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Aviation History
1975
1975 - 2025.PDF
FLIGHT International, 2 October 197S 473 AEROSPACE-INDUSTRY EFFICIENCY ., ALMOST EVERY annual review of the British aerospace industry begins with an account of the year's record ' exports. This year is no exception and, according to the records of the Society of British Aerospace Companies, exports during the first half of 1975 were 30 per cent up on last year's figure for the same period (see Fig 1, page 474). While the SBAC figures need to be interpreted with care, including as they do the shipment of parts for collaborative projects to partners in Europe, there is no doubt that production is running at a high level. During the last decade, only 1967 and 1970 have shown a hesita tion in the upward trend of exports, even taking into account the falling value of the pound. Figures from the British Department of Employment Gazette show that the aerospace workforce in the United Kingdom (excluding \orthern Ireland) rounded out at 195,500 in July 1973, crept up to 208,700 in December 1974 and has since slipped back to 205,200 (see Fig 2). Short Brothers employs some 5,630 people in Northern Ireland and the total for the province is between 6,000 and 7,000. In the 11 years up to the end of 1974, according to the SBAC definitions, industry exported goods worth £3,410 million, more than 50 per cent of turnover. Figures from the EEC suggest that aerospace accounts for 1 -6 per cent of the UK gross domestic product. Although work in hand now exceeds £715 million in value, up from £549 million in 1973 (figures taken from the Government publication Business Monitor), and the in dustry remains the biggest in Western Europe in terms of manpower, doubts about the future remain. Even before last April, when the present Government published the Air craft and Shipbuilding Industries Bill outlining its plans to nationalise the industry (see Flight for May 8, leading article and page 721), the freezing of the HS.146 had highlighted the industry's medium-to-long-term problem— a chronic shortage of new production programmes. The Labour Government and most of the trade unions affected believe that nationalisation will secure the industry's future and help to guarantee a steady flow of investment funds. The SBAC, the Conservative opposition and rtiany other interested parties disagree. The result—in the short term at least—has been a virtual standstill in invest ment as a consequence of the Bill's requirement that all policy decisions which might affect compensation terms should now be referred to the Minister for Industry. Shadow of nationalisation Within the British aerospace industry, arguments about nationalisation largely overshadowed the run-up to the June referendum on the United Kingdom's continued mem bership of the European Economic Community and the resounding "Yes" vote which followed. After all, the aero space industry had pioneered co-operation with Europe and had encountered the subtle workings of European politics during the gestation, birth and development of Concorde. It seemed that confirmed membership would make very little practical difference. After the referendum Mr Anthony Wedgwood Benn, that strong advocate of nation alisation and worker's participation and a vocal anti- European, was switched from his post as Minister for Industry and replaced by Mr Eric Varley, formerly Minis ter for Energy. A tight Parliamentary timetable ostensibly caused delay—some thought it was to be an infinite delay—in the passage of the nationalisation Bill and for a while the Government was busy with its counter-inflation policy. At that point the industry seemed likely to escape nationalisation, just as it had escaped the former Conserva tive Government's plans to stage-manage a merger of the airframe interests of Hawker Siddeley and BAC. Despite current business-as-usual appearances, however, the next year could prove to be a watershed in the history of the British and European industries. First, the Govern ment seems to be determined to push through nationalisa tion. The Bill will be introduced during the next session of Parliament, which opens at the end of the year. The Organ ising Committee of the so-called British Aerospace Corpora tion, which will include union representation, is expected to be formed by June, following the second reading of the Bill. Additionally, the EEC has begun to adopt a more inter- ventionalist approach to aerospace and is expected to put forward its plans for the industry, which could be backed by Community investment funds and an export-import bank, later this month. What is worrying some senior executives in the British industry—and delighting their French opposite numbers—is that the Commission may be putting forward policies on the basis of a set of misleading statistics (see below). As the influence of the EEC Com mission grows, it will have an increasing effect on the shape of the UK aerospace industry. Organisational changes It is ironical that both British and European politicians should decide that now is the time to sponsor organisational changes to correct what they see as faults in past perform ance, just when the industry is looking to the politicians to make urgent decisions, not about the structure of the industry, but about the funding of the next generation of civil transports. In terms of manpower, remembering that each country uses a rather different method of head-counting, Britons account for about 50 per cent of the EEC countries' aero space workers and outnumber their French and German colleagues 2:1 and 4:1 respectively. According to EEC figures, since 1970 the workforce in West Germany has fallen from some 56,000 to a trough of 52,000 in 1972, increasing to 54,000 again in 1974. Numbers in the French industry peaked at 108,650 in 1971 and have since drifted down to a little over 106,000. Employment in the UK is slowly falling and could wind down rapidly if new orders are not received for civil aircraft such as the One-Eleven, Trident and Concorde. BAC and Hawker Siddeley have already adjusted themselves to a modest rate of civil transport production, however, and there are strong possibilities of repeat orders from China or its. neighbours for the Trident and from Bomania for the One-Eleven. In the United States aerospace is the largest manufacturing industry, employing a workforce of about 950,000, around two-and-a-half times the size of the EEC workforce; in 1969 the ratio was close to 3-5:1. Comparisons of sales are also made difficult by the lack of a consistent set of statistics but the EEC esti mates that in 1973 the US aerospace industry sold $24,280 million-worth of products, the EEC $7,150 million and the United Kingdom $2,450 million. The totals for employment used in Fig 2 are taken from the British Department of Employment Gazette and apply to the manufacturing side of the industry. While they in clude all those who work on the diverse activities reviewed on the following pages, they do not give a complete picture of the British capability. The chosen instrument of British air-transport policy, British Airways, is by far the biggest carrier in Europe and possesses considerable pur chasing power. As well as being a large exporter of revenue seat-miles, it carries out a great deal of contract , maintenance (see Flight for August 21, page 250) and pro vides management expertise to a number of overseas air lines. The London aviation-insurance market is the largest in the world and handles around 40 per cent of total busi ness. British companies have a large stake in brokerage and in leasing and selling second-hand aircraft. These aircraft may never appear on the British register but the transactions, often involving the complete staffing of a new airline, are very profitable for UK-based companies. Airport construction, mostly undertaken by companies in the civil- engineering sector, and aerospace consultancy (see Flight for September 26, 1974, page 371), usually carried out by small multi-disciplined teams, are among the other highly competitive aspects of the international aerospace business in which Britain has a world-wide reputation. One aspect of the all-round capability of the British industry is the range of activities undertaken by the Boyal Aircraft Establishment and the Boyal Badar Establishment (see page 477) under the aegis of the Ministry of Defence Procurement Executive. The largest establishment, Farn-
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