An Airbus Military View on the LIft and Tanking Markets, May 2013


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During the Airbus Military Trade Media Briefing 2013, held on May 29th and 30th 2013, Rafael Tentor, Senior Vice President of Programs, provided an overview of how the company views their market.

The key point is that with the new tanker and airlifter joining the CN-235 and C-295, the company appears well positioned for the period ahead.

Published in: News & Politics, Business, Travel
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An Airbus Military View on the LIft and Tanking Markets, May 2013

  1. 1. Airbus Military Market Status and ChallengesMay 2013Presented byRafael Tentor, SVP Programs
  2. 2. •Market situation and AM positioning•A400M: right aircraft at right time•A330 MRTT: only new generation tanker flying•Opportunities for our Light & Medium aircraft(*) Services covered in separate presentation
  3. 3. Military Market situation• Europe at turning point : growing demands (Libya, Mali...) versusshrinking defense budgets• Reduced investment in R&D and R&T by governments, increasedpressure on industry: but A400M and MRTT at technology edge• Flat defence spending for next 5-10 years in traditional marketswhile missions increase: driving need for multi-role equipment• Growing defense markets in emerging countries which requirelocal industry partnerships and fair value workshareAirbus Military well positioned with modern, cost-efficient, multi-roleaircraft and clear internationalization strategy and footprint
  4. 4. 05010015020025000 01 02 03 04 05 06 07 08 09 10 11 12COMP AM MRTTAM A400M AM L&MMilitary market is inconsistent• 2011 extremely weak as contracts were postponed• 2012 very strong year2012: very good year for AM with many contracts finalised• 2012 sales in the categories inwhich AM competes:• 42 for L&M*• Inc 32 Airbus Military• 68 for Heavy Transports**• Nearly all US/Russia• Zero MRTT deals• Delayed selectionsbuilding up for future(*) 10 C27J Australia(**) 16 C130J USA, 1 Norway, 10 C17 USA, 1UK, 1 Australia, 39 IL-476 Russia
  5. 5. • Airbus Military sales:• 1 CN235 for Cameroon AF• 1 CN235 for Irish Air Corps• 2 additional CN235s for the USCG• 3 additional C295s for Egypt• 2 C295 for Kazakhstan AF• 8 C295 for Oman AF (incl. 4 MPA)• 5 C295 for Poland AF• 9 C295 for Indonesia AF• 1 more C295s for Colombia AF• Competition sales:• 10 C27J for Australia (FMS)NEWCUSTOMERAM 2012 sales at a glanceNEWCUSTOMERREPEATORDERREPEATORDERREPEATORDERREPEATORDERREPEATORDER
  6. 6. AM Market Share 2003-2012MRTT/TankersLight & Medium HeavySales as of 4Q2012. (*) KC46 contract not includedCN235 C29551%; 157 a/cALLCOMPETITORSTOGETHER49%; 149 a/cTOTAL Sales: 306 a/cAM Sales 157 a/c51%C-130J 41%;218 a/cA400M32%;174 a/cC-17 27%;145 a/cTOTAL Sales: 537 a/cAM Sales 174 a/c32%A330MRTT88%; 28 a/cKC-76712%; 4 a/c(excl. KC-46A)TOTAL Sales: 32 a/c*AM Sales 28 a/c88%
  7. 7. 1086 a/c sold to 138 customers in 66 countriesAirbus Military - Total Sales to 1Q201381 North America2 A310MRTT28 CN23551 C2122 Countries23 Customers142 Latin America31 C29520 CN23591 C21216 Countries27 Customers51 Africa (Sub.)2 C2957 CN23542 C21212 Countries15 Customers70 MENA9 A330MRTT28 C29525 CN2358 C2129 Countries9 Customers238 Asia & Pacific5 A330MRTT4 A400M9 C29574 CN235146 C21211 Countries30 Customers504 Europe+CIS4 A330MRTT14A310MRTT170 A400M51 C295125 CN235140 C21216 Countries34 Customers
  8. 8. Non-US Military Expenditure Trends020406080100120140BrazilChina, P. R.JapanIndiaFranceGermanyRussiaUKSaudi ArabiaTop Ten Country Expenditure Trends over the last 10 years, excluding USSource; SIPRIChina, Russia and Saudi Arabia experienced the largestexpenditure growth outside of USA in recent years
  9. 9. Geophysical events(i.e.earthquake)Meteorological events(i.e.storm)Hydrological events(i.e.floods)Climatological events(i.e.wildfire)Source :Munich RE-NatCatSERVICE 2010-2011 Main Natural disasters/ International Committee of the Red CrossNatural disastersHowever, Civic and Humanitarian missionsrequire more and more effort every yearOil spills•More than 2 billion people affected by natural disasters during last decade•On average, 62,000 lives lost per year•5.7 million tons of oil lost as a result of tanker incidents from 1970 to 2010•In 2011, 9 organizations involved in 52 operations with a personnel of some262,000. More than 90 % of these were from NATO and the UN…
  10. 10. AM products, specially well adapted tothis challenging situationMay 2013• When there is little money to spend,multipurpose aircraft cover all needswith less investment…Up to 300 soldiersVIP transportNot only the most capable tanker…Medevac Freighter(up to 45t)•Strategic airlift, plus•Tactical capability, plus•Air-to-air refueller•General transport, plus•Troops/parachutists,•Medevac, humanitarian aid,•MPA, ASW, SIGINT…CN235&C295
  11. 11. •Market situation and AM positioning•A400M: right aircraft at right time•A330 MRTT: only new generation tanker flying•Opportunities for our Light & Medium aircraft
  12. 12. A400M is the only airlifter with combinedstrategic and tactical capabilitiesTacticalCapability:short, soft,austerefieldsStrategic Capability: Payload-RangeTacticalTransportsC-130C160… fills the currentlogistic/tacticalcapability gapA400MStrategic AirliftersC-17, An-124, An-225Challenging old standards
  13. 13. The right concept...Putting what’s wanted, precisely where it’s neededThe very few costly StrategicAirlifters such as An-124 and C-17 cannot airlift heavy andoutsize loads directly to unpavedairstrips.Airlifters such as C-130 havegood tactical performance butcannot accommodateheavy and outsize loadsdue to weight and/or volumerestrictions.
  14. 14. …at the right time…Increased number of local conflicts: Mali, Libya, Afghanistan,…Increased need for deliveringhumanitarian aids to remote areasPutting what’s wanted, precisely where it’s needed
  15. 15. ...with a brilliant future...~400 sales in the next 30 years
  16. 16. …and reporting for duty!!Reporting for dutyOn time for first delivery to French Air Force
  17. 17. •Market situation and AM positioning•A400M: right aircraft at right time•A330 MRTT: only new generation tanker flying•Opportunities for our Light & Medium aircraft
  18. 18. MRTT now well established in the marketMay 2013• 5 MRTT with RAAF, 4 with RAF, 3 with RSAF and 2 withUAE (May 2013)• Selected by Indian AF• Preferred choice for French AF• 4,000 customer flight hoursA330MRTT is now THE reference in the market
  19. 19. 2013 – MRTT changes the world of AAR• Australia, Saudi Arabia, UAE and UK all conducting transport andAAR operations• 17 aircraft in service by year-end, 14 already• Vastly improved reliability and capability over previous generationPage 20
  20. 20. MiddleEastCountries with obsoletetankers, not yet replacedPotential new operatorsPotential repeat ordersMany opportunities remain outside US• Short-term potential: India, France, Qatar, Singapore, Saudi Arabia• Longer-term: Australia, EDA, South Korea, Algeria, UAE, Oman, Turkey,Canada...Potential market 90a/c(US KC-Y not considered)
  21. 21. •Market situation and AM positioning•A400M: right aircraft at right time•A330 MRTT: only new generation tanker flying•Opportunities for our Light & Medium aircraft
  22. 22. L&M aircraft growing from traditional intonew markets• Traditional markets: selling well in Latin America (Colombia, Brazilongoing), USA (USCG), Europe (Poland, Ireland)Traditional AM marketsNew markets• New markets - inroads in:• South-Saharan Africa(Cameroon; ongoing with othercountries for UN missions)• Middle East and North Africa(Egypt, Oman)• Asia (Kazakhstan; Indonesia,and more to come)
  23. 23. L&M: record in Sales and Market Sharefor the last 10 years!791727188132153223%33%42%47%48%45% 45%48% 47%51%0%10%20%30%40%50%60%0510152025303540452003 2004 2005 2006 2007 2008 2009 2010 2011 201232 a/c sold in 2012!!51% cumulative 10-y market shareC295&CN235 annual sales10-year Cumulative Market ShareFuture: to capture consistently 50-75% of the market
  24. 24. • Proven – in service worldwide with long operating history• Low risk – well-understood product with optimum technology• Cost efficient – best operating economics in class• Robust, reliable – in daily service in very tough operatingconditions• Well supported – Full In Service Support contracts further increasereliability and efficiencyWhy L&M have good prospects?May 2013
  25. 25. L&M Commercial activityChileEcuadorColombiaUSCGBrazilGhanaLesothoYemenKazakhstanBangladeshVietnamPhilippinesIndiaShort-term CampaignsLonger term marketPeruSubsaharanAfricaMexicoUKPolandSlovakiaHungarySaudi ArabiaAfghanistanNew ZealandTaiwanThailandMalaysiaIndonesiaCanadaGabonPage 26
  26. 26.  A400M is the right aircraft – strategic, tactical and a tanker A330MRTT is the clear market leader, and will prove its value infull operation with its customers during 2013So in summary… Shrinking military budgets are spreading, except for specificcountries and regions. But military and civic missions aregrowing. In this context, the most versatile aircraft have the bestchances to obtain market success. AM Light & Medium products are proven, versatile and the mostpopular choice in the market for transport and ISR Continuous Product Development will contribute to keep theleading position of C295 for many years…. And now…
  27. 27. Introducing the newMay 2013Presented byGustavo Garcia Miranda, VP Market Development
  28. 28. • Airbus Military announces the launch of the…C295W, a new C295 series with enhanced performanceMay 2013Introducing the new• Featuring….• Winglets• Enhanced engine performance mode• Providing…• Improved performance in all phases of flight
  29. 29. Why winglets?• Designed for optimizing low-speed perfo, i.e:• Take-Off from hot & high airfields• Initial flight level at high weights• Ceiling AEO and OEI / driftdownMay 2013• Small reinforcements added to the wing (+30kg)• Applicable to all C295 versions• -3/-6% improvement in overallfuel consumption• Same Type Rating as basic C295• To be included as basic featurefrom 4Q 2014 on
  30. 30. Effect of new engine Settings?• Study launched by AM with Pratt & Whitney in 2011 for improved climband ceiling performances• Approved by Pratt & Whitney, already certified and incorporated into theAircraft Flight Manual• Improves operation over very high terrain such as the Andes or theHimalaya with only minor influence on maintenance costMay 2013SCENARIO Take-Off Climb CruiseSTANDARD TOGA MCLB M.CRUISENEW TOGA TOGA MAX. CLB(*) ISA+20 at Take-Off, ISA+10 in cruisePayload at 25,000 ft increased by 1,500 Kg(strictly effect of new power settings, without winglets)
  31. 31. Performance improvementsPERFORMANCE HIGHLIGHTSCurrentC295HOT&HIGH: Payload @ 500 nm range from a6,000 ft altitude airfield ISA+206,500(kg)7,500(kg)2-engine CEILING: for 21t TOW21,000(ft)24,500(ft)PAYLOAD @ 25,000 ft Cruise ISA+10, 535 nm(Peru: LIM-IQT)3,500(kg)6,100(kg)Max ALTITUDE for max cruise speed @ 20t TOW18,000(ft)22,000(ft)Endurance: TOS @ 200nm, ISA 2,000 ft422min452minAEW @ ISA+10 7.9 hr 8.8 hrSubstantial improvement in performance for operators inHot&High environment; important fuel reduction for other
  32. 32. for ISR ApplicationsEnhanced operation for ISR missions based on C295W:• Additional time on station for surveillance, typically 30min more• Optimized altitude operation for AEW or SIGINT applications• C295 AEW increased max operational altitude from 24,000 to 26,000 ft• Nearly one hour more of mission• Improved operations from Hot& High airfields
  33. 33. Target customersMay 2013• Hot, or High, or H&H countries, or• Operators needing very long patrol times…and for any operator aiming for a verytough, versatile and economic workhorse!
  34. 34. IMPROVED PERFORMANCE INALL PHASES OF FLIGHTImproved take off (hot and highrunways), climb, flight level,payload, range and endurancein summary…WINGLETSincreased lift-to-drag ratioENHANCEDENGINEPERF. MODEmore poweravailable inclimb/cruise Hot & High: Payload increase of 1,000+ kg operating from H&H airfields Flight over high terrain: Payload increase of 2,600 kg for a given mission,and cruise at 25,000ft (ISA+10) Range increase of 200nm for a mission with payload of 4 tons (2,500nm+ vs2,300nm, +9%) ISR/surveillance missions: +30min in Time on Station -3/-6% reduction in fuel consumption (average -4%)
  35. 35. schedule• Launch of Commercial Activities May 2013• Flights for certification Early 2014• Certification completed 2Q 2014• First delivery to customer 4Q 2014May 2013
  36. 36. Thank youMay 2013