The Twin Otter flies again
From Monday’s Globe and Mail
March 10, 2008 at 3:10 AM EDT
As David Curtis chatted at the Singapore Airshow last month, he was surprised that some foreign delegates didn’t link Canada with Mounties, moose and maple syrup.
The Viking Air Ltd. chief executive officer finally made the aviation executives take notice of Canada when he began touting the return of the fabled Twin Otter plane, 20 years after manufacturing was halted.
In just mentioning the name Twin Otter, Mr. Curtis gained respect for Canada and crucial credibility for Victoria-based Viking, which holds the rights to restart production of the turboprop.
Viking is owned by Westerkirk Capital Inc., a private equity firm that invests on behalf of the family of Victoria’s Sherry Brydson, who is the niece of the late billionaire Ken Thomson.
The first new-generation Twin Otters will fly next spring. Parts are made in Victoria and the aircraft is assembled in Calgary. (Ur-Energy)
Mr. Curtis left the Singapore Airshow, Asia’s largest aerospace convention, with a stack of business cards from prospective buyers of the 19-seat Twin Otter.
Keen interest for the rugged, twin-engine bush plane came from airlines and governments in Southeast Asia, Africa, India and the Middle East.
In hard-to-reach regions around the globe, the Twin Otter is Canada’s best-known export, Mr. Curtis said in an interview from Viking’s head office and plant near Victoria International Airport.
Mr. Curtis has secured more than 40 firm orders for the rebirth. Trans Maldivian Airways in the Maldives which already has 16 original Twin Otters in its fleet has ordered five of the new planes, formally called the DHC-6 Twin Otter, Series 400.
Others on the order list include Loch Ard Otters LLC of Florida, Air Seychelles of Africa, Air Moorea of Tahiti and the U.S. Army’s Golden Knights parachute team.
In the grand scheme of aerospace, the Twin Otter is in a fairly small market. But we love this niche. It’s a great product and it’s our plan to fill the niche, Mr. Curtis said.
The Victoria plant is gearing up to make Twin Otter components, adding 100 workers over the past year to bring its payroll to 265 people. Final assembly of the plane will be in Calgary, where there are now six employees, but will ramp up to 75 people within a year. The plane’s engines will be supplied by Pratt & Whitney Canada Corp.'s plant in Lethbridge, Alta.
Viking will be producing an updated Twin Otter prototype this spring with a more powerful engine and lighter composite materials than the first-generation model, but for the most part, the original design remains intact.
Mr. Curtis reckons that the Twin Otter will sell like hotcakes, at $3.5-million to $4-million each, depending on the specifications.
A study commissioned by Viking suggested that there’s worldwide demand for 440 Twin Otters over the next decade. But Mr. Curtis plans to restrict production to a lower, manageable level of almost 200 planes over a 10-year span, given the shortage of skilled staff and the long lead time it takes to train new employees.
The first order of the new-generation plane has been spoken for, to be delivered in the spring of 2009 to Switzerland’s Zimex Aviation Ltd., which specializes in flying in North Africa and the Middle East. After that, seven or eight Twin Otters will be built in the rest of 2009, followed by a dozen in 2010 and 18 planes in 2011.
Viking is zeroing in on a niche market for versatile small planes too small to catch the fancy of Montreal-based Bombardier Inc., Boeing Co. of Chicago and European-based Airbus SAS, which devote their energy to building large jets that sell for at least $50-million each.
Boeing shut down Twin Otter production in 1988, just two years after buying de Havilland from the Canadian government. In 1992, Bombardier bought de Havilland from Boeing, inheriting the type certificates for the Twin Otter and other de Havilland planes such as the iconic Beaver.
Those certificates which clear the way for the manufacture and sale of planes would still likely be gathering dust at Bombardier were it not for Toronto-based Westerkirk’s decision in 2003 to buy Viking, a long-time supplier of spare parts for de Havilland planes.
Mr. Curtis and Westerkirk president James Lawson patiently negotiated with Bombardier, and in 2006, Viking acquired the certificates.
My ego tells me that Bombardier missed an opportunity, but the reality is that the Twin Otter was too small a market for them, Mr. Curtis said.
In India, where the original Twin Otter isn’t even flown because of restrictions on importing planes older than 15 years, Viking is fielding unexpected inquiries. Mr. Curtis met recently with aviation officials in Delhi, Bangalore and Mumbai, and he’s optimistic of orders from India. But first, India must set rules for seaplanes the Twin Otter can be fitted with floats, wheels or even skis.
While it could be another five or 10 years away, Mr. Curtis envisages India as a potential site for a second assembly site, to complement the Canadian manufacturing operations.
He acknowledges the challenges of cracking the Indian market, but figures that if either a substantial portion of components come from India’s aerospace sector or if final assembly is located on the subcontinent, then Viking stands a better chance of winning government approval for Indian airlines to place orders.
By contrast, he doesn’t hold out much hope for sales in China, since the Chinese already produce a competing plane, the Harbin Y-12.
The Twin Otter, however, is the favourite for many buyers because of the plane’s impressive production run at de Havilland and because so many are still workhorses