HI Uplift: Heli help for a planet ‘literally on fire’. (Shame about rates) 

A firefighting helicoper, an S-70i FIREHAWK, operated by the California Department of Forestry and Fire Protection (CAL FIRE). (Photo credit: Photo United Rotorcraft).

Demand for firefighting helicopters has never been greater. Both the number and intensity of wildfires worldwide is fuelling the need for more aerial support – both rotary wing and fixed wing. The trouble is that prices and terms of many rotary firefighting contracts are too low to justify investment, according to the panel dedicated to the topic at our recent Helicopter Investor conference.

Let’s start with demand. When António Guterres, secretary-general, United Nations warned the planet is “literally on fire”, he wasn’t speaking exclusively about wildfires. But he might have been. What were separate seasons in the Northern and Southern Hemisphere – enabling assets to relocate between the two – have now merged, says Jason Diniz, president of lessor Eagle Copters.

“We are now seeing firefighting seasons that exist way past previous timelines to the point where you can’t really move assets between the Northern and Southern hemispheres,” he said. “It’s now a 365-day fire season and that’s caused a lot of issues. It’s squeezed the supply of aircraft and the reality of the matter is we just don’t have enough assets on board.”

‘Larger, more frequent and more intense’

Support came from Kate Grammer, regional business development lead, FIREHAWK and Advanced Concepts, Sikorsky. “It’s obvious to most of us that fires have become larger, more frequent and more intense and we are seeing demand correlate with that directly,” she said. “We might not see assets put into action as quickly as we would like.”

There’s no doubting demand for firefighting helicopters is rising rapidly and supply is tightening. But contract terms are braking investment, according to our panellists. The size of the problem was described by Fred Goig, consultant to Aero Asset. “When you launch a tender in Spain for 45 aircraft and nobody answers – that’s a sign,” said Goig who is also senior adviser in Europe for Conair Aerial Fire Fighting and Nova Capital. Contract prices are still quite depressed in Europe leading to very low profitability, he said.

Diniz, at Eagle Copters, agreed. “Firefighting rates have been extremely low compared with mission profiles,” he said. “That has put a massive crunch in terms of operators achieving sustainable profitability. They have to claw every cent and dollar to keep running their organisation. That’s not a healthy situation for the end user, the operator, or lessors like us.”

But there is optimism about the length of contracts. Many are offered annually with yearly renewal. Recently though, reflecting the demand supply imbalance, state agencies are starting to offer five-year contracts. “It’s not happening across the globe,” said Diniz. “But it is happening in areas where they really need [firefighting] assets like Spain and the US.”

‘It’s not working’

Some contracts in North America are extending to seven, 10 and even 15 years, according to Goig, representing Aero Asset. While the length of contracts may be improving, rates still give cause for concern. “We see contract tenders launched in Europe for heavy helicopters with a capped budget of [€] 5,000 a day and [€] 2,000 per hour,” he said. “It’s not working.”

Goig called for rate increases of 50% or more to generate sustainable profits for helicopter operators to thrive not just survive in the market. Diniz said it was hard to identify just one rate increase, as his company leased helicopters for firefighting missions worldwide. “I would say anywhere from 20% to 40% at least, depending on the cost of operations in those centres,” he added.

It’s not just contract lengths and rates that are key to the success of the sector. “In addition to rates, the ecosystem needs a supply source of parts and components to operate profitably – that is a massive issue,” said Diniz. “The combination of the two is what’s going get things to stabilised.”

Turning to helicopter types, Diniz reports seeing a lot more heavies come into the picture – prior it was lights and mediums that were the sustainable fleet. “It’s been a welcome change to have heavies. The problem is how do you keep flying at a cost basis that makes sense.”

Secondary or tertiary working lives

Common types in the Eagle Copters fleet include Bell 212s and Bell 412. Helicopters are typically in their secondary or tertiary working lives, with ages anywhere between 15 to 30 years.

Goig, representing Aero Asset, welcomed the arrival of H225 in firefighting roles in Europe and some Blackhawks. Staying with Sikorsky helicopters, Grammer highlighted the benefits of new aircraft such as the S-70 FIREHAWK.

The new generation S-70is can be quickly reconfigured in flight for search and rescue (SAR), hoist rescues and medical transport, even with its 1,000-gallon (3,785 litres) external water tank still attached, said Grammer. Greater fuel efficiency, duration and engine power plus 4g manoeuvrability when fully loaded make the aircraft a versatile firefighting machine, according to the manufacturer.

Effective aerial firefighting relied on the use of both fixed-wing aircraft and helicopters, panellists agreed. Grammer highlighted the role of fixed-wing aircraft in laying down fire lines. But helicopters offered greater flexibility, she added. They can drop water and fire retardant as well as transport firefighting troops and supply missions without the need for frequent returns to base, she said.

‘When seconds are important’

For example, a heavy lift helicopter can fill a 1,000-gallon water tank from a lake in about 45 seconds. “That capability matters, when seconds are important, whereas fixed-wing aircraft have to return to base to reload,” she said.

Highlighting the flexibility of helicopters, Grammer quoted the aviation pioneer who gave his name to her employer, Igor Sikorsky: “If a person is in peril, a fixed-wing aircraft can drop flowers, but a helicopter can save your life.”

The Helicopter Investor London 2024 conference was staged last month at the Landmark Hotel London. Full details of topics and speakers are available here.  If you enjoy our newsletters please encourage colleagues to sign up here.