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GKN SET TO EXPAND HELICOPTER SALES IN US

20 Dec 02. The FT reported that, GKN, the UK engineering group, is to make a big effort to expand its military helicopter business in the US, according to Kevin Smith, who takes over as chief executive on January 1.

In an interview with the Financial Times, Mr Smith, currently head of GKN’s aerospace division, said he hoped helicopter sales in the US, as a proportion of the company’s total helicopter revenues, would rise from less than 5 to 25 per cent within five years.

Mr Smith joined GKN three years ago from BAE Systems. He is taking over the top job from Marcus Beresford, who is retiring. GKN’s helicopter operations, which it runs as a 50-50 joint venture with Finmeccanica of Italy, are part of AgustaWestland, the world’s biggest maker. In 2002, AgustaWestland’s sales are estimated at about $2.5bn (£1.6bn). AgustaWestland has teamed up with Lockheed Martin, the US defence contractor, to bid for four military helicopter contracts in the US in the next few years.

In each case, Lockheed would be the main contractor, but most of the helicopter technology would come from Europe. The bids would be based around AgustaWestland’s EH-101 helicopter, which GKN says is more modern than some competing US designs. The first bid is for a prestigious contract worth an estimated $400m to supply 20 helicopters for the use of the US president andtop-level staff. The helicopters would be flown around the world in military transporters, and capable of being used in emergencies. The bid will go to the Pentagon in 2003. It is the first time GKN has been represented in a tender for a sizeable order for US military helicopters.

Mr Smith said he thought the GKN team had a “very good chance” of winning the contract. However, it faces stiff competition from at least two other US helicopter makers: Sikorsky, part of the United Technologies conglomerate, and Boeing, the world’s biggest aerospace company.

Mr Smith said GKN would be represented, through the Agusta- Westland/Lockheed Martin partnership, in three other bids, including a contract for a fleet of about 130 helicopters to be used by the US Air Force to rescue stranded pilots.

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