It was a very European compromise. Back in 2007, reeling from a feeble dollar, the A380 debacle and the need to fund development of the A350, bosses of the then-EADS launched a drive to cut costs and streamline the Franco-German group’s cumbersome vertically-integrated organisation. Part of the solution involved divesting aerostructures plants in France, Germany and the UK to chosen suppliers. The idea was that these enterprising and leaner tier ones would introduce efficiencies, while guaranteeing a continuity of supply.
However, while GKN snapped up a facility in Filton, political opposition and wobbles from preferred bidders Latécoère and MT Aerospace put paid to plans to sell the French and German operations. Instead, in 2009, a pragmatic EADS management spun off the two entities as semi-independent businesses, responsible for their own affairs but ultimately owned by, answerable to, and almost entirely reliant on EADS and its Airbus division for their revenues.
Forged from EADS and Airbus plants in Augsberg, Bremen, Nordenham and Varel, as well as a factory in Romania, Premium Aerotec – like its French counterpart, Aerolia – is a sizeable firm in its own right. In fact, with 9,200 employees and revenues of around €1.3 billion ($1.8 billion), it can lay claim to be the largest German aerospace company (just pipping engine manufacturer MTU).
Premium Aerotec contributes to the structures of most Airbus aircraft – specialising in composite and metal fuselage shells but also wing components and floor structures. It also builds the pressure bulkhead for the Airbus A350 and – in its only substantial “third-party” piece of business – for the Boeing 787. The A350 is its most important programme: the company is responsible for most of the front and rear fuselage, including the section 16-18 side shells and the entire section 13-14, together with floorgrid crossbeams for each.
A new factory, set a short drive from its main complex in the Bavarian city of Augsburg, looks quite roomy now but is beginning to fill with jigs and tooling as Premium Aerotec gears up for volume production of the Airbus widebody twinjet. Responsible for the composite rear fuselage sections (Nordenham does the front sections, while the middle part of the fuselage comes from former Boeing business Spirit AeroSystems), Augsberg has delivered more than 20 shipsets for the first variant, the A350-900. It will begin work on panels for the stretch -1000 – each 3.8m (12.5ft) longer at 17.6m – around October, with three sets earmarked for delivery this year.
Premium Aerotec is keen to portray itself as more than a giant workshop for its parent, however. It wants to be known as an innovator, says Klaus Kalmer, head of engineering. Inherited from Airbus, whose engineers helped develop it, the company owns a 28% share in Fokker’s GLARE fibre-metal laminate material, currently only used in the A380. Premium Aerotec also has the patent on vacuum assisted process (VAP) technology, which allows the large-scale manufacturing in a single step of large carbonfibre components such as the 4.5m-diameter pressure bulkheads for the A350 and 787.
The company has its own engineering division in Augsberg and, among its projects, it has been working on carbonfibre surrounds for the doors in its A350 fuselage sections, shedding 70kg from the weight of the -1000, compared with the -900, as a result. “There is an option to roll that technology back into the -900,” says Kalmer. Any decision to invest in larger-scale composite programmes would be Airbus’s, he notes, but “we are prepared to follow what they decide”. Innovation is not only restricted to composites. “Our metal guys have not been sleeping,” says Kalmer. “You will see some important alloy developments too.”
Premium Aerotec is also introducing innovation in some of its organisational practices as it moves towards being a “real company”, says Jens Krüger, head of communications and political affairs. Although the establishment of Premium Aerotec as an independent entity can be seen as a “real success story”, he admits that “cultural challenges” remain, particularly in giving staff a feeling of corporate identity. “Airbus is our shareholder and main customer but we are not part of Airbus,” he says. However, when recent unfounded reports emerged that Airbus Group management planned to reintegrate Premium Aerotec back into the main company, many shopfloor employees welcomed the rumours.
One of the biggest hurdles Premium Aerotec faces is coping with its own success as it moves from producing structures for legacy programmes to scaling up for the A350 and increased production of the A320 and A320neo families. Oiling the cogs of the company’s processes is the job of new chief operating officer Michael Colberg, who joined Premium Aerotec last year from Daimler. “We need to learn lessons from the automotive industry,” he says. “This has been prompted by the ramp-up. We need to create a synchronised flow, with shorter lead times.”
The company is “beginning to see the advantages of what can be achieved in a faster time”, says Colberg. Previously, the Premium Aerotec ethos was very much oriented to quality, but sometimes at the expense of efficiency and speed of delivery. “We never talked about logistics. Quality is a given, of course, but it is not the ultimate objective without other elements,” says Colberg, who admits to only being 25% of the way to a five-year objective to turn Premium Aerotec into a “new environment”.
Under the old EADS and Airbus ownership, individual factory managers had a lot of autonomy, says Colberg. “We are trying to get rid of investment overlaps and control more from the centre.” Another goal is introducing just-in-time philosophies for in-bound and out-bound products – what Colberg calls “lean material flow”. Following the Airbus example, transport organisation and parts warehousing will be outsourced to a haulage and logistics specialist.
The decades-old Augsburg facility will be reorganised. “Our A320 line is very congested and we need to make it a much leaner operation,” he says. The current layout was designed for production of around seven shipsets a month of narrowbody fuselage sections. In a few years’ time, it will need to be producing 44. “Hitting those 44 shipsets will be very difficult,” Colberg acknowledges.
Aside from the 787 bulkhead, Premium Aerotec has carried out other work for Airbus’s arch-rival, including a composite wing spar, incorporating a wave-shaped vertical section to save weight, as part of a two-year technology project for the US airframer. However, while the temptation for Premium Aerotec might be to seek out more third party business, as Spirit Aerosystems did aggressively in the 2000s, Colberg says any broadening of the customer base will have to be closely managed.
“It is important to expand beyond Airbus, but we are facing a ramp-up of legacy programmes and the A350, so we really need to concentrate on delivering to time and quality,” says Colberg. “It would be hard – perhaps even dangerous – to digest third-party work before we reorganise the company.” A glance at the Premium Aerotec website or marketing materials will see no mention of its parent company – there are not even any subtle branding clues. However, until it takes the next step in its development as an independent entity, Premium Aerotec will not be looking too hard for business beyond the demands of its biggest customer.