Bombardier Sales boosted by Latin America

Boeing looks like it is expanding operations in the south of the US, having recently acquired a fuselage-assembly facility in Charleston, South Carolina. The possibility of it housing its second 787 assembly line there has also increased, which could signal the beginnings of a shift away from its Washington base.
The major reason for this is that the manufacturer appears to consider the Machinists union in Washington to be too strong - unions are much weaker in South Carolina, for instance. The International Association of Machinists and Aerospace Workers, which represents about 25,000 Boeing machinists in Washington, is already said to be reeling from the prospect of Boeing housing a new assembly plant anywhere but Washington. The union and Boeing are reported to be at loggerheads over a no-strike deal the manufacturer would insist on in selecting a production site.
The complexities of the 787 production process appear to have given Boeing the chance to decrease its reliance on the union and its Washington home, thus putting it in a stronger bargaining position, at the very least. But then we have already seen that Boeing's decision to outsource parts of the 787 construction to outside contractors sparked a major strike at factories around Seattle; one of the major reasons for the lengthy delay in getting the 787 to the market.
As well as Washington and South Carolina, Boeing is believed to be looking at sites in Texas and other southern states for the second 787 assembly plant, as it bids to ramp up production to make up for the lengthy delays. It will select a site for the new assembly line by the end of the year.
Not included in Bombardier's numbers are turbine helicopters used for business purposes, an increasingly important resource for companies in the crowded São Paulo area, where there are about 500 helicopters that can fly to around 230 heliports.

OceanAir, a distributor for AgustaWestland in Brazil, has seen its helicopter business increasing by 30-40% a year over the past two years and will sell in the region 25 new and five previously owned helicopters this year, says Brandao. The company is also a distributor for Pilatus aircraft, which produces five PC-12s a year for Brazil. Brandao says there are 16 PC-12s flying in Brazil and there will be 20 by the end of the year. "We sell whatever we can get from the manufacturer," he adds.

INTEREST FUELLED

The favourable factors in Brazil are fuelling interest in LABACE. ABAG's Aquino says there will be 100 exhibitors at the show, up from 70 last year and including all major business jet manufacturers. There will also be at least 60 aircraft on static display at Congonhas airport, up from 48 last year, he adds.

One of the exhibitors, Italy's Piaggio, will be making its first appearance at the annual show, first held in 2003, as part of a new marketing strategy for its P180 Avanti II twin-engined turbo­prop in Latin America. Along with gaining Brazilian certification for the Avanti, Piaggio is looking to appoint dealers throughout the region. John Bingham, Piaggio America executive vice-president marketing and sales, says Brazil represents a huge untapped opportunity for the Avanti that Piaggio has never explored.

Bingham says the Avanti is particularly well suited for flying in the Amazon, but it should be well received across the country by both the owner-flown community and corporations. Piaggio plans to use LABACE to look for agents for Argentina, Brazil, Chile, Colombia and Venezuela as well as for Central America - most likely Panama - all locations where the airframer has never had representation.

On the lighter side of business aviation. Italy's Vulcanair will bring its twin-engined P68s to LABACE for the first time. Representing business jet interests will be Bombardier, Cessna, Dassault, Embraer and Gulfstream.

Gulfstream has grown its mid-cabin presence in the region by 450% and its large-cabin presence by 55% between 2004 and 2008 - up to 22 aircraft from four aircraft for the midsize models and up to 70 aircraft from 45 for the large cabins. The company earlier this year slashed production of its G150 and G200 models to 24 aircraft, down from 32 in 2008, and says it may have to cut further due to the "price point" of the models.

Dassault claims market leadership in the wide-cabin sector in Brazil, with 20 aircraft in operation there, a number it expects to double in the next five years. To better service the fleet, the company has applied to the US Federal Aviation Administration and the European Aviation Safety Agency for approval to work on US and European-registered Falcon aircraft at its new factory-owned service centre in São Paulo. The company earned Brazilian repair station certification for the facility in June.

Cessna chief executive Jack Pelton says Brazil is the manufacturer's third-largest market after Europe and the USA and continues to grow despite the global downturn. "It's not as hard hit as other markets," he says. The Citationjet and Caravan turboprop lines are selling well there, with the jets used for long-distance travel between cities and the Caravans accessing some of Brazil's unimproved airfields, particularly in the Amazon region. Pelton says overall sales in Latin America are up this year while nearly every other region is down.

Second to Cessna in terms of market share is Bombardier, with nearly 400 aircraft representing 27% of the market in the region, says Fabio Rebello, Bombardier regional vice-president for sales in Latin America. Although sales in Mexico have been hit by the financial crisis in the USA, given how the two are connected in commerce by the North American free trade agreement, Rebello says Brazil has largely avoided a credit crisis. Banks have continued to provide loans and sales have remained relatively strong with internal demand.

For Latin America in general, Rebello says he expects to see 2008-type growth numbers return in the 2012 timeframe.

Brazil-based Embraer is likely to shake up the market share figures with the recent service entry of the first of its new line of very light, light and midsize business jets. The company delivered its first six-seat Phenom 100 very light jet into Brazil at the end of June, seven months after US deliveries began. Of the more than 800 orders the company has secured for the Phenom 100 and the soon to be certificated Phenom 300 light jet, more than 100 are for Latin America and 70% of those are for Brazil.

Aquino is working to make Brazil's infrastructure more welcoming to those jets before the World Cup. In his opening LABACE speech, he will lobby for the construction of new airports. "We are working with the government, exerting pressure to bring new airports for business aviation," says Aquino.