When it comes to military MRO, the business can be worth nearly as much than the original acquisition contract even more if the aircraft platform stays in service for a long time (all the mainteance hours over the life of the platform together with financial injections for capability upgrades. Often the platform can have its out-of-service date extended if a replacement capability is found difficult to squeeze into already restricted national defence budgets.
The replacement for the German Air Force “Schwerer Transporthubschrauber” (STH) Sikorsky CH-53 Super Stallion heavy helicopter is such a case. In the early 1970s, German Army Aviation (who until 2013 owned and operated the CH-53s) received two pre-production CH-53Gs which were manufactured by Sikorsky in the United States, followed by 110 CH-53Gs manufactured under license by VFW-Fokker ( Vereinigte Flugtechnische Werke) at Speyer, Germany. VFW was taken over by Messerschmitt-Bölkow-Blohm (MBB) in 1981, which was itself bought by Deutsche Aerospace in 1989 (which is now part of the Airbus Group).
Most of the German CH-53G/GS/GE/GA fleet have now been flying for well over 40 years and are in need of replacement. Of that inital fleet there are currently around 60 helicopters (down from 80 a few years ago) that are being used by the German military on a regular basis (and the budget is there to fly and maintain them).
Through the legacy of German production, Airbus has won the last three modernisation contracts for varying numbers of the overall CH-53 fleet. In 2002, Airbus upgraded 38 CH-53Gs to CH-53GS (Special) at a cost of around worth around €23 million, an order placed by the Federal Office for Defence Technology and Procurement (BWB) which was completed by the end of 2005.
In 2012, Airbus modernised 40 Super Stallions to CH-53GAs to include new avionics and communications systems. The German armed forces wanted its new NH-90 transport helicopters and Tiger attack helicopters to be able to work in concert above the battlefield. Airbus of course produced both of the other helicopters, the former alongside other industry partners.
In February this year Airbus received another €135 milliondirective from the Federal Office of Bundeswehr Equipment, Information Technology and In-Service Support (BAAINBw) described as an obsolescence management contract to retrofit 26 CH-53s (20 CH-53GS and six CH-53GE) with new components and up-to-date parts. This contract will ensure that as a new heicopter type enters service around a planned date of 2023, there will be enough heavy lifters around to during the delivery period and volume capability is retained while the older, first modified CH-53s are taken out of service.
The main players for the CH-53 replacement are the original manufacturer, Sikorsky, with its brand new CH-53K. It is not yet in service but any German order could be slotted into the U.S. Marine Corps production line for deliveries to begin around 2022. The rival is Boeing’s latest version of its iconic Chinook, the CH-47F. This is available and in service. However, both American companies are concerned about two things at least: numbers of aircraft ordered and who gets to conduct the MRO on them. If the German government defaults to Airbus, then the unit cost for either aircraft will escalate sharply as the OEM would have little prospect on making a volume of money post-delivery, except for spares supply.
Wolfgang Schoder, CEO of Airbus Helicopters Germany, recently heavily underlined the historical role that his Military Support Centre in Donauwörth has played in supporting the CH-53s: “Airbus Helicopters has been the German specialist for maintaining, repairing and modernising heavy transport helicopters for decades. We have the necessary infrastructure, highly trained professionals and can guarantee supply for all Bundeswehr models.”
The German government is now faced by its own aerospace industry wanting a special deal, while both foreign OEMs will play hard-ball on the price if they aren’t offered any of the OEM pie. The request for proposals is expected to be issued mid-2018 with a contract award in 2019.