Flush with new contracts for its light tactical military vehicles, Oshkosh rocketed to the top of its peer group for companies with revenues of $5-20 billion, unseating two-time winner Precision Castparts. A surge in production of Mine-Resistant Ambush-Protected (MRAP) all terrain vehicles helped drive a 579% increase in operating profit in fiscal 2010. But revenues and profits have begun to decline as production rates turn down, and TPC analysts are questioning whether Oshkosh will be a one-year wonder.
Operations and supply chain appear to be the new focus at Cessna Aircraft as Scott Ernest takes the helm of the Wichita airframer. Textron Chairman and CEO Scott Donnelly tapped his former veteran colleague at GE Aviation to succeed Jack Pelton as chairman, president and CEO of Cessna. Textron's May 2 announcement of Pelton's departure followed Cessna's “disappointing” first-quarter results that Donnelly attributed to operational problems, including growing production costs for the CJ4 business jet.
A disastrous foray into a satellite telephone venture sent Loral into Chapter 11 bankruptcy protection for more than two years, and the company emerged in late 2005 as a poor TPC performer. But the fortunes of the satellite manufacturer and services provider have improved greatly during the past two years, as evidenced by its second-place TPC finish. Operating income nearly quadrupled in 2010 on a 16% increase in sales, and the company ended the year free of debt.
Whether you call the best engineering development culture “hacker's spirit,” entrepreneurship or chutzpah, the ability to rapidly and pragmatically improvise is inherent. Zahid Hasan's recent Viewpoint, “Aerospace Should Embrace The Hacking Spirit” (AW&ST May 16, p. 66), correctly points out the need for this culture to be nurtured if technology companies are to succeed.
When the aerospace and defense industry entered 2011, executives could look back on the prior year and generally feel pretty good about how the sector did overall. Revenues were up modestly but still reached a new high, and profits were substantially greater.
Is Boeing finally entering calmer waters? A year ago, hefty charges on the Boeing 787 and 747-8 development programs led to a seventh-place TPC finish among the 10 companies with revenues greater than $20 billion. But this year, Boeing ranked third, as operating profit rose to 7.6% from 3% in 2009.
Carole Coune has been selected to succeed Jack Short as secretary general of the Paris-based International Transport Forum. She was president of the management board of the Belgian Ministry of Transport.
Ed Sims has been named chief executive officer of Airways Corp. of New Zealand in Wellington. He succeeds Ashley Smout, who resigned earlier this year. Sims was group general manager for Air New Zealand.
Buckner Hightower (see photo) has been appointed chief executive officer of Excalibur Almaz USA of Houston. He was executive vice president for five years and had worked with aerospace organizations in the Soviet Union and the Russian Federation since 1988.
Michael J. Hirschberg has been named executive director of the American Helicopter Society International, Alexandria, Va. He was principal aerospace engineer at Centra Technology, providing technical, program and management consulting to the Defense Advanced Research Projects Agency.
The books are closed now and it is clear that core performance in aerospace & defense (A&D) was flat again for the second year in a row, which was good compared with other industries. Revenues stayed essentially the same and barely kept pace with inflation. Earnings were up on its face, but core earnings were level to slightly up if you add back the $10.5 billion of one-time charges in 2009 and $1.7 billion of one-time charges in 2010 associated with over-budget development programs, among other unusual items.
It's not easy to finish first among a group of formidable competitors—let alone four times running. Yet that is what Lockheed Martin managed to accomplish in the largest-companies grouping in Aviation Week's 16th annual Top-Performing Companies (TPC) study, outpacing second-ranked General Dynamics and third-place Boeing. Oshkosh Corp. captured the top honor for companies with revenues of $5-20 billion, while Cubic took the crown for companies with revenues of $1-5 billion.
Aerospace & Defense (A&D) companies achieved strong revenue and operating profit in 2010, resulting in a rebound in Top-Performing Companies (TPC) scores, nearing historical highs. Although defense budget cuts are looming, military spending for 2010 was in line with prior years and commercial aerospace was generally stronger. However, operating profit was up significantly over the prior year, primarily due to better program performance.
Dassault is proof that large business jets have fared much better in business aviation's painful downturn. The new, top-of-the-line Dassault 7X helped the French jet builder achieve record deliveries in 2010. Operating margins reached 13.7% and revenues rose 17% to $5.6 billion, enough for a fourth-place TPC finish among companies with revenues of $5-20 billion. “They're not ranked fourth by accident,” says TPC adviser Tom Captain.
The space shuttle Atlantis is waiting at Kennedy Space Center's Launch Complex 39A for the final flight of the shuttle era, rolled into place within an hour after its sister ship Endeavour returned to Earth from orbit at the nearby shuttle landing strip for the last time.
Travis Christ has joined Westlake Village, Calif.-based Row 44 as chief sales and airline business development officer. He was president of the Americas Div. of Travelport.
Claude Chidiac (see photo) has joined Montreal-based Esterline CMC Electronics as vice president of customer support and strategic development. He was vice president of business development for business aviation at StandardAero, based in Arizona.
Buried in the middle of the TPC rankings of companies with revenues of $1-5 billion, Allegheny Technologies is one to watch. Few companies track the ups and downs of the commercial airframe manufacturing industry as closely as this supplier of specialty metals. Allegheny's role as a titanium supplier for Boeing's 787 should finally pay off as deliveries of the long-delayed jet commence. The company also will benefit from increased production of other aircraft by Boeing and Airbus.
The Transportation Department is stripping away certain privacy protections offered to business jet operations. Under a rule quietly announced at 5 p.m. before the Memorial Day weekend, the department is limiting the Block Aircraft Registration Request (BARR) program, which permits aircraft owners to request that their tail number be withheld from online flight-tracking programs. Effective in early August, only operators with a verifiable security threat will be able to keep their birds off the trackers.
The results are in from Aviation Week's 16th annual Top-Performing Companies (TPC) study. Lockheed Martin CEO Robert J. Stevens has been instrumental in the company's transformation from laggard to four-time TPC winner. But the company, like other defense contractors, will be challenged to maintain its performance in a leaner and less forgiving defense environment. This year's TPC report includes tables of the rankings of 55 publicly traded aerospace and defense companies worldwide, breakouts on individual companies and—for the first time—business segment winners.
Relativity Capital purchased Evergreen Maintenance Center, an aircraft storage and maintenance facility in Marana, Ariz., on May 27 for an undisclosed sum from Evergreen International Aviation. This is the first solid aftermarket play for the private equity company. Management and staff are expected to remain.
What is the No. 1 worry facing the air cargo industry? A possible U.S. ban on the carriage of lithium-ion batteries in the belly of passenger airlines is still considered the chief regulatory concern because of the huge ripple effect it would have on the entire airline industry. But a less-known proposed rule by the Transportation Department's Federal Motor Carrier Safety Administration should be watched as well, says David Ross, principal at the logistics firm Stifel Nicolaus.
