E-Z-GO 2007 Annual Report Download - page 22

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PA R T I
Item 1. Business
Textron Inc. is a multi-industry company that leverages its global network of aircraft, industrial and fi nance businesses to provide customers with
innovative solutions and services around the world. We have approximately 44,000 employees in 34 countries. Textron Inc. was founded in 1923
and reincorporated in Delaware on July 31, 1967. Unless otherwise indicated, references to “Textron Inc.,” the “Company,” “we,” “our” and “us” in
this Annual Report on Form 10-K refer to Textron Inc. and its consolidated subsidiaries.
We operate our business through four operating segments. Three of our operating segments represent our manufacturing businesses: Bell,
Cessna and Industrial. Our fourth segment consists of our Finance business. A description of the business of each of our segments is set forth
below. Our business segments include operations that are unincorporated divisions of Textron Inc. and others that are separately incorporated
subsidiaries. Financial information by business segment and geographic area appears in Note 20 to the Consolidated Financial Statements on
pages 73 through 75 of this Annual Report on Form 10-K. The following description of our business should be read in conjunction with
“Management’s Discussion and Analysis of Financial Condition and Results of Operations” on pages 15 through 32 of this Annual Report on
Form 10-K. Information included in this Annual Report on Form 10-K refers to our continuing businesses unless otherwise indicated.
Bell Segment
The Bell segment is comprised of Bell Helicopter and Textron Systems.
Bell Helicopter is one of the leading suppliers of helicopters, tiltrotor aircraft, and helicopter-related spare parts and services in the world. Bell
Helicopter manufactures for both military and commercial applications. Revenues for Bell Helicopter accounted for approximately 19%, 20% and
21% of our total revenues in 2007, 2006 and 2005, respectively.
Bell Helicopter supplies advanced military helicopters and support to the U.S. Government and to military customers outside the U.S. Bell
Helicopter is one of the leading suppliers of helicopters to the U.S. Government and, in association with The Boeing Company, the only supplier
of military tiltrotor aircraft. Bell Helicopter’s three major U.S. Government programs are for the V-22 tiltrotor aircraft, the H-1 helicopters and the
Armed Reconnaissance Helicopter (“ARH”).
Bell Helicopter is teamed with The Boeing Company to develop, produce and support the V-22 Osprey tiltrotor aircraft for the U.S. Department of
Defense. Tiltrotor aircraft are designed to provide the benefi ts of both helicopters and fi xed-wing aircraft. The U.S. Government has issued
contracts for 113 production V-22 aircraft through production Lot 11, of which 78 have been delivered as of the end of 2007. The U.S.
Government’s program of record for the V-22 calls for a total of 458 production units.
The U.S. Marine Corps H-1 helicopter program includes an advanced attack model and a utility model, the AH-1Z and UH-1Y, respectively, both
of which were designed to have 84% parts commonality between them. Through Low Rate Initial Production (“LRIP”) contracts, the U.S.
Government has contracted for the production of 26 UH-1Y aircraft and eight AH-1Z aircraft, of which 10 were delivered by the end of 2007. Phase
II of the H-1 Operational Evaluation (“OPEVAL”) is scheduled to commence in the fi rst half of 2008; successful completion of OPEVAL is required
prior to our receiving authorization for full-rate production. The U.S. Government’s program of record for the H-1 program calls for a total of 280
production units.
Bell Helicopter currently is working under a U.S. Government System Development and Demonstration contract for development of the ARH.
During 2007, after uncertainty about whether the U.S. Government would continue with the ARH program, the U.S. Army agreed to restructure the
program. Bell continues to work with the U.S. Army to fi nalize details of the restructure and anticipates that initial LRIP contract awards will be
granted in mid-2008. The U.S. Government’s program of record for the ARH currently calls for a total of 368 production units; however, based
upon communications from the U.S. Army, we expect that the U.S. Government will increase production requirements to 512 units during 2008.
Bell Helicopter also is a leading supplier of commercially certifi ed helicopters and support to corporate, offshore petroleum exploration and
development, utility, charter, police, fi re, rescue and emergency medical helicopter operators. Bell Helicopter produces a variety of commercial
aircraft types, including light single and twin engine helicopters and medium twin engine helicopters, along with other related products. The
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Textron Inc.