With market diversity, a strategic plan, financial strength and trusted partners, VIH Helicopters Ltd. is weathering the economic storm.
There just isn’t anything like a nasty little recession to test and confirm that your long-term strategic plan is working as it was designed to do. One company that has demonstrated the value of long-term strategic planning is VIH Helicopters, which has its head office at Victoria International Airport on the southern tip of Vancouver Island, British Columbia.
With more than 55 years in business, VIH looks at this as just another economic cycle to work through. VIH’s success is a factor of strategic planning, financial strength and masterful execution of that plan. VIH’s marketing manager, Barry Holmes, offers insight as to why it has been successful. “It’s all about safety, and safety is a factor of people, product, place, price and performance,” he says. “Each component is as important as the other, and with proper execution, they equal a synergy called success.”
Well-trained Employees
VIH’s employees are highly skilled and receive annual recurring training to keep them at their best. The company has a permanent staff of approximately 250 employees, of whom 80 are pilots and 110 are in engineering/maintenance. The operational field crews are complemented by a strong management and administration team.
This experience of the company’s management team totals more than 240 years and 80,000 flight-hours of helicopter operations experience. This dynamic team includes General Manager Charlie Mooney, Operations Manager Corey Taylor, Assistant Operations Manager Wayne Woytkiw, Director of Maintenance Pat Renaud, Chief Pilot Usidean Ross, Heavy Lift Manager Jim Neill and Marketing Manager Barry Holmes. The “Safety Management Systems Team” is led by Brian Mycroft and Denis Ford.
Diverse Product Line
VIH operates a fleet of 50 helicopters in the light, intermediate, medium and heavy lift categories. This is made up of Bell 206 Jet Rangers, Bell 206 Long Rangers, Bell 407s, Astar B2s, Astar FXs, Bell 205s, Bell 212s, Sikorsky S61s and Kamov KA32s. This fleet can handle loads from five passengers to 23 passengers, and sling loads weighing from 1,100 to 11,000 pounds on the hook.
VIH recently upgraded its fleet with the purchase of seven new Bell 407s. The 407s are great workhorses and the customers love them, Holmes maintains. The Bell 407 cruises at 130 knots, is ultrasmooth and can lift up to 2,500 pounds at sea level on a standard day. That kind of lift translates into 2,000-pound drill moves in the mountains, and that means fewer picks and more drill footage in less time.
That is what major exploration clients like Copper Fox Minerals and Silver Standard Resources are looking for – cost-effective and high production performance on their high-grade gold, silver and copper discoveries. Or in the case of VIH client Hathor Exploration, it’s uranium in their Athabasca Basin discovery – a discovery that has the second highest uranium assays ever produced anywhere in the world. All these projects are in their early stages of expanding their resource calculations on these world-class ore bodies, and that means more drilling, which means more flying.
This balance of the fleet is contracted out to clients in seismic and mining exploration, summer contracts delivering guests to fishing lodges on Canada’s rugged west coast, or winter contracts flying heli-skiers at Mike Wiegele’s world famous lodge at Blue River, British Columbia, in the Canadian Rockies.
Variety of Operation
VIH’s 55 years of continuous operations have proven that diversity is essential. This applies to all elements of its operations, from VIH’s diverse market sectors to its geographic areas of operation.
VIH Helicopters’ major clients are in forestry, mining, oil, gas and tourism. This geographic diversity finds VIH with operational experience on six continents, including locations such as Angola, Australia, Brazil, Guyana, Pakistan (where it performed earthquake relief for the United Nations), Peru, Taiwan, mainland China and the United States.
Taylor explains, “If the forest industry and/or tourism are slow domestically as they are now, VIH can shift its fleet into other sectors inside Canada, such as mineral exploration or seismic exploration for the oil and gas industry. If local sectors are soft or lacking in opportunities, the shift then would focus on opportunities in other geographic areas.
“This ability has been the foundation for generating a consistent revenue stream, year after year, which gives VIH the financial stability to maintain steady growth and provide security for its employees.”
Due to weakness in the local forestry sector, VIH has repositioned its heavy lift fleet into South America, where it has been busy building pipelines and moving double-towered rigs that are drilling for oil and gas in the upper Amazon basin.
Taylor also states, “VIH has also sent a couple of other heavy-lift Sikorsky S-61 helicopters to Australia on fire-fighting contracts. Both S-61s had just come off of a very busy fire season in western Canada, and as the domestic fire season wound down, Australia’s was just starting.
“If you are not flexible and don’t have experience in dealing with the complex logistics of international operations, then you are doomed to sit at home and dance to the drum beat of the local economy,” Taylor asserts. “However, international operations come with a hefty price tag. Some of these fleet-repositioning charges can run into several million dollars before you turn a blade.”
The Price Has to be Right
“Regardless of the economic times, your price has to be competitive,” Holmes stresses. “You would think that with top-notch crews, a modern diverse fleet, excellent salary and benefits packages, and industry-leading safety management systems, that we would have a hard time competing with smaller, junior operators. But we can and we do.
“First off, we have a tremendous computer cost analysis program that we developed in-house,” Holmes points out. “We can input all our fixed and direct operating costs for a project and ensure that when the contract is completed, we didn’t just break even, but we – as forecast – came out with a profit.
“In the helicopter industry, the two biggest operating costs for a company – aside from employee compensation – are insurance and fuel,” he emphasizes. “It is because of our size that these two items give us a significant advantage in attaining lower operating costs. First, VIH has excellent training and safety programs, and that translates into an excellent safety record. That in turn gives VIH one of the industry’s lowest insurance rates.
“Second, VIH is a high-volume fuel consumer, and that has given us excellent purchasing power,” Holmes continues. “In the end, we use our size and experience to offer the best service possible and to negotiate specific operating cost saving advantages. But in this industry, more than any other, you get what you pay for, and our international reputation is one of an excellent, cost-effective service and great value for dollars spent.”
Partner Performance
VIH’s success is based on getting the job done safely, efficiently, on time and on budget, but that is just part of the story.
VIH has developed a group of first-class service providers that make a major contribution to its success. As Woytkiw explains, “Safety and risk management is fundamental to all VIH operations, and when VIH sends a helicopter to a job, it can be tracked anywhere on the globe. Every aircraft is equipped with a satellite tracking unit monitoring the aircraft’s location, speed and flight track, and the ability to send mission-related and emergency alerts via satellite-phone up-link.
“This system allows for real-time tracking, and our flight watch center can pinpoint the location of an aircraft within meters any time of the day, 365 days a year.”
When a helicopter heads out to a remote work location, it will require specialty operations gear for slinging. A heavy-lift helicopter might be tasked to move camp trailers, set up a mountaintop radio repeater system, sling a truck across a river, move bulk ore or set pipe on an inaccessible pipeline right-of-way. There is absolutely no tolerance for faulty or shoddy gear in these demanding operations.
Holmes stresses, “Our operational equipment manager, Matt Henry, is in regular contact with our major supplier, Test Right Rigging, who ensures all our sling gear is designed to do the job and that every item meets or exceeds all required loading and safety specifications.”
Another example of a high-performance partnership is that when VIH heads into the jungles of Peru to move drills, it will partner up with a local domestic helicopter operator like Helinka Helicopter Services. A select number of Helinka’s pilots will be trained and integrated into VIH’s operations, which gives VIH local knowledge in the cockpit.
In other circumstances, VIH may joint-venture with local First Nations. This gives it access to locals who can work with VIH ground and rigging crews. Such partnerships offer valuable training and employment for the local First Nations. Some choose to stay on as full-time employees.
Add It Up
While the helicopter is enroute to a job, the maintenance crew is on the road with specially equipped vehicles pulling whatever they will need to provide the necessary support to that operation. It may be heavy-duty 4-by-4 pickups pulling portable shop trailers and/or multi-environment tank fuel trailers.
Much of the fuel we use comes from another key service partner, Northwest Fuels Ltd. of Terrace, B.C. Manager Doug Ames ensures the multimillions of liters VIH consumes is picked up at the refinery by one of his fleet of Highway B-Trains and delivered safely to any of our projects in western Canada.
If the location is in the backwoods, then Bob Mackay of GranMac Services in Stewart, British Columbia, will use off-road tankers to get the fuel to the last few remote miles. GranMac also handles parts, groceries and ground transport of crews with its expediting business. Once the helicopters arrive on-site, they need reliable refueling equipment, and for safety reasons, the fuel has to be filtered through state-of-the-art systems provided by another key partner, Velcon Canada.
VIH has worked extensively to come up with exciting innovations to improve safety and cost-effectiveness, and this definitely shows up in its fuel handling and logistics support. VIH sits down with each client to apply the best options available for the entire project – gensets, diesels, heaters, helicopters, etc. – to satisfy the entire project’s fuel needs. Each client has emphatically stated that VIH’s fuel options have saved them considerable money and reduced the work load.
Chuck Blunt, president of Radius Drilling, is a huge supporter of VIH’s fuel management options, and is also a big fan of the Bell 407 as a drill rig mover. Blunt says, “The Bell 407 is really fast, like 140 mph, and it is the smoothest chopper I’ve ever rode in. But what is most impressive is its lift capacity on drill moves – consistently lifting over 2,000 pounds in the mountains – and that saves me money and improves production. And let me tell you, VIH has exceptional pilots, so it’s no wonder they are in demand around the globe.”
VIH clients also back up the fact that VIH’s fuel management options save money by simplifying trucking and storage. The extensive use of environmental tanks and rollagons helps reduce the chances of fuel cross-contamination, and simplifies delivery and handling in remote fly camps, the company says. There are no fuel drums or drum deposits and a significantly reduced risk of environmental liability.
“So to add it up: success is a factor of giving your clients a diverse fleet, skilled crews, competitive rates, high production, and doing it all safely – on time and on budget,” Holmes emphasizes. “There is no doubt that with VIH, it’s all about good people and good companies working together as a team, from the janitor in the hangar, the truck driver pulling fuel, all the way through to the client sitting beside the pilot in the helicopter. From that concept came our company motto: ‘Pride in service since 1955.’”
In conclusion, general manager Charlie Mooney states, “10 years ago, we developed an innovative and strategic plan to aggressively diversify our business model going forward. Through acquisition and reinvesting in growth, we have executed that plan to achieve fleet, market and global economic diversity. The next 10 years will see VIH focusing our helicopters, support infrastructure and expertise on the exploration sector. There is a strong long-term global demand for minerals and energy, and we plan to be there to help our clients succeed in making those discoveries. As I tell all of my management team, ‘A good plan is a flexible plan.’”
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