Helicopter suppliers must modernize, says defense industrial policy chief.

The Defense Department predicts that military helicopter suppliers likely will recover from the current slump in aircraft production, but the cure will require significant investments in new manufacturing technologies.

Existing overcapacity in the helicopter industry should subside as programs such as the V-22 Osprey and other aircraft begin full production, says Suzanne Patrick, deputy undersecretary of defense for industrial policy.

Helicopter manufacturers, additionally, will need to gain a competitive advantage by becoming more innovative in their designs and production, Patrick tells National Defense in a recent interview.

Robust manufacturing programs, she says, will attract engineers and help revitalize the aging rotorcraft industry work force. In a report Patrick released last year, she concludes that remanufacturing and upgrades alone would not compel the helicopter industry to develop next-generation technologies needed for 2020, and beyond.

"We've tried to get at the root causes for the lack of innovation," she says. The report warned that without improved technology, major U.S. rotorcraft manufacturers could lose business to foreign competitors.

All three major domestic military helicopter manufacturers are busy remanufacturing or replacing aircraft that were damaged or destroyed in combat. Bell Helicopter is producing 180 AH-1Z attack and 100 UH-1Y utility helicopters for the Marine Corps. Boeing is delivering 517 modernized and new Longbow Apaches and will manufacture 513 new Chinooks to the Army, Sikorsky will soon start on 254 new Seahawks for the Navy and 1,213 new Black Hawks for the Army:

An opportunity for the industry to design and manufacture an entirely new rotorcraft may arrive if the Defense Department decides to fund a joint-service heavy-lift aircraft that would be fielded around 2020. The Marine Corps plans to replace its aging Sikorsky CH-53E Super Stallions with 154 new CH-53Xs, which would enter service in 2015.

Upcoming military helicopter competitions, meanwhile, will seek bids that are based on existing commercial aircraft, and will not require substantial development of new technologies. Examples of this trend are the Air Force personnel recovery vehicle and the Army armed reconnaissance and light utility helicopters.

The Air Force PRV, however, will require advanced mission equipment and has demanding performance requirements for propulsion, flight control and vibration control. "It will be up to the Air Force to determine how much they want to fund the integration of this off-the-shelf technology," says Patrick. The service wants 141 new helicopters to replace Sikorsky Pave Hawks.

A solicitation for industry bids is scheduled to be released this summer for a contract award by February 2006. The helicopters would be in operation by 2011. Competitors right now include the Bell Boeing V-22, Boeing CH-47, Lockheed Martin US101 and Sikorsky H-92.

The Defense Department also will factor safety features into the selection of new helicopters, Patrick explains.

A Pentagon report released a year ago, "The Vertical Lift Industrial Base: Outlook 2004-2014," warned that widespread lack of innovation in the rotorcraft industry could jeopardize the Defense Department's plans to modernize the force. "It is only through an open, competitive market that the department can meet its goal of procuring the best weapon systems," adds Patrick.

Contractors should get extra credit for "lean manufacturing facilities and state-of-the-art manufacturing facilities," she adds.

The Pentagon's industrial policy office in 2002 characterized the U.S. helicopter industry as a "1970s-vintage cartel" that relies on sole-source contracts and teaming arrangements. Patrick now backs off from that assessment. "The term cartel was not accurate nor indeed fair," she says. "In part, the behavior of the government with regard to how we structured opportunities might have been a bit at fault as well."

Patrick characterized European suppliers as "sound competitors ... in very large measure because the Europeans, as a group, made helicopter manufacturing an industrial base priority in which they've invested."

She predicts that European helicopter manufacturers increasingly will be partnering with U.S. firms. The Defense Department is comfortable working with foreign suppliers, she adds. "We don't believe we have a global monopoly on good ideas ... We will mitigate the risk of foreign procurements in a way that we believe is prudent. But if the best value, the most innovative solution, comes to us from a foreign source, we will consider it."

The push for global competition in the U.S. rotorcraft industry comes at the same time NASA has stopped funding basic rotorcraft research and elected to close its full-scale wind tunnel and crash test facilities. Science and development efforts for military aircraft now are the responsibility of the Pentagon's director of defense research and engineering.

Steve Thompson, who works with Patrick on helicopter issues, says research funding decisions are based on practical considerations. "We don't have the resources to pursue technology for the sake of technology."

The office of industrial policy, however, is pushing helicopter makers to invest in advanced manufacturing technologies comparable to what is found in fixed-wing aircraft factories. "We as a department may not have done as good a job incentivizing lean manufacturing for vertical-lift platforms as we did for the fixed-wing platforms," concedes Patrick. "I think that great strides have been made over the last year or so ... But if you look back over the last decade or so, it's very dear that the vertical-lift industrial base has lagged in some areas relative to the fixed-wing industrial base."

"Lean manufacturing" is a term that is used to describe efficient production processes that help cut costs and improve quality. Thompson believes the rotorcraft industry has made significant progress since the office of industrial policy first addressed the state of the industry in 2002. "I've always been encouraged by what we saw at Boeing Mesa in the Apache production line," he says.

Boeing Mesa traded old-style static aircraft assembly positions for a moving line in January 2000 and soon increased output from three aircraft per month to six, say company officials. The Apache assembly line can be adjusted to accommodate changing delivery rates. Lean manufacturing also has helped blend remanufactured and new-build Apaches for the Army and international customers on the same line.

The U-shaped Mesa assembly line has 15 aircraft positions, each with a team of trained workers. To save labor costs, parts are kitted in shadow boxes and tools are arrayed in drawers for each aircraft batch. Engines, transmissions and other subsystems are prepared on feeder lines beside the moving aircraft. Printed work instructions specify assembly sequences, and many provide assembly graphics.

Similar techniques are employed by Boeing Philadelphia for the V-22 and CH-47 production. Bell Helicopter has introduced similar improvements on the V-22 assembly line in Amarillo, Texas.

Sikorsky Aircraft has adopted lean manufacturing, as well. The commercial S-76 is now built in a paperless environment with graphic workstations and notebook computers, instead of printed work instructions. The assembly line is tied to three-dimensional computer-aided design tools. Approved engineering changes once took four months to reach assembly-line workers. The current objective is four milliseconds, says a company spokesman.

The labor hours on S-76s dropped from 2,400 hours to 850 hours. The old line averaged 250 discrepancies per aircraft. It now has fewer than 25. The same benefits may extend to the military H-92, UH60M, MH-60S and MH-60R assembly lines, the company says.

Lean manufacturing has been applied to the Black Hawk and Seahawk tail rotor blades. A composite tail rotor blade spar in a traditional process typically required 80 days. Current spars take just 14 days using same number of people. According to Sikorsky, only 65 percent of the blades from the old line were usable, but now that percentage is up to 98.

Under the pressure of global competition, U.S. rotorcraft manufacturers are evolving into more efficient and flexible businesses, Patrick says. "It took the department and industry more than 15 years of sole-source remanufacturing of legacy platforms to get to their present state," she mentions. "We will not turn this situation around overnight."