Helicopter capability - Defence Committee Contents

Memorandum from AgustaWestland


    — A balanced fleet of helicopters on expeditionary operations saves both resources by adding mobility and thus reducing the overall force levels required and saves lives by reducing risk and providing a unique capability for the evacuation of casualties.

    — Reducing the number of helicopter types in service would create savings across the lines of development.

    — The Strategic Partnering Agreement between the MoD and AW is driving down costs of both procurement and support. There are more gains to be made if partnering is developed further.

    — The Integrated Operational Support concept is improving the availability of aircraft and will, over time, further reduce the cost of ownership of MoD aircraft.

    — Helicopter aircrew and maintainer training is an area where opportunities exist for greater innovation and savings to be made.


  1.  AgustaWestland, a Finmeccanica company, is a world leader in the helicopter

market. AgustaWestland has the technology required to undertake the design and development of helicopters and tiltrotors for civil and military .use from the preliminary analysis and definition of operational requirements to the design, development and production of transmissions, rotors, metal and composite structures and avionics systems, as well as their integration into a complete "helicopter system". The company also specialises in the provision of helicopter maintenance support and training services.


  2.  Over the last 50 years helicopters have changed the way the Armed Forces fight maritime and land operations. Although often perceived as expensive to procure and support, helicopters bring capabilities such as firepower, range and mobility, which enable the size of deployed expeditionary forces to be smaller than they would otherwise have to be. This is particularly the case in Afghanistan today where the distances are great and the terrain unforgiving.

  3.  A balanced mix of attack, light, medium and heavy lift helicopters gives force commanders greater flexibility and tactical options. Helicopters save lives by enabling troops to move beyond the threat of the ground-based IEDs as well as the means to rapidly evacuate casualties from the front line. Therefore the cost effectiveness of helicopters should be viewed not simply in terms of platform and-support costs but also against the wider savings of reduced overall force numbers, combat effectiveness and the saving of life and limb.


  4.  There is still a significant degree of fragmentation across the UK's helicopter fleet with some 10[4] different types of helicopter in operational service (not including training). It is predicted that the overall MoD helicopter fleet numbers will reduce in the next decade. Operating many relatively small fleets of very UK bespoke helicopters[5] is expensive in terms of support, training and modification costs. As these smaller fleets are extended into old age the MoD is likely to have to face increasing costs and safety risks due to obsolescence and fatigue. There are, therefore, likely to be broad cost savings across all the lines of development if the number of types in service is reduced.


  5.  The Defence Industrial Strategy of 2005 and the Strategic Partnering Agreement (SPA) signed by the MoD and AgustaWestland (AW) in 2006 now provides the basis for joint MoD/industry future planning and the maintenance of the UK's legacy fleet. This has resulted in more cost effective maintenance for the MoD based around the Integrated Operational Support (IOS) concept, where AW is incentivised to achieve high levels of aircraft availability and fixed maintenance costs with more of the risk being taken on by industry than ever before. The Sea King and Merlin IOS contracts were approved by the MoD only after savings of greater than 10% and 20% respectively was demonstrated. Proof of the benefit of these contracts is being demonstrated today where the Merlin IMOS contract is taking corrective action on the RN Merlins where corrosion has occurred with no extra cost to the MoD. Prior to the IMOS contract the MoD would have had to fund all of this additional activity. Industry has also demonstrated it is prepared to partner on development and procurement with AW taking on additional financial risk following the renegotiation of the Future Lynx contract in order to match the MoD's funding profile without any substantial loss of operational capability.

  6.  Partnering and the ever closer and more open relationship that it brings, has the potential to enable industry and the MoD to get together and plan strategically in the interests of both parties. This would provide a more coherent longer-term level of predictability that enables the prime contractors to align and maintain the industrial health of their supply chain as well as the operational sovereignty of key future capability requirements as required by DIS. This is an important driver towards keeping costs down. In addition, the closer the intellectual relationship the greater the chances are of creating innovation and of sharing the risks with increased confidence by industry to make PV investments. However, the challenge for both sides is that while the UK approach to competition remains one of the most open in the industrialised nations, the relationship between competition and partnership requires further clarification and understanding if partnering is to move into its next, potentially even more productive, phase.

  7.  The important procurements relevant to the Helicopter Inquiry's focus on Afghanistan and Iraq are concentrated mainly on maintaining and increasing battlefield helicopter lift; these include the recent Merlin Mk3A acquisition, Sea King performance enhancements and the potential life-extension of the Puma. The recent confirmation of the Future Lynx for the RN and the Army will also provide a multi-role light lift capability as well as reconnaissance and surface attack capabilities. An example of a successful helicopter capability upgrade is the integration of the Carson rotor-blades to the Sea King, which demonstrates how a partnering approach has resulted in a competitor's blade being fitted to the aircraft to the mutual benefit of the Armed Forces and industry.

  8.  The Future Medium Helicopter programme will potentially play a dominant role in the competition for the scarce resources likely to be available for future procurements. This will inevitably require the MoD to prioritise its requirements and take risks against operational output as it is not clear that all the programmes are affordable within the current budgets. But it is also the responsibility of industry to play its part to ensure that the provision of essential helicopter capability is as affordable as possible. Industry would therefore welcome clarity on the relative priority and costs likely to be afforded to each programme to aid planning and risk related investment. In addition a stronger focus for a coherent tri-service helicopter strategy energised by a single senior point of contact within the UK MoD would also be welcomed.


  9.  The support structure underpinning helicopter operations is an area undergoing significant change. Prior to the introduction of the Integrated Operational Support (IOS) schemes the MoD was responsible for all elements of the aircraft's support from the front line to depth maintenance facilities. This included the timely and accurate ordering of aircraft spares and support equipment. Industry provided 4th line support which centred upon technical product support and additional repair and overhaul capacity.

  10.  The concept of an IOS scheme is to transfer more responsibility and hence risk to industry, allowing the MoD to focus on the support to the aircraft on deployed operations and those preparing for deployment. Within an IOS scheme, MoD defines a flying hour requirement and fleet size, industry is then required to deliver the requisite number of aircraft to the MoD. This entails industry being wholly responsible for all support elements from determining the number of spares to buy and hold in stock right up to managing the depth maintenance facilities. Payment is also linked to the achievement of flying hours which ensures that industry are fully incentivised to improve any weaknesses in the aircraft or support structure.

  11.  Sea King Integrated Operational Support (SKIOS) was the first contract to be signed in 2005 for the support of 130 RN and RAF Sea King aircraft. The Integrated Merlin Operational Support (IMOS) contract, signed in 2007, provides long term. support that incentivises industry provide continually improving performance for all Merlin helicopters. Although still in its early phase, the IOS concept is successfully increasing aircraft availability to the MoD at reduced cost and AW are planning to further reduce the cost of ownership as a result of the incentives inherent within these contracts.

  12.  Established in March 2007 as an SPA initiative, the Joint Modifications Scheme (JMS) has corralled work on modifications and Urgent Operational Requirements (UOR) under one collaborative MoD and AW organisation. It has taken on 490 modifications since its launch, including 40 UORs, and is another positive example of how a MoD and industry partnership can cut out process and time arid deliver an improved helicopter capability to the front-line.

  13.  AW continues to develop a range of training capabilities to meet the training requirements of all three services. In particular, Apache training delivered through Aviation Training International Ltd (ATIL a 50:50 JV with Boeing), is delivering real benefit to crews as they train for operations; pressure on front-line crews is also being relieved through the provision ATIL instructors to supplement Army Instructors on the Apache conversion unit. Training of helicopter aircrew and maintainers remains an area where there are many opportunities for innovation, particularly to reduce the time spent by service pilots in training and to make savings through initiatives that reduce the overall MoD balance sheet.

2 April 2009

4   Lynx (4 marks), Merlin (2), Apache, Chinook (2), Puma, Sea King (5), Bell 412/212 (2), Gazelle, Dauphin, AW109. Back

5   The average fleet size in 2009 of the top 8 types/marks is around 50. This average figure is likely to reduce. Back

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Prepared 21 July 2009