Improved product support is the central focus for MD Helicopters’ new management group, following the storied manufacturer’s exit from bankruptcy and the completion of its sale to new owners.
The purchase was complete Aug. 15, with the owners – a group of investors that includes MBIA Insurance, Bardin Hill and MB Global Partners — appointing aerospace industry veteran Brad Pedersen as the MD’s new president and CEO.
“None of our suppliers or customers should worry about the financial health of MD Helicopters — we’re sound and solid going forward,” said Pedersen in a conference call with media.
With the new owners and management team in place, the company is finally able to move forward, said Pedersen, who began his career at Hughes Helicopters, and has worked at Boeing Rotorcraft, Sikorsky Aircraft and Breeze-Eastern.
“I bring a lot of experience turning around companies and rebuilding companies successfully,” he said. “It’s not easy. It’s hard to do. But we also don’t have to violate any laws of physics to do it.”
The “new MD” is officially known as MD Helicopters LLC (the previous Patriarch Partners-owned incarnation was known as MD Helicopters Inc.), and will be abbreviated as MDH.
It will be run by a board of directors, chaired by former Boeing executive Ed Dolanski. Other board members include General (ret.) Gustave Perna (who led Operation Warp Speed — the U.S. effort to accelerate the development, production and distribution of Covid-19 vaccines and treatments), and Paul “Flip” Huffard, a finance expert with more than 30 years’ experience of restructuring companies.
Pedersen stressed that Patriarch Partners was no longer part of the company.
MDH will also have a new CFO, VP of aftermarket sales and support, and VP of new aircraft production.
The company will stay at its current home in Mesa, Arizona, and is planning to grow its staffing numbers from the current 250 employees.
Pedersen said there are “six or seven” aircraft currently on the production line, but that he hopes to grow that to 15 to 20 per year by 2023.
“We don’t have it finalized yet, but we have customers, we have an order book that’s growing, and I think that somewhere between 15 and 20 is a fair number for next year,” he said.
However, improved customer support is at the heart of MDH’s short-term strategy.
“The changes we’re going to make are those that are needed to address the market, to do better . . . customer support, be more responsive in the aftermarket — because I think that’s been MD’s biggest issue in the last several years,” said Pedersen.
To help improve its customer support, former Bell executive Ryan Weeks has joined the company.
“[Weeks] has a lot of experience in the rotorcraft business in improving the whole aftermarket experience — be it training, spares, overhaul, repair, [or] upgrades,” said Pedersen.
In terms of concrete changes, Pedersen said the company would be investing in spare parts and continuously measuring its performance in turnaround times for overhaul and repair. “Most of [MDH’s] injuries — the wounds — are self-inflicted,” he said. “Stabilizing our process, stabilizing our production, stabilizing the management is the key to doing that turnaround. And then once you get the processes and things stabilized, then you can focus on the growth, the new products and other things.”
That said, customers can expect to see upgrades to MD’s product line.
“The [MD 500] E model and [MD 530] F model have all been a bit stagnant over the last couple of decades,” said Pedersen. “I know there’s some improvements we can make. We have made some improvements recently with some slimline glass cockpits to give better visibility, as well as crash resistant fuel cells. So we’ll look to do more of that — add functions that are important to the customers and add utility to their operations.”
Though he wouldn’t give any specifics, Pedersen said these improvements would be based on enhancing maintainability, reducing operating costs and improving lift.
In terms of the company’s product lines, Pedersen said MDH would “seriously consider” restarting production of the MD 900 (which ceased in 2010) “if there is a large enough order.” Again, however, he emphasized that his initial focus would be on supporting the roughly 100 900s still flying around the world.
“The initial thrust with us is going to be stabilize the company, do a better job of supporting our products, and then we can move on, we can grow the product line accordingly,” he said. “But I think the main things right now, looking in the next two-to-five years, is to do what we have been doing a lot better. And with the stability of coming out of bankruptcy, now I think customers can feel confident that we’re going to be here for a long time.”
