlines (JAL), for example, which purchased its first simulator from CAE 30 years ago, is now partnered with the Canadian company in a joint venture launched in April to provide flight crew training services across Northeast Asia. The deal combines JAL’s training center in Tokyo with CAE’s facility in Seoul, Korea, which together have a dozen sims. CAE (Chalet 56) is also managing JAL’s multi-crew pilot license (MPL) cadet training.
In November, CAE and low-cost carrier Viva Colombia will open a new training center in Bogota under a long-term agreement to train A320 pilots. By mid-2016, CAE will install the first level-D full-flight simulator (FFS) for Aircraft Industries’ L410 turboprop as part of a cooperation agreement with the Czech Aviation Training Center in Prague. CAE has also forged alliances with carriers such as AirAsia, Air Canada, China Southern, Emirates and Iberia since it expanded into training services in 2000.
“My desire is to accelerate our activities on the training side of the business,” said Nick Leontidis, CAE Group president for civil simulation and training. “I’d like to see that part of the business move quicker. We’ve invested heavily the past 15 years in our footprint, building training expertise and IT systems, running training systems. We think we now have the credibility to talk with major airlines about training their pilots.”
Training’s Grail: Asia
Other simulator manufacturers are also pursuing the steady-revenue grail of recurrent training, with most of them focused on Asia where the largest aircraft fleet growth is expected.
Rockwell Collins (Chalet 21, Hall 2b D108) and Aviation Industry Corporate of China (AVIC) subsidiary Beijing Bluesky Aviation Technology formally launched their Accel joint venture in March with a new flight training facility in Tianjin, about 90 minutes outside Beijing. Though the initial focus is Boeing 737 and Airbus A320 operators in China, Rockwell is also targeting narrowbody aircraft operators in Southeast Asia, India, and South America.
In Bangkok, Thailand, L-3 Link Simulation and Training (Chalet 306, Static C2), which acquired the UK-based commercial airline flight simulator business of Thales three years ago, now has A320 and A330 FFSs and three level-D ATR devices in their wholly owned Asian Aviation Training Center. It even offers a “fear of flying” course for passengers.
Textron’s year-old TRU Simulation + Training (Static A4) opened a training center joint venture at the end of last year in Rekjavik to train Boeing 757 pilots for Icelandair. The project began under Opinicus, which together with Montreal-based Mechtronix, was acquired in 2013 to form TRU.
Another relatively new entrant, Venyo (Hall 2b G81), hopes to deliver its first Boeing 737NG full-flight simulator next year. The Brussels, Belgium-based startup is opening a Florida office and will seek U.S. FAA qualification for its new simulator.
The former Sim-Industries, rebranded earlier this year as Lockheed Martin Commercial Flight Training (Chalet 316, Static C2), offers flight training services in São Paulo, Brazil, and Incheon, Korea.
OEMs Control Syllabus
Aircraft manufacturers Airbus (Hall Concorde 17) and Boeing (Chalets 321, 324) have become more assertive, both in controlling the content of the training syllabi for their aircraft and in delivering flight training directly to airline users. Airbus is establishing a training center in Manila, the Philippines, with A320 and A330/340 simulators.
The Airbus training network also includes its Toulouse, France headquarters, the U.S. (Miami), Germany (Hamburg), China (Beijing), and India (Bengaluru). Early next year, the eight-simulator-capacity Airbus Asia Training Centre is scheduled to open in Seletar Aerospace Park, Singapore, a JV with Singapore Airlines offering A320, A330, A350XWB, and A380 training.
Airbus announced in April a three-year agreement with FlightSafety International’s academy in Vero Beach, Florida, to offer first officer, MPL, and North America airline transport pilot-certified training program (ATP-CTP) ab initio courses.
Boeing Flight Services (née Alteon) has primary training centers in Miami, London and Singapore, and more than a dozen satellite sites worldwide–some company-owned and others with airline partners such as Virgin Australia in Brisbane and Buenos Aires, Argentina, with Aerolineas. Once partnered with FlightSafety, then Thales, Boeing’s newest simulator partner is Textron’s TRU, from whom it has ordered four FFSs for the new 737 MAX aircraft as part of a 10-year agreement.
Independent training provider CTC Aviation is expanding with new crew training sites at London Gatwick and Coventry, UK, bringing their locations to seven. L-3 Link has supplied a level-D A320 FFS for Gatwick, and a Boeing 737-800W model is due to be certified this month. Clients include British Airways, easyJet and Qatar Airways.
Baltic Aviation Academy in Lithuania is expanding beyond Vilnius via partnership with Haite Aviation Training Singapore, a subsidiary of Sichuan Haite High-Tech Co. of Chengdu, China. Its $71 million six-story facility is currently equipped with B737-800W and A320 simulators, and could be expanded in the future to seven devices.
There’s even a new Pacific Sky Aviation training center planned for Victoria, British Columbia, by mid-2016 for the new Twin Otter Series 400 amphibious plane being developed by Viking Aircraft. Once National Research Council aircraft flight testing is complete, Textron’s TRU will use the data to build an FFS at its Montreal facility for level-D qualification by Transport Canada.
CAE Dominates Hardware
Of course, there are still direct sales of simulators. FlightSafety won a deal with the Civil Aviation Bureau of Japan for a B777-300ER Level D simulator to be delivered in 2018. L-3 Link announced its fifth A320 RealitySeven FFS for Sichuan Airlines in Chengdu, China, to be ready for training at the end of October 2015.
TRU received qualification from the Australian Civil Aviation Authority (CASA) for a Mechtronix-design A320 FFS X for Ansett Aviation Training in Melbourne, and a letter of intent for a similar device from Pan Am International Flight Academy in Miami. Frasca International received Civil Aviation Administration of China (CAAC) level-D approval for a Cessna Citation CJ1+ business jet FFS for Nanshan International Flight Academy in Longkou.
But whereas most of the simulator manufacturers tout one-off sales, CAE announces them in bunches, five or six sims at a time. Since last July, CAE has issued nine-figure press releases totalling $718 million and a total of 41 FFS sales for their Fiscal Year that ended in March. The year earlier, it posted an industry-record 48 FFS sales. Granted, some of those sales are to their own joint ventures, but CAE’s dominance of the hardware market is clearly evident in the numbers, estimated at 75 to 80 percent of competed sims.
Forecasts of the total civil aviation simulation and training market vary, depending on which elements are being counted. Frost & Sullivan pegs the simulator market at $1.06 billion in 2014, to rise to an estimated $1.43 billion by 2020. The flight training services market is slightly higher at $1.44 billion in 2014, but relatively flat at $1.54 billion five years hence. Analyst firm Visongain estimates the combined market significantly higher–$6.16 billion in 2015.
Speculation among industry insiders is that the market cannot sustain more than two or three viable simulator vendors. “This is a relatively niche business with a defined volume,” CAE’s Leontidis noted. “It’s hard to see how this number of companies can make a business case selling three, four or five simulators a year.”