Is MDHI going to make it?

Of course the military and civil businesses are connected -- in the
design, engineering, and manufacturing technology. The military OH-6
gave Hughes/McD/MDHI a still-viable civil product line. The Sikorsky
HSS-2 launched the civil '61s. Take another look at the Eurocopter
military product line derived from their civil products -- their
military and civil business is now split about 50-50 thanks to
Puma/Cougar, Dauphin/Panther, etc.

If the commercial side of MHDI could never show a profit, the smart
thing to do was improve the bookeeping, not dump the product line and
deal yourself out of light helicopters. That's how Boeing got into this
position of buying back a shot at ARH.

HW

Helowriter wrote:
Of course the military and civil businesses are connected -- in the
design, engineering, and manufacturing technology. The military OH-6
gave Hughes/McD/MDHI a still-viable civil product line. The Sikorsky
HSS-2 launched the civil '61s. Take another look at the Eurocopter
military product line derived from their civil products -- their
military and civil business is now split about 50-50 thanks to
Puma/Cougar, Dauphin/Panther, etc.

If the commercial side of MHDI could never show a profit, the smart
thing to do was improve the bookeeping, not dump the product line and
deal yourself out of light helicopters. That's how Boeing got into this
position of buying back a shot at ARH.

HW

How many new OH-6s have been purchased in the last five years? The
European governments have had a vested interest in building up their
helicopter production capability for years and have been willing to
support it at any cost.

Straightening out the accounting was why the commercial side of MD was
given three years to turn a profit - they couldn't do it, even from a
clean slate. There were no military derivatives of any of the commercial
products that anyone was willing to buy. The U.S. Army had pinned its
hopes on Commanche and weren't about to go buy a passle of cheap
competitors to its sinkiing ship. Commanche was in enough hot water
without the Army asking someone to develop an alternative that Congress
could use against them.

The Europeans were buying militarized versions of their own civil
aircraft to reduce the red ink on their development. They certainly
weren't about to buy a bunch of militarized versions of MD commercial
helicopters. There was no market.

MDHI got a smokin' deal on the commercial business and still haven't
been able to make a go of it. I fail to see how holding on to a
money-losing operation with no potential for the future would be a smart
move. Sikorsky and Bell had most of the civil market wrapped up - MD was
a distant third, bleeding cash and losing steam.

Vygg

The MD500/M530/600 series share the OH-6 lineage. At least a few of
those have been sold commercially since the MDHI split. MDHI sold some
MDExplorers to the Mexican Navy, and some paramilitary versions in
Europe. The rotor system on the MELB was developed for the commercial
MD530F. That's the point - the civil and military markets and
technologies are complementary.

The Europeans didn't just buy militarized versions of civil aircraft to
improve their balance sheet. They developed dual-use aircraft to fill
their requirements from a domestic source. With a full product line,
Eurocopter can sell military or commercial as the markets shift. No, I
don't expect a commercial Tiger derivative, but giving Australia a
commercial helicopter assembly factory helped get that country to buy
the Tiger.

Technology development in military and civil helicopters is
interdependent. Rotor, transmission, HUMS, and other advancess carry
over from one market to the other. The flaw tolerance in the
commercial S-92 makes a very safe, crashworthy military helicopter (The
VXX competition chose to ignore that.) Commercial innovations -- HUMS,
on-condition maintenance -- can cut O&S costs for military operators.


Light helicopers have no future? Boeing abandoned the product line it
now needs to compete for a sizeable US Army order. It may have also
pushed itself out of the LUH contest. Tell me how that was smart
business.

HW

Helowriter wrote:
The MD500/M530/600 series share the OH-6 lineage. At least a few of
those have been sold commercially since the MDHI split. MDHI sold some
MDExplorers to the Mexican Navy, and some paramilitary versions in
Europe. The rotor system on the MELB was developed for the commercial
MD530F. That's the point - the civil and military markets and
technologies are complementary.

The Europeans didn't just buy militarized versions of civil aircraft to
improve their balance sheet. They developed dual-use aircraft to fill
their requirements from a domestic source. With a full product line,
Eurocopter can sell military or commercial as the markets shift. No, I
don't expect a commercial Tiger derivative, but giving Australia a
commercial helicopter assembly factory helped get that country to buy
the Tiger.

Technology development in military and civil helicopters is
interdependent. Rotor, transmission, HUMS, and other advancess carry
over from one market to the other. The flaw tolerance in the
commercial S-92 makes a very safe, crashworthy military helicopter (The
VXX competition chose to ignore that.) Commercial innovations -- HUMS,
on-condition maintenance -- can cut O&S costs for military operators.


Light helicopers have no future? Boeing abandoned the product line it
now needs to compete for a sizeable US Army order. It may have also
pushed itself out of the LUH contest. Tell me how that was smart
business.

HW

Monday morning quarterbacking is easy. Again, at the time that Boeing
divested itself of the commercial business there was no market for the
aircraft, it was losing money (a lot of money) and was in a distant
third place to Bell and Sikorsky with no hope of catching up.

You're assuming that Boeing is going to win the ARH. What if it doesn't
and they've already bought back MDHI? Boeing is in the same boat that it
was in when it first dumped the enterprise. No market, unsustainable
sales and heavy negative cashflow. Selling "some" Explorers to the
Mexican Navy every few years isn't going to keep the business viable.

A few months ago the conditions at MDHI were so bad that the mechanics
were taking their toolboxes home with them every night because they
didn't know if the doors would be chained shut when they came in the
next morning. Their only hope for the future is if Boeing wins the ARH.
If Bell wins - bye, bye MDHI.

The vast majority of rotary wing innovations are military shifted over
to civil. Not the other way around. A civilian aircraft doesn't have to
be built to continue to operate after taking a half-dozen 7.62mm rounds
through major wire bundles. Having a crashworthy civilian airframe is
nice - having an airframe that's difficult to bring down is even better.
The civilian market is for inexpensive aircraft that can be operated and
maintained at a profit - not an aircraft that has to be rugged enough to
handle abusive and hostile treatment. A couple of civilian innovations
that can be migrated over to military (with modification) is hardly a
reason to continue to pour cash into a limited opportunity.

HUMS was based on military innovations like LIMMSS. On-condition
maintenance is great as long as you have a regular flying schedule with
plenty of logistics support handy. In any case, those are support
technologies - you don't have to be in the business of building
helicopters to develop support technologies for them.

If Boeing hadn't sold the commercial side and ARH hadn't come along
you'd be criticizing them for making a bad business decision for holding
onto a losing proposition. It comes down to a basic question of business
- how much of your profitable operation do you sacrifice to shore up a
money pit, on the off chance that someday it may get better?

MD did that for years with its commercial aircraft business and it came
close to sinking the whole company. The end result was that it got
bought out by Boeing.

A lot of stars had to line up in order to get to the situation that
we're in today - the sudden cancellation of Commanche, a MELB based on a
highly modified existing civil airframe and the Army's insistence that
its next scout helicopter be based on an existing civil airframe as a
result. That's a lot to hope for when you're holding a money-losing
civilian helicopter operation that has a bleak future ahead of it
otherwise.

Vygg

Yep, that's me, Monday morning quarterback, Tuesday afternoon 'told you
so.' And now that ARH and LUH are here, I'm telling you it was a
mistake for Boeing to take itself out of the light helicopter business.
Now they have to buy the airframe from a shaky partner, and may lose
the ARH because of that. They also dealt themselves out of the
light/commerical tilt rotor business - and ancillary
government/military sales. (I know -- it's a fad, and Bell will never
sell more than a handful of 609s and derivatives.)

Salesmen make business -- if Eurocopter and Bell could sustain
commercial product lines in tough times, I suspect Boeing could have
too. Do you blame people for not buying MD600s and Exploriers from a
Dutch holding company when the two major suppliers have stable support
networks? That doesn't mean the product lines were losers. And it
doesn't mean the technology in them is worthless.

The composite blades finally in test for the AH-64 are made like those
already on the 530F (same autoclaves, too). Bell 430s were using that
four-bladed composite rotor head and blade technology way in advance of
the AH-1Z/UH-1Y go-ahead. A lot of that flaw-tolerant S-92 technology
makes good sense for a military operator who has to fly alot, take
battle damage, and stay within a budget. HUMS and lot of this dual-use
stuff evolves in parallel.

Commercial utilization rates are typically higher than military, and
commercial operators get real mad when they can't fly -- that gives you
RAM technologies directly applicable to military helicopters. I'm told
some of the latest FARs are tougher than MILSPEC.

Boeing figured 20-year sole-source military contracts like Chinook and
Apache modernization and V-22 and Comanche were sure bets -- ooops
Comanche wasn't a sure bet. Now, DoD has no problem going offshore for
helicopters. I don't think we should just surrender the market and the
industry to Europe. Monday morning, that might be good for business,
and Tuesday afternoon bad for the country.

HW

Helowriter wrote:
Yep, that's me, Monday morning quarterback, Tuesday afternoon 'told you
so.' And now that ARH and LUH are here, I'm telling you it was a
mistake for Boeing to take itself out of the light helicopter business.
Now they have to buy the airframe from a shaky partner, and may lose
the ARH because of that. They also dealt themselves out of the
light/commerical tilt rotor business - and ancillary
government/military sales. (I know -- it's a fad, and Bell will never
sell more than a handful of 609s and derivatives.)

Salesmen make business -- if Eurocopter and Bell could sustain
commercial product lines in tough times, I suspect Boeing could have
too. Do you blame people for not buying MD600s and Exploriers from a
Dutch holding company when the two major suppliers have stable support
networks? That doesn't mean the product lines were losers. And it
doesn't mean the technology in them is worthless.

The composite blades finally in test for the AH-64 are made like those
already on the 530F (same autoclaves, too). Bell 430s were using that
four-bladed composite rotor head and blade technology way in advance of
the AH-1Z/UH-1Y go-ahead. A lot of that flaw-tolerant S-92 technology
makes good sense for a military operator who has to fly alot, take
battle damage, and stay within a budget. HUMS and lot of this dual-use
stuff evolves in parallel.

Commercial utilization rates are typically higher than military, and
commercial operators get real mad when they can't fly -- that gives you
RAM technologies directly applicable to military helicopters. I'm told
some of the latest FARs are tougher than MILSPEC.

Boeing figured 20-year sole-source military contracts like Chinook and
Apache modernization and V-22 and Comanche were sure bets -- ooops
Comanche wasn't a sure bet. Now, DoD has no problem going offshore for
helicopters. I don't think we should just surrender the market and the
industry to Europe. Monday morning, that might be good for business,
and Tuesday afternoon bad for the country.

HW

The light airframes are still available if Boeing wins the ARH. MDHI is
shaky, but they only have to hold on long enough for AMCOM to make a
decision. If Bell wins the competition, Boeing isn't stuck with a
money-losing commercial operation. The decision to get out of the
commercial tilt-rotor was primarily a Bell decision - no market for the
aircraft. All of the tilt-rotor sales are for military, not an ancillary
government/military sale from a commercial product. Tilt-rotor has been
a military program from the beginning - not a commercial program with
military applicability. V-22 would have never been developed if it had
been a straight civilian product. The torrent of money put into it over
the years would have been turned off long ago if it were a commercial
aircraft - no way to ever make a profit after the development costs.

Salesmen make business - its easy when you already own the lion's share
of the commercial market (Bell) or have governments that protect the
industry (Eurocopter). A good product line that doesn't sell is a loser.
A technology that nobody is interested in has little worth in the
commercial industry.

Composite blades were originally in development for the AH-64A but MD
first used them on the MD-530 because the U.S. Army has always been much
more averse to advanced technologies than say, the USAF or USN. The MD
entry into LHX was viewed with suspicion by the Army because it used the
"unproven" NOTAR concept - the Army wanted something that they were
familiar with. Flaw tolerance isn't the same thing as rugged. A high UTE
rate in a stable commercial environment doesn't equate to a high UTE
rate in a combat environment. A commercial aircraft doesn't routinely
make high-speed descents into the trees, jink around, take fire and
still have to come home with the crew intact. The design, build and
performance criteria are very different between the two.

The FARs are getting tougher because the DoD stopped requiring MILSPEC
many years ago. In an attempt to "streamline" the procurement process,
the Pentagon decided that they would no longer require MILSPECs for new
aircraft acquisitions. Requiring FARs was a different matter. Not to be
outdone, the procurement types in the USG started migrating MILSPEC
standards into the FARs. We're gradually closing the circle on the old
onerous procurement process and will be right back where we started in a
few more years.

Boeing is the prime for Chinook and Apache. Bell is the prime for V-22
and Sikorsky was the prime for Commanche. Of the four aircraft
mentioned, Boeing's strategy is working.


I agree about surrendering the commercial rotary wing industry to Europe
being a bad thing for the country. But, you need to be talking to the
folks in D.C. about that, not the folks in Chicago. Boeing was skinned,
dressed and slow-roasted over an open fire for the 767T deal. They were
roundly criticized in public for trying to protect their commercial
B-767 product line by getting the USG to lease 100 aircraft. The company
will make the decision within the next couple of months whether or not
to terminate the product line as result of not having any future for it.
The European governments would have no problem with subsidizing their
commercial aircraft (or helicopter) industry in order to stay in the
game. That's a government decision, not a corporate decision.

Vygg

Vygg wrote

"The decision to get out of the
commercial tilt-rotor was primarily a Bell decision - no market for the

aircraft. All of the tilt-rotor sales are for military, not an
ancillary
government/military sale from a commercial product. Tilt-rotor has been

a military program from the beginning - not a commercial program with
military applicability."

Did you mean to write a Boeing or McDonnell decision? Bell in the end
was better off without Boeing as a partner on the 609, but at the time
BOEINGS decision to drop out almost killed the program. The engineers
at Boeing Vertol are some of the best, but their managers had no
concept on how to run a commericial aircraft program.

A Boeing Vertol management mentality of spending aircraft development
money on "engineering processes" instead of engineering design resulted
in Boeing claiming that they had completed 90% of all the 609
engineering. When Bell started opening files of what were supposed to
be stress analysis, what they found were one sentence notes stating
that the formal analysis would be completed at a later date. When all
Boeing enginnering was reviewed, it turned out they had only completed
about 40% of what they claimed. They had spent however over 100% of
what they were budgeted.

This is why Boeing Vertol managers were elated when presented the
opportunity to drop out of the 609 program. The grunt engineers
however were devastated. Many key engineers ended up leaving Philly
for Texas as a result

Take care,

CTR

CTR wrote:
Vygg wrote

"The decision to get out of the
commercial tilt-rotor was primarily a Bell decision - no market for the

aircraft. All of the tilt-rotor sales are for military, not an
ancillary
government/military sale from a commercial product. Tilt-rotor has been

a military program from the beginning - not a commercial program with
military applicability."

Did you mean to write a Boeing or McDonnell decision? Bell in the end
was better off without Boeing as a partner on the 609, but at the time
BOEINGS decision to drop out almost killed the program. The engineers
at Boeing Vertol are some of the best, but their managers had no
concept on how to run a commericial aircraft program.

A Boeing Vertol management mentality of spending aircraft development
money on "engineering processes" instead of engineering design resulted
in Boeing claiming that they had completed 90% of all the 609
engineering. When Bell started opening files of what were supposed to
be stress analysis, what they found were one sentence notes stating
that the formal analysis would be completed at a later date. When all
Boeing enginnering was reviewed, it turned out they had only completed
about 40% of what they claimed. They had spent however over 100% of
what they were budgeted.

This is why Boeing Vertol managers were elated when presented the
opportunity to drop out of the 609 program. The grunt engineers
however were devastated. Many key engineers ended up leaving Philly
for Texas as a result

Take care,

CTR

V-22 has always been a Bell-Boeing enterprise. MDHS didn't become a part
of Boeing until the buy-out. Boeing Rotorcraft was, and still is,
headquartered out of Philly. MD didn't have a say in the 609. I can't
speak for the management or operation there as I'm only familiar with
the Mesa site. The two operations just . . . well, to be diplomatic
about it . . . tolerate each other.

In any case, Bell is the prime for V-22/609 and it was their call to
terminate the commercial product. Boeing probably had an input, but Bell
made the final decision.

Vygg

Vygg,

The decision to drop out of the 609 was Boeing Vertols. No doubt with
some influence by Harry Stonecipher. Per the provisions of the
partnership contract, by dropping out Boeing was obligated to turn over
at zero cost to Bell all hardware and enginering they had created.

Originaly this appeared to be a windfall to Bell. But over the past
five years Bell and their new partner Agusta have been forced to
redesign almost every part originally designed or specified by Boeing.
In their rush to justfiy all the money they had spent, Boeing Vertol
managers (not the engineers) demanded the release of engineering that
had more in common with fantasy than fact.

One 609 supplier to Boeing told me that when when they responded to a
critical RFP technical requirement "What you are requesting defies the
laws of known physics!" Boeing managers responded "You are awarded the
contract to develop this device". Turns out that they were the only
ones to respond at all to the RFP. Bell ended up scrapping all Boeing
engineering for this design and starting from scratch. Kept the same
supplier though. Honesty has its rewards.

Take care,

CTR

Hate to tell you, but the commercial 609 is still quite alive, and Bell
claims an order backlog. Bell market studies a couple of years back
projected 45% of the small tilt rotor market would be US and foreign
governments.

Whatever the origins of the Apache composite blade, going back to the
AH-64B, MSIP, etc. the technology to make the things got a chance in a
commercial development - 530F. That's how these things sometimes work,
and denying yourself a commercial avenue denies you development
opportunities that pay off later. Would Boeing Mesa have been better
just learning how to make the Apache blade from scratch today?

Flaw tolerance does indeed equate to ruggedness - the margins to
tolerate flaws caused by damage and keep flying. That is a good thing
for any helicopter - military or civil.

HW