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Fuel, Insurance Prices Challenge Industry

Both insurance rates and fuel prices have peaked in 2003, although volatility in the fuel and uncertainty in the insurance industry means that relief may be short-lived.


July 18, 2007
By David Carr

Topics

Welcome to HELICOPTERS’ first business issue – a chance to shine the
spotlight on some of the economic challenges that confront operators.
Time spent on the trade show floor of last April's successful
Helicopter Association of Canada (HAC) convention and trade show
provides firsthand insight into just what those challenges are. Fuel
and insurance are at the top of the list. The cost of filling up and
underwriting a helicopter has squeezed already-tight profit margins
further. There is some good news on this front. Both insurance rates
and fuel prices have peaked in 2003, although volatility in the fuel
and uncertainty in the insurance industry means that relief may be
short-lived. As both articles point out, operators do have some options
to help keep those costs down.

A
third business topic, which was not readily apparent at HAC, but should
be of interest to operators and MROs who keep hundreds to tens of
thousands of spare parts in stock, is the invisible cost of bad parts
inventory management.

Of course, this issue of HELICOPTERS is
not entirely business. It is summer, after all, so it seemed
appropriate to include a bit of summer reading. Geoff Goodyear draws
some interesting parallels between day-to-day helicopter operations and
commercial diving. Likewise, in Big Helicopter Little Ship (page 27)
Stephane Demers provides a colourful account of the first time he
landed a Sea King on the deck of HMCS Iroquois just off the coast of
Nova Scotia.

Speaking of the Sea King – is a decision about its
replacement finally at hand? The manufacturers would appear to think
so, given the current level of activity.

Ken Pole, HELICOPTERS’
Ottawa correspondent, has been following the helicopter controversy
since it began almost 10 years ago. He travelled to Marignane, France
during the Paris Air Show to report on NHIndustries' NH90 program. His
article, including an account of the NH90's cold-weather trials in
Iqaluit, Nunavut (alongside an Airbus A340) begins on page 22. A
special MHP report is already being prepared for the next issue.

Certainly,
the political landscape on the MHP seems to have done a 180º turn. The
federal Liberals, once too embarrassed to announce a replacement for
the 40- year-old Sea King prior to an election, may now be weighing the
consequences of entering a third campaign since canceling the EH101
without a new helicopter on order. Besides, the Department of National
Defence (DND) needs to finally close the MHP file in order to launch a
new round of political dithering and posturing over a heavy-lift
transport replacement for our ageing fleet of Hercules aircraft
(already shaping up to be Son of MHP).

Finally, this issue
includes our first annual Canadian Helicopter Salary Survey. The salary
survey was first introduced in our sister publication WINGS in 1998.
Every year it harvests some fascinating data about pay scales and
benefits in the Canadian aviation industry. This survey should be no
exception since 2003 has been an interesting year for helicopter owners
and the people who fly and maintain them. I hope you will take the time
to either fill out the survey on page 30 of this issue, or click onto
the electronic version on www.helicoptersmagazine. com The results will
be published in the January/February/March 2004 flight training issue.

That is it for now; please fly safe and enjoy the rest of your summer.

 


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