|Dassault at the Paris Air Show or the European Exceptio|
Dassault at the Paris Air Show or the European Exception
Charles Edelstenne, Chairman and Chief Executive Officer of Dassault Aviation. Press conference at the Paris Airshow 2003. Le Bourget, June 14, 2003. Photos Ó Dassault Aviation and European Security.
Charles Edelstenne: Photo Joël-François Dumont (E/S)
Ladies and Gentlemen, dear friends,
First of all allow me to thank you for coming to take part in this first press conference of the Paris Airshow, and to say again how pleased I am to welcome you and meet you here.
This 45th Paris Airshow opens against a background full of uncertainty.
While the Evian G8 declared that conditions for economic recovery have been met, we must admit that the recovery has not arrived yet. The general situation is currently characterized by three phenomena: a continuing world economic crisis, a North American economy which has not yet bounced back as predicted and air transport which, after being paralyzed during the war in Iraq, has just been hit by SARS while the terrorist threat is still with us.
After the euphoria of the beginning of the new millenium, the economic situation is really no longer quite as favorable. The difficulties facing civil aviation are compounded, as far as the European industry is concerned, by the weakness of the dollar which, if not corrected, will pose a major risk in the long term.
In this context, our company did, in spite of everything, have a good year in 2002, the key facts and figures of which you will find in the annual report which will be handed out to you later with your press kit.
While we have, up to now, been able to pull through the crisis without, unlike some of our colleagues or competitors, having to lay off staff or shut down entire production lines, we owe this to our strategy of flexibility which we defined a few years ago and which we implement on a daily basis.
This flexibility will depend on the short duration of the crisis however.
Our investments in the civil sector have ensured the continuity of our company and decreased our dependence on export contracts and fluctuations in French and foreign defense budgets. We are now able to adapt our production rates to keep pace with trends in the civil market, without having to alter the company’s structures for the moment.
But, as we predicted, we are starting to feel the effects of the crisis in 2003.
Our revenue will be lower than in 2002. It is difficult for me to say today exactly how much lower, as this will depend on the level of the dollar and the number of Falcon aircraft delivered this year.
As far as civil aircraft are concerned, the rate at which orders are coming in is currently lower than that in previous years, with twenty or so Falcon jets ordered to date. Our current forecast is to deliver approximately 50 aircraft this year. Our production rates will thus vary around a basic rate of 4 per month, compared with 6 or 7 per month over the past few years, with the possibility of responding quickly to market fluctuations.
Our overall Falcon back order is over 140 aircraft.
Two further remarks concerning the civil market: the fractional ownership market, which was cause for great celebration at the time of the last Air show, is also clearly on the turndown.
No one knew how this new market would behave in a period of crisis. As it turns out, it reacts in the same way as our main market and follows fluctuations in the general economic situation.
And finally, we have seen a slight improvement in the sales of second-hand aircraft with now only ten in stock; this is perhaps a sign of recovery in the market.
Bruno Revellin Falcoz, Charles Edelstenne and Loïk Segalen (E/S)
In regards to the Falcon programs, the development of the Falcon 7X, the first model of a highly innovative generation of new business aircraft, is continuing at the planned rate.
With entirely new aerodynamics, it will be fitted with an EASy cockpit and electrical flight controls. Its technical progress can also be seen in its design and production processes, which are 100% digital.
The physical platform brought together up to 400 people, including 170 colleagues from 20 companies worldwide, to take part in its development. These engineers gradually returned to their respective companies to work on a virtual platform, through the use of a single, dedicated information system. Our company retains oversight at all times. This represents a world first in the industry as a whole.
The first components of the fuselage nose section and wing as well as the first equipment are now in production and can be seen in the photographs on the CD-Rom included with our press file.
The maiden flight is scheduled for spring 2005 and certification and first deliveries are due by the end of 2006.
Having celebrated the 40th birthday of the Falcon Family last month in Bordeaux, and then in EBACE in Geneva, it is particularly satisfying now to watch the new generation 7X launching the next 40 years of Falcon.
As far as our current programs are concerned, the Falcon 2000EX obtained joint FAA and JAA certification on March 21 of this year and the first deliveries took place in May.
The Falcon 2000EX EASy made its first flight on January 28 of this year and the first deliveries are due to take place in the first quarter of 2004.
In regards to the Falcon 900EX EASy, the first aircraft will be delivered to customers starting at the end of this year.
The Falcon 2000EX: François Robineau Photo Ó Dassault Aviaplans
And finally, in order to be able to provide an ever-better industrial response to the needs of the market, we are set to inaugurate the new 21,000 m² Falcon building in Bordeaux in September, as planned. The Falcon 7X will be assembled in this building.
In regards to the military sector, the war in Iraq does not seem to have significantly modified the general context. However the US’s renewed determination to assert its power may change the hand dealt in certain markets, which are more sensitive to politics than civil markets.
To date, however, there are really no new factors in the prospects for these markets which, even if our company does not depend on them exclusively any more, are still essential.
Serge Dassault during the press conference (E/S Photo)
Indeed, Dassault Aviation is one of the three or four remaining companies worldwide able to design and produce a new generation of manned or unmanned combat aircraft systems.
In France, the Navy's Rafale aircraft have begun to demonstrate all their operational capabilities. We are in the process of finalizing discussions with the government concerning the new fleet of 59 Rafale aircraft, with associated in-service support. This will bring the number of Rafale ordered by France to 120 out of a total of 294.
The Rafale M1: Véronique Almansa Photo Ó Dassault Aviation
From a technical standpoint, development work is proceeding well and the new military programming law has finally stabilized this program which is essential for our country.
In addition, Dassault Aviation has been selected as prime contractor for the simulation program for the development of a complex pilot training system for the French Air Force and Naval Aviation.
Two simulation centers will be brought into operational service between 2006 and 2007:
- the first in Saint-Dizier for the Air Force,
- the second in Landivisiau for Naval Aviation.
Each center, including 4 simulators, will be outfitted with sophisticated facilities implementing advanced technologies.
- With regards to our export marketing strategy
In view of the promises of the F-35 and the Eurofighter/Typhoon’s technical problems, we propose as standard the French version of the Rafale F3 (fully omnirole standard) and, as part of industrial and government partnerships, the development of all future functionalities.
The first Mirage 2000-9, out of the 32 new aircraft ordered by the UAE, have begun to be delivered. In addition, the first of 30 aircraft retrofitted on-site made its first flight at the beginning of this month.
The Mirage 2000-9: François Robineau Photo Ó Dassault / Aviaplans
The other orders, for India and Greece, are being manufactured.
Our prospecting work is continuing for this aircraft which still has a good future ahead of it.
In the training field, and pending the Eurotraining program getting underway in earnest, we plan to propose an improved version of the Alpha Jet, called Alpha Jet Mk1, which includes new technologies, so as to give to this aircraft the future which it still deserves.
In the future, as a major player in defense aviation, our company intends to be present in the field of unmanned aircraft systems. Dassault's expertise, gained through fifty years of development and production of combat aircraft, naturally bestows it with a major role in this new field of development in worldwide aviation, in particular in terms of UCAVs which it considers, in the long term, as a complement to the Rafale class of combat aircraft.
The UCAV Demonstrator: Ó Dassault Aviation Picture
For this purpose, it has devised an expertise development logic based on demonstrators:
The Petit Duc Ó Dassault Aviation PhotoA 2nd version of the Petit Duc has just flown and represents a major milestone in terms of aerodynamics and stealth; The Moyen Duc is due to fly at the beginning of 2004.
On the strength of this initiative, we want to be present:
-- In the MCMM, a tactical drone program for the French Army. For this purpose, we have set up, in partnership with Sagem, a joint company called Dassault Sagem Tactical UAV, which is responsible for the development and marketing of a tactical drone system based on Sagem’s Sperwer LE and Dassault’s fast/slow project, implemented on the basis of the Sperwer ground segment. This company is open to European co-operation.
-- Iin the European MALE program, initiated by the French air force in co-operation with the Dutch air force and open to other European armies. There again, our company will combine its expertise with that of other European companies with experience in this field.
Multirole Tactical UAV System: Ó Dassault Aviation Picture
In addition, the United States has already initiated several developments in the UCAV, or unmanned combat aircraft, field and it is, in our opinion, important for France to take initiatives quickly.
Indeed, the research and development work undertaken in this field is essential to maintaining the expertise of our design offices at their highest level.
And finally, it would not be possible to talk of the future of our products without mentioning the range of associated services demanded by our customers, which are ever more comprehensive and effective. Our efforts and results in this field are now recognized, in both the military and civil fields.
The military support system provides, in this respect, a range of products and services required to increase the reliability of our aircraft and maximize their operational availability.
From fault diagnosis, including the training of crews and technical teams, to logistic circuits and mission preparation systems, military support is what keeps our aircraft flying.
The Mirage 2000-5 MK2: François Robineau Photo Ó Dassault / Aviaplans
Having seen service in many theatres of operation, the Mirage 2000 has become a world standard in terms of availability, reliability and ease of use, in particular through an automatic, fully-integrated testability system.
Moreover, its interoperability with NATO aircraft and its combat effectiveness were demonstrated during the Gulf war and the wars in Bosnia, Kosovo and Afghanistan, with record rates of operational availability.
The Rafale, of course, benefits from the operational experience of the Mirage 2000.
As regards civil aircraft, improvement in customer service is a priority. Our efforts have been focused on everything that can help our customers use their aircraft effectively.
The continued globalization of the spares activity, with the appointment of a worldwide director, has significantly improved worldwide service.
Ladies and gentlemen, and dear friends, I would like to say again that the industry in general, and our industry in particular, is never about easy sailing. It does not ride along constantly on the crest of a wave and must be able to confront periods of ebb and flow. This is what we are striving to do, while calmly and confidently waiting for the better days that we are all hoping for.
I thank you for your attention and will gladly answer any questions you may have, before inviting you to share our buffet.