Ian Godden, 英国航空航天公司
Release Date: 2009-10-08
What has been the need to form A|D|S by merging the Association of Police and Public Security Suppliers (APPSS), the Defence Manufacturers Association (DMA) and A|D|S? What are the ambitions and challenges that A|D|S is expected to overcome?The merger of these three strong trade associations to provide one powerful voice for these successful UK sectors was driven by the needs of our member companies. The new A|D|S will also be driven to meet these needs. When asked to vote well over 90 per cent of our members voted in favour of the merger, which demonstrates clearly that it is the right thing to do. With the overlap between each of the sectors, for example between defense and civil aerospace avionics and components or on airport security the industries are closely related and a single, larger trade association gives more emphasis to our messages to Government, overseas partners and the media with which we can aim to create the best possible business climate for our members. A|D|S will take on the priorities of its members and alongside the challenge of building the new organization into something more than just the sum of its parts it is our aim to ensure that the success of high-tech manufacturing and global leadership that the sectors in the UK represented by A|D|S prosper and are celebrated by the public and decision-makers.
While there is no lack of uncertainty about the future of the global aviation industry, you are very confident that the UK aerospace industry will continue to grow. How can this be explained?
The UK is not just an aerospace economy: it is an aviation economy. It thinks, breathes, and lives flying. It's a small island, it has an international business culture, and its consumers love to get away in search of more sun. Also, inherent in the defence of the nation and in the promotion of industrial aims, it's always had an emotional attachment to flying. That has sustained the UK to 'punch above its weight' in this industry. We are the 2nd largest aerospace and defence economy in the world by any measure - it's bigger than France - and I have every confidence it will remain that way. We have an inherent passion for aviation. You just need to go around to all the local air shows (not trade shows) around the country to realize that air travel is in the British blood. We have airlines that are fast moving and innovative - British Airways, Virgin Atlantic, EasyJet, and Ryanair in Ireland. Our passion for flying will sustain us through thick and thin.
We have already moved away from an economy that relies on nationalistic primes and have entered an era in which we have a specialized more international role within the aerospace and defence industry based on technology and business innovation. In civil aviation, we are specialized around engines, wings, rotorcraft, and unmanned aerial vehicles (UAVs), and focused very heavily on the opportunity of developing sustainable aviation. This latter view comes from a balanced understanding that flying is here to stay but is facing environmental and fuel-related pressures. Also, the UK has an extra motivation in that it has its own oil economy - with companies like BP and Shell - and therefore has more reasons to be interested in innovating in the area of fuel. So, despite having a reputation for not having a large commercial prime position anymore, it's very active on all fronts. With investments from Government and Industry alike, combined with flexible labour patterns, it's demonstrated over the past 15 or 20 years that it can be competitive in this globalising industry, despite all the negatives about UK manufacturing. We've done more than survive. The large factories in this country, such as Rolls Royce, Airbus, Bombardier (Short Brothers), and electronics plants like SELEX, are fully vested, fully invested, and are as competitive as anybody in the world. The industry is an unsung hero of British manufacturing and engineering. That gives us confidence that although there is going to be huge pressure in the next few years, the base of the UK business is solid enough to ride out the storms that are coming. Fundamentally, we have the right psyche, a good competitive base, and still an ambitious role accepted by Governmental and Industry leaders.
Short Brothers is not a name that everybody is familiar with these days?
As the first licensed builder of the Wright Brothers' Wright Flyer exactly 100 years ago, Short Brothers was the first commercial aerospace manufacturer in the world. The company then emerged out of a typical government rescue in the 1970s, to create a strong and growing position today as part of the Bombardier Group. It has global responsibility for designing and manufacturing the wings for the C-Series aircraft. Short Brothers are expanding internationally from their base in Northern Ireland to meet the needs of Bombardier worldwide, including China. The company has become ambitious both in Europe and beyond for a few reasons. First, it has grown out of its role as a regional development need of Northern Ireland which was supported for political reasons. It has paid back in full measure to the UK government and is now seeking an increased role in the world within the Bombardier family which encourages Short Brothers' ambition.
Foreign Direct Investment (FDI) has driven employment growth in the UK aerospace industry of the last several years. What competitive advantages are you trying to promote to bring in more FDI?
First of all, an important component of our international nature is that UK aerospace companies own a lot of assets abroad. We've had a good run at FDI for 15 years although our status as global leader in outward investment may change since we are now being challenged. At the same time, UK exports should rise now as the significant constraint over the last two or three years of the high - to US$. The flip in currency valuations has been very beneficial at the right time for us. My confidence for the future is not blind optimism but rather a belief that the fundamentals of our industry are very strong.
Foreign companies like GE Aviation, Finmeccanica, and Boeing spin-off Spirit AeroSystems, are particularly active in the UK. I suspect that due to the nature of the UK as an international, business friendly hub, they were able to see the ability to become part of Boeing's and Airbus's efforts here and to manage the really complex supply chain underneath it.
There are different ways of looking at our specific core competencies. With all its software, combustion, advanced materials, hydromechanics, and electronics, an aero engine is the most densely packed technological item in the industrial world. You can't imagine a device that is more packed with technology. I defy anybody to do so. When compared to engines used in industrial or marine use, aero engines in particular have an extra safety and reliability issue that the others don't have. We have a company that was rescued by the government from the global shocks of the 1970s and has successfully invested and reinvested to claw its way from #4 to #2 in the world of aero engines. It's done so through a focused effort free of distractions from other lines of business. That is a good example of where this country can operate - multi-technology specialized products with an application that's global. In the Porter View of the competitiveness of nations, that is a feature of, and a good model for, the UK. Our aero engine expertise involves lots of different technologies and leverages an ability to adapt technologically. Rolls Royce has invested in all its main regions of focus - UK, Germany, China, Japan, and the US - and has as many assets abroad as in the UK. Therefore, at one level the company is now neutral to its national origins. Another example of this is GKN which has more assets in North America, Germany, and Japan than in the UK. The UK has several other examples of this type of international business model.
Another big strength of ours is that we have 3,000 SMEs with 20-300 employees each, which are equally spread throughout the UK. Many of them are world players and many of our members don't even consider themselves as British per se anymore. I just returned from one that has grown rapidly over the last 5 years based on the design engineering capabilities of its 150 engineers who work on projects for Boeing, Airbus, AgustaWestland, and Rolls Royce. It's a very strong engineering skill base which has an entrepreneurial and global attitude that makes us competitive.
Most of UK aerospace's sales are export sales, mostly to the US and other European countries. Other than well known examples like Rolls Royce, are there many UK players who are looking to drive their growth through an enhanced effort in markets that are a bit farther away, like China?
We have to talk about ownership of assets abroad rather than just exports. North America has been the biggest recipient of UK aerospace and defence investments in the last 20 years. We own significant sections of North American defence and aerospace. This doesn't come up in export figures. At the same time, Europe is more of an export market for us.
As for Asia, both at the Singapore and Japan air shows this year, we were the 2nd largest exhibitor after the US. Our 17 SMEs exhibiting at Japan Aerospace 2008 last month were larger than any other European representation. Our Director of Civil Aviation Transport, who is actually a Frenchman, is with about 10 UK companies at Airshow China 2008 in Zhuhai. He is promoting British interests there as we speak.
People need to understand when they look at UK-China trade figures that our export statistics do not include the entire airplane wings and other components which go to Toulouse to be exported from France. There's a distortion in the figures because a wing sold to China Airlines is counted as a UK export to France rather than a UK export to China. We have to pay attention to the ultimate destination rather than just the intermediate destination. Every time an Airbus aircraft is sold in China, typically 33% of the value is from the UK but is not counted as a UK to China export. We certainly have the most global of all the aerospace industries by any measure - more than the US, more than France, and more than Germany. This is not obvious from the figures due to the structural distortions I've pointed out.
The industry can't count on anything anymore, not on currency valuations and not on the price of the barrel of oil. Rolls Royce has taken a proactive role - in collaboration with the 'mainframers' as well as the airlines - in the search for every possible way to bring out efficiencies in aircraft. UK Trade & Investment (UKTI) has also been quick to identify this as a market opportunity for UK companies to play a leading global role. What is the latest in UK-based efforts to develop the 'greener' aircraft of the future?
There are three niche priorities in civil aerospace. We have a program, the National Aerospace Technology Strategy (NATS), which is highly focused on the new Airbus NSR ('New Short Range') or single-aisle aircraft that will replace the A320 and the Boeing 737. The UK industry as a whole is focused on the single-aisle replacement. We have similar programs for rotorcraft and commercial unmanned aerial vehicles (UAVs). Those are the other two main priorities.
While current market conditions might affect the timing of NSR and there is plenty of discussion on the specific launch dates, the end of the next decade is likely to see this next generation introduced into the global fleet. This aircraft is a crucial next step in the industry as we have already filled out the high end with aircraft like the A380 and the stretch 747, and are pushing the boundaries of composites into traditional aircrafts as far as possible. That trend will continue but the industry is reaching the end of an envelope in traditional thinking. This is great news for British industry because that is where it tends to do well. In this country we are always keen to move on to the future. We are reaching that new boundary.
In terms of the new short-range aircraft, there are some very specific programs which the industry has got to go over. It is very unusual for this country to have a 20 year National Technology strategy, but we have developed one for the new short-range aircraft through a collaborative effort of government and industry, driven heavily by Airbus and Rolls Royce. The government has committed resources at a time when that's not easy and we have an agreement with the government on objectives that cover the next 12 years. Twenty or thirty years ago, Britain just didn't do this sort of thing. But in the end it will be up to consumers, customers, and major suppliers to agree to move to radical new technologies such as the open rotor aircraft engine, blended wings, and all sorts of interesting schemes and equipment being considered now. I'm confident that whether the industry backs off a little bit and becomes conservative, or it decides to push the technological boundaries, the UK will be there in some way. This will not be in the traditional role of being a prime but as an innovator in terms of large sub-systems of airframe, and of course propulsion as a whole. We have 3,000 companies that are ambitious to be part of the future of landing gear, wings, engines, parts of cockpit, and parts of structure that will go into the next generation of short-range aircraft. In addition, we are challenging the conventional way of thinking which leads one to ask of manned and unmanned aircraft if one will replace the other. The answer is 'no.' To get efficiencies we will have to look at UAVs combined with manned aircraft. There's quite a lot of excellent new thinking going on in creating innovative applications (rather than thinking about the device itself) that can apply to areas like weather forecasting and policing.
The benefit of working with rapidly emerging economies is that they are starting from scratch, they have no 'baggage', and they have the option of implementing systems and infrastructure that use the kind of new technologies that can create a world-leading position. It is for this very reason that China's ambitious CACC very large jet program looks forward to forging strategic international partnerships in areas like aero engines. What agenda are A|D|S members pushing at Zhuhai right now? Does it match the Chinese desire to secure partnerships in such technology-heavy areas?
There are some genuine areas that we need to work on in developing the direct UK to China business arena. The two main areas that need to be worked on are psychological.
One is the 'it's further than anywhere else' syndrome. Nearby we have Europe, North America, and India, which has a stronger industrial history and a common language with the UK. At a stretch, medium sized companies such as Hampson Industries have gone further with their expansion and ambitions in Japan and the Far East.
It's widely recognized that we have to develop UK-China direct relationships rather than dealing with China just through the stronger natural connections of other European countries like France and Germany. We, as a nation, need to reach out more to establish an industrial link with China that moves beyond the accomplishment of UK companies like Rolls Royce, GKN, Bombardier's Short Brothers subsidiary, and a handful of smaller companies, as well as foreign-owned companies with a significant operational base in the UK like Airbus UK, GE Aviation, and Finmeccanica. We are at the forefront of nationality not being important; however, with regard to China, we have a very narrow relationship at the moment in this sector and we need to encourage companies in the UK to take a big step to widen it. We have to get over our attitude that 'you land in India rather than China'. In my role, I certainly will try my best over the next two or three years to increase our direct interconnection with China. But of course this aspiration has to be mutual.
Secondly, the industrial base here needs to be better understood by the Chinese. I think there's a perception that France is the only place to be when seeking a connection to the European Aerospace Industry. It's absolutely wrong. This is a psychological challenge for the Chinese. Just because the headquarters of EADS and Airbus are not in the UK, does not mean that the UK-based aerospace sector does not have a more critically important role to play. The US, Japanese, and Indian industries understand this.
So there are two psychological challenges to more direct industrial relationships, one for the British and one for the Chinese. If we can overcome these, then a large number of opportunities will emerge slowly but surely over the next decade.
| Company: | 英国航空航天公司 |
| Position: | Chiairman |
| Country: | 英国 |