Thursday, May 19, 2016

An act of survival: Bell Helicopter relocating its 505 Jet Ranger X assembly to Canada

Less than a year after opening its 82,300-square-foot manufacturing facility, Bell Helicopter is changing which products it will build in Lafayette.

In a conference call Thursday afternoon, the company president and CEO Mitch Snyder said Bell is relocating several programs across the United States as it deals with a downturn in the commercial market.

"The 505 Jet Ranger X manufacturing facility in Lafayette, Louisiana, will relocate to our Maribel manufacturing and distribution facility in Canada, "Snyder said. "We remain committed to our Lafayette employees in the state of Louisiana. Therefore the Lafayette facility will receive the Bell 525 Relentless cabin sub-assembly, relocating from Amarillo."

The company will also relocate its Grumman MQ-8C aerial vehicle-manufacturing facility from Ozark, Alabama, into the Lafayette Assembly Center, he said.

The state funded the $26.3 million construction of assembly center, which opened in August. The building is owned by the Lafayette Regional Airport. Bell has been leasing the facility and committed to making an additional $11.5 million capital investment in equipment and tooling.

On Thursday, Snyder said the company is negotiating with officials to ensure that Bell Helicopter is keeping its end of the bargain with state and local governments.

“We are sitting down with the economic group right now and going through that," he said.

When the assembly center opened in August, former Gov. Bobby Jindal, who was on the presidential campaign trail at the time, praised Bell's move to Lafayette in 2015 as "a new era in Louisiana’s rich history in aerospace."

But there were signs of trouble months before the local assembly center's opening. In April, 2015, the company announced plans to lay off more than 1,000 employees. Shortly after the announcement, Bell Helicopter spokeswoman Ashleigh Dana Told The Daily Advertiser that the company was invested in the Lafayette assembly center with more than 300 orders for the 505 Jet Ranger X models.

The 505 Jet Ranger X final assembly facility also promised to deliver 115 new local jobs.

Snyder said there are 27 employees at the facility who now will be part of the transition process to move the 505 Jet Ranger X assembly to Canada and move the Texas and Alabama operations to Lafayette.

After the transition, the company will assess its staffing in Lafayette, Snyder said.

"We don't know yet at this point. We are still looking at the numbers," he said.

Snyder said Thursday that the 505 Jet Ranger X manufacturing operation will not be returning to Lafayette.

The commercial aviation industry has taken massive economic blows for three consecutive years, Snyder said. The decision to shift the company's facilities is an act of survival.

“It’s worldwide; it’s industry-wide," he said. "We’ve said it numerous times  from 2013 to 2015 it was down by about 50 percent. From 2015 to now, it’s worse."

Original article can be found here:

Bell Helicopter said Thursday it would assemble its 505 Jet Ranger X in Mirabel, Canada, and abandon plans to build the new-model aircraft at a $26.3 million Lafayette facility that Louisiana financed to lure the company and 115 jobs.

Instead, an undetermined number of employees at the Lafayette plant will handle some of the cabin assembly for Bell’s 505 Relentless helicopter, work that is being transferred from a plant in Amarillo, Texas, Bell CEO and President Mitch Snyder said in a conference call Thursday.

Snyder said the Lafayette plant also will handle modifications to the Northrop Gruman MQ-8C Fire Scout unmanned aerial vehicle, a Bell project that is being moved from the company’s facility in Ozark, Alabama.

Snyder said the company’s decision to change directions was driven by a severe downturn worldwide in the demand for commercial aircraft.

The company has 27 employees in Lafayette, most of them hired since the facility was completed in August. Those workers will help transition the projects. Snyder said the ultimate number of workers hired in Lafayette will depend on the company’s labor needs, which will be determined later.

Snyder would not estimate how many workers will be hired or if it would approach the 115 figure Bell and Louisiana officials cited a few years ago. “We don’t know a number at this point,” he said and added that Bell is “dedicated to making a strong presence in the ares.”

Former Gov. Bobby Jindal led an entourage of state, local and Bell officials in announcing that Bell would locate the Jet Ranger 505 X assembly plant on 14.5 acres at Lafayette Regional Airport. State money paid for the $26.3 million hangar, then the state handed ownership of the hangar to the Lafayette Airport Commission, which leases the 83,000-square-foot building to Bell.

The state also offered incentives, such as performance-based grants of $4 million for lease support, $200,000 for relocation expenses and $3.8 million for infrastructure improvements.

In return, Bell said it would invest $11.4 million in equipment and tools and would hire 115 employees.

Louisiana officials Thursday sought out the positive parts of Bell’s decision.

“We are very pleased the work for the Bell 525 and the MQ-8C Fire Scout is moving to the Lafayette facility,” Gov. John Bel Edwards said in a statement released by Bell. “Bell Helicopter has played a significant role in boosting the Lafayette economy and they have proven themselves to be valuable partners in Louisiana.”

Lafayette Mayor-President Joel Robideaux, who was out of state Thursday, was quoted in the same Bell news release as saying that, “We are fully invested in the partnership we’ve created and look for great things for our community, the company and Bell Helicopter employees.”

Gregg Gothreaux, head of the Lafayette Economic Development Authority, said Thursday the news could be worse.

“What we care about is the jobs,” he said. “We knew of Bell’s struggles for sales this year. We knew that times were tenuous. We were very excited when we found out they (Bell) were going to protect the Lafayette location.”

Bell continues to conduct tests and certify its 505 Jet Ranger X.

The news about Bell changing its plans comes after the company officials, including Lafayette manager Paul Watts, said in late March that the plant’s assembly operations and hiring remained on schedule. They said then that full production of 200 Jet Ranger 505s a year would commence in 2017.

The news that was released Thursday was welcomed in Canada, where final assembly of the chopper will now be done in Mirabel, near Montreal in Quebec.

“Today’s announcement is a good news story of jobs and future growth in the Canadian aerospace sector and of an innovative R&D legacy that will last far beyond the manufacture of this helicopter,” Navdeep Bains, Canada minister of innovation, science and economic development, said in the Bell statement.

Bell Helicopter is a subsidiary of Textron.

Original article can be found here:

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.