Farnborough Airshow: Reasons for UK aerospace to be cheerful

The Farnborough Airshow is really many an general event, though it is still an arise for a domestic aerospace and counterclaim attention to put a best feet forward.

BAE Systems, Rolls-Royce and GKN are among a tip tier of companies schmoozing intensity customers, though serve down a supply sequence there are hundreds of smaller firms compelling their things to a world.

After years of unpleasant restructuring – that is still going on – and with a UK supervision clearly delivering on promises to assistance a industry, a airshow finds a domestic zone in a some-more certain mood than for many years.

“I’m not observant all is sorted though we are undoubtedly on a right track,” says Paul Everitt, arch executive of ADS Group, a trade physique for a UK’s aerospace and counterclaim sector.

A investigate by a Centre for Economics and Business Research (CEBR), consecrated by ADS forward of Farnborough, found that a UK aerospace attention grew 9.4% final year.

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UK aerospace firms: Five biggest barriers to growth

  • Fall in spending by existent business (32%)
  • Inability to secure outmost financial (23%)
  • Uncertain tellurian economy (19%)
  • Lack of schooled workers (17%)
  • Lack of sufficient inner financial (17%)

Source: ADS/GfK NOP survey

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With roughly 3,000 UK companies handling in a sector, contracting about 109,000 staff and generating annual revenues of £27.8bn, aerospace stays one of a UK’s many poignant industries.

“Unlike a UK volume automobile attention that for a many partial merely assembles cars here in a UK regulating alien parts, a UK blurb aerospace attention has managed to keep a large, fit and really good invested supply chain,” says researcher Howard Wheeldon.

Two-thirds of UK aerospace companies design to grow by some-more than 10% over a subsequent year, according to a CEBR report, and roughly three-quarters contend they devise to boost investment.

Although a US and Europe still make adult 70% of a industry’s exports – accounting for £2.4bn and £5.4bn of sales respectively – other markets are increasingly important.


Exports to China were usually £200m in 2013, though that was still 23% adult on a prior year. Sales to a Middle East were adult 75%, helped maybe by a United Arab Emirates’ aspiration to build a domestic aerospace industry.

Textron ScorpionTextron’s new Scorpion jet, here drifting over Corfe Castle, in Dorset, is creation a general entrance during Farnborough

Problems remain, such as skills shortages and entrance collateral for an attention where payback on investment is mostly 5 to 10 years away, though Glynn Bellamy, UK conduct of aerospace and counterclaim during KPMG, says a zone has “undoubtedly come by a tellurian downturn well”.

“Trouble is, we are now vital with 20 years of under-investment,” he says. “[However] a aerospace attention has not seen a drop over a final few years, and we would design that to continue.”

Key to this expansion has been a ability to daub into a outrageous tellurian direct for polite aircraft.

Boeing and Airbus have a record sequence reserve of some-more than 11,000 aircraft, providing an estimated 9 years’ work for UK industry.

“As prolonged as orders from airlines for Airbus and Boeing aircraft keep rolling in it will be good news for a UK, since we minister so many calm to both,” says aviation consultant John Strickland. “We furnish leading-edge record for both, and that means high-value jobs opposite a economy.”

Feast or famine

Paul EverittMore UK firms are re-shoring work from abroad, says ADS’s Paul Everitt

Increased atmosphere transport in Asia, Africa and South America over a subsequent 30 years is foresee to expostulate direct for during slightest 29,000 new vast planes, according to estimates by both Boeing and Airbus. Demand for tiny aircraft, private jets and helicopters is put during some-more than 70,000.

“Rolls-Royce is now a usually engine choice on a new Airbus A350. There’s an awful lot of work there that’s assisting to expostulate direct by a supply chain,” says Glynn Bellamy.

Airbus also has a wing-making operation in a UK, that sends a cascade of work down a pipeline.

The prolonged lead times on large industrial projects can be feast or fast for sub-contractors, depending on either programmes are ramping adult or circuitous down.

That is generally loyal in a counterclaim sector, where contracts can widen out a decade or more.

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UK counterclaim firms: Five biggest barriers to growth

  • Fall in spending by existent business (46%)
  • Lack of UK business opportunities (24%)
  • Uncertain tellurian economy (22%)
  • Lack of schooled workers (20%)
  • Uncertain UK economy (17%)

ADS/GfK NOP survey

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It is mostly not transparent where a aerospace attention ends and a counterclaim attention begins. Companies frequently work in both realms, and many are diversifying into new areas such as cyber confidence and communications to assistance equivalent troops spending cuts in a US and Europe.

But a CEBR investigate estimates that a series of UK employees operative on defence-related projects is 162,400. The attention has a turnover of £22.1bn, and counterclaim exports contributed roughly £10bn to a UK economy final year, an 11% arise on 2012, a CEBR says.

Defence work is underpinned by some outrageous programmes begun some-more than a decade or so ago, such as a new aircraft carriers for a Royal Navy, a Eurofighter Typhoon aircraft, and Lockheed Martin’s huge F-35 warrior jet project, which might or might not make a UK entrance during Farnborough after this week.

The striking next sum some UK-based companies concerned in a F-35, though in fact about 500 British firms have worked on a $400bn (£230bn) project.

BAE Systems, that is holding a lead on UK work for a F-35, has invested £150m in new F-35 comforts during a Samlesbury site, in Lancashire, where it works on a F-35′s fuselage and tailfins. Some 2,000 staff are involved.

If, as Lockheed claims, there is a marketplace for 4,000 F-35s a tube of work will widen for years.

“It’s not usually a make and growth that matters. It’s a support, upgrades and refits that will be indispensable over a entrance decades,” says Mr Everitt.

The industry’s some-more certain mood has a lot to do with a Aerospace Growth Partnership (AGP), maybe a closest a UK has to an industrial strategy, he says.

AGP is a government-industry beginning that enclosed sourroundings adult a record hospital and bursary intrigue for engineering students. It is about focusing on product innovation, opening doors and meditative long-term.


Mr Bellamy believes a full advantage of a AGP might be felt reduce down a UK supply chain. Previous supervision attempts to support RD and consider long-term focused on top-tier companies.

Airbus A350Airbus is anticipating for orders for a new A350 after a warn preference by Emirates Airline final month to cancel a deal

“But there’s a lot some-more RD and longer-term meditative reduce down a supply chain. It means that a UK has a supply sequence that does not have to live or die with a success of Rolls-Royce or BAE Systems. You need some-more product creation reduce down a sequence and a AGP is assisting to do this,” Mr Bellamy says.

He does, however, feel that a UK supply sequence is too fragmented. Although a UK has some-more aerospace and counterclaim companies than is standard among European countries, they tend to be smaller.

A miss of scale can be emasculate and costly. “At a tier-2 spin and next there needs to be some-more converging and partnerships in a supply chain,” Mr Bellamy says.

Shaun Ormrod, Farnborough International

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Shaun Ormrod says tiny firms assistance make a airshow a success

No one is sanctimonious that all is rosy. But in what can be a really cyclical industry, a stream arena appears to be up. Can it continue?

“The bottom line is that it will usually sojourn so if we continue to place large-scale bid on RD and also deposit in people so that we can say a clever lead,” says Mr Wheeldon.

“There is plenty justification in a annals of UK production story that tell us because so many of a industries in that we also used to lead fell away.”

Lack of vision, miss of skills, supervision indifference, complacency: they all play a partial in industrial decline. But maybe, usually maybe, lessons have been learned.

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