Sikorsky President Outlines Plan to Improve Company Operations




Sikorsky President Outlines Plan to Improve
Company Operations

STRATFORD, Conn., April 14, 2000 -- Sikorsky President Dean C. Borgman today outlined a plan to improve company operations and take advantage of growing opportunities in the worldwide helicopter market. Borgman made the presentation to company employees in a series of briefings at the Stratford plant and satellite facilities. "Your hard work is paying off," he told the workforce. "We must continue to work toward our goals to ensure a great future at Sikorsky. The future is tremendous and it’s ours to take."

The company has already taken many hard, necessary steps to make Sikorsky more competitive and the transformation must continue, Borgman said. The company is poised to rebound from a worldwide industry slump with the introduction of several new products aimed at the domestic and international market coupled with the start-up of several key U.S. government programs in the next few years. The U.S. Army Aviation Modernization plan, which was released to Congress April 1, bodes well for Sikorsky's future.


The plan cites the RAH-66 Comanche as the linchpin to Army aviation modernization efforts and calls for acquisition of more than 1,200 aircraft through 2024. "The Army remains completely committed to COMANCHE," the mod plan notes. The mod plan also cites the UH-60 BLACK HAWK as the foundation of the Army's utility force. It calls for procurement of 323 new BLACK HAWK helicopters. Additionally, the plan notes that modernization of the BLACK HAWK "is the cornerstone to long-term utility fleet sustainment" and asks for the upgrade of 60 BLACK Hawks per year to the L+ configuration. These modernization and upgrades will wash across the product line and potentially could be leveraged in the future to make sales internationally. Borgman charted the changes in the helicopter industry over the past several years and the impact they have had on Sikorsky. In 1992, there was clearly overcapacity in the industry. Since then, the number of major helicopter companies worldwide has reduced from eight to five. Internally, Sikorsky reacted to this downturn by putting in place a restructuring program in 1999 that closed unnecessary facilities and eliminated positions to lower costs and improve competitiveness.

Borgman pointed out that the company's customer base has shifted. U.S. government orders have declined but the number of international customers is on the increase. The company is re-designing processes across the board so that it can serve a greater variety of customers, build aircraft faster, and react more quickly to changes in the world marketplace. Sikorsky's S-92 is receiving great interest and will be entered into several international competitions, including the Canadian and Nordic proposals. The S-92 received its first order from Cougar Helicopters of Canada, an offshore oil operator, and deliveries will begin in 2002. The improvements developed on S-92 will also be incorporated into the UH-60X, the Army's next-generation BLACK HAWK. The S-76 remains the finest aircraft in its class and Sikorsky is taking steps to make it more price competitive on the international market. Step one is to transform the program more along the lines of S-92 with greater teaming arrangements. Last week, Sikorsky announced that Keystone Helicopters will perform S-76 completion work. By reducing costs, Sikorsky will acquire the margins needed to make product improvements in the S-76.

Borgman also outlined Sikorsky's strategy to gather a greater share of the customer service market. Borgman pointed out that the customer service market, which involves the sale of spare parts, technical assistance and other services, is larger than the market for new aircraft. Sikorsky Aircraft Corporation, based in Stratford, Conn., is a world leader in helicopter design and manufacturing. United Technologies Corp., based in Hartford, Conn., provides a broad range of high technology products and support services to the building systems and aerospace industries.

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