BC Business
When Dave Curtis calls in early February, it's the seventh time our interview has been rescheduled over the course of three months. The CEO of Viking Air has been a very busy man—and, if truth be told, a bit worried about talking to the media in the wake of his...
When Dave Curtis calls in early February, it’s the seventh time our interview has been rescheduled over the course of three months. The CEO of Viking Air has been a very busy man—and, if truth be told, a bit worried about talking to the media in the wake of his blockbuster deal, announced last November, to acquire Bombardier’s Dash-8 program and the de Havilland trademark for about $300 million.
“I have lawyers putting the fear of God into me around the Competition Board process—not wanting to get out ahead of all that. The good news is that we received our clearance certificate from Canada and the U.S. last week,” says the 57-year-old Curtis from his snowed-in home office in Victoria.
The only hurdle remaining, when we talk, is making sure all systems are in place for Transport Canada—which will sign off on all regulatory approvals in June.
For most of its 50 years, Viking has flown under the public radar. The business started in 1970 in Sidney, next to Victoria International Airport, as an aircraft parts and modification shop. In 1983, the company was selected by de Havilland Canada (DHC) to be the exclusive spare parts manufacturer and distributor for its Beaver (Dash-2) and Otter (Dash-3) planes—and by 2005, Bombardier (then-owner of de Havilland) had sold the rights of all out-of-production DHC planes to Viking, the Dash-1 through Dash-7. In a bold move beyond its core parts-and-service business, Viking put the Dash-6—otherwise known as the Twin Otter—back into production in February 2010.
Since then, nearly 150 400-Series Twin Otter aircraft have made their way through the Viking production facilities in Sidney and Calgary, where there’s a final assembly line.
“I think we’re in 27 or 30 different countries now,” Curtis says. “I was on the phone with my sales team this morning, and we were discussing opportunities in Africa and Indonesia.” Viking’s head count has risen from 60, when Curtis became CEO in 1991, to just under 700 today.
But all the moves the 36-year company veteran has made pale in comparison to the Dash-8 purchase. “We’re taking on 1,000-plus employees there,” says Curtis of the team at Bombardier’s Downsview manufacturing site in Toronto. “In the span of about 18 months, we’ll go from a US$300-million company to a US$1.5-billion company”—one that stretches across three provinces and four time zones.
Despite Bombardier’s desire to offload the one remaining de Havilland plane it had in production—the Dash-8 (Series 400), branded the Bombardier Q400—it still took years to complete the deal. “The complexity of taking the out-of-production [Dash-8 planes] and leaving the in-production [Q400] was too complex for Bombardier. So we sat on the sidelines, waiting,” Curtis says. “I just kept talking to them and saying, If you’re ever in a position to sell the whole program, we would be very interested.'”
When Bombardier finished its deal to sell a majority stake in its C-Series project to Airbus in July 2018, negotiations for the Dash-8 program took off. Viking sent a team of 12 to Montreal to close the deal last fall—senior managers, including Curtis, plus legal and finance. (“We were living in a boardroom in Montreal eating pizza for a couple of months,” Curtis recalls.) The Q400—whose biggest customer is Air Canada Jazz, with 85 planes—will immediately boost Viking’s top line: on average, Q400s sell for US$30 million, compared to just under US$7 million each for the Twin Otter.
The Viking deal also represents a dramatic shift in Canada’s aerospace landscape, which has long pivoted between Toronto and Montreal. According to former Quebec premier Jean Charest—whose report for the Aerospace Industries Association of Canada (AIAC) on the future of the industry, entitled Vision 2025, was expected to be made public this spring—the shift is a positive development.
“Viking is a fantastic story because it has a lot of momentum,” says Charest, calling from a Montreal-bound car in early April, following discussions with public officials in Ottawa. “It’s interesting in the national context because it speaks of the emergence of an OEM [original equipment manufacturer] in Western Canada. Bombardier has attracted an inordinate amount of attention—for some good reasons, and some not-as-good reasons. To see Viking emerge is good news.”
Although Charest is optimistic about the industry’s future, he, like Curtis, worries about manufacturers’ ability to find skilled workers. “I met with the national council on labour for this industry today,” says Charest, “and they said that in the next five years, at the rate that we are training, we are going to fill 20 percent of the positions that need to be filled, given what we have in the pipeline. That’s a big problem.”
As for Curtis, he’s taking the challenges ahead—including a labour shortage and a lease at Downsview that’s set to run out in three years—in stride. “I get to fly a Beaver all the time: I load the airplane up with kids and do my local Victoria tours. I play drums in a rock-and-roll band, which is good for my soul. And I have a good family life. I’m having fun.”
In January 2019, Longview Aviation Capital Corp.—the investment arm that controls Viking Airannounced that it would resurrect the de Havilland brand, with Viking’s Eastern operations to become the de Havilland Aircraft Company of Canada. (Longview is majority owned by Thomson family heir Sherry Brydson, Canada’s richest woman, through her Victoria-based Westerkirk Capital)
1928: de Havilland Aircraft of Canada (DHC) is formed by the British aircraft manufacturer to build Moth light aircraft for the Royal Canadian Air Force1946: DHC‘s first postwar aviation craft, the DHC-1 Chipmunk, is launched1962: DHC assumes control of the Avro Canada aircraft production facility1974: After flagging sales of its Dash-7 aircraft, British owners Hawker Siddeley Aviation sell DHC to the Canadian government 1985: The government privatizes DHC, selling it to Boeing for $155 million|1992: Bombardier purchases DHC from Boeing, in a complex $600-million deal that sees the Ontario government taking a 49-percent stake in the company2005: Bombardier sells the rights for all out-of-production aircraft (DHC-1 through DHC-7) to Viking Air|2018: Bombardier sells the Dash-8 program and de Havilland brand to Viking parent Longview