Spain has come a long way as an aerospace nation thanks to European programmes. Now its ambition is to produce a tenth of Europe’s aerospace output
High-tech industry has been the saviour of Spain’s once ailing economy, with foreign investors such as Volkswagen in cars and international groups like Airbus bringing much-needed jobs and investment in technology. Now the country is setting its sights on producing a tenth of Europe’s aerospace output – its firms taking a larger slice, not just through old-fashioned industrial workshare, but by developing better technologies than their European competitors.
Spain’s big-ticket successes include a 10% share by Airbus España on the A380, its highest yet on an Airbus aircraft. The company will also be responsible for 30% of the systems on the Airbus Military A400M and 15% of its structure, including final assembly in Seville. As part of the Eurofighter Typhoon workshare package, Spain is responsible for building the right-side wings for all four countries’ aircraft, as well as final assembly of its own fighters. Eurocopter’s Spanish unit also has a stake in the Tiger attack helicopter programme, and Spain’s aeroengine company, ITP, builds part of the engines for all three military programmes. It is also a partner on the Rolls-Royce Trent civil engine family.
As a result, the country’s status in Europe’s aerospace rankings is rising, says Hernández. “In the recent past, we have been the fifth country, with double the turnover of Sweden and around half of Italy’s. Today, we are approaching Italy and far away from Sweden, and we are seen as being on a par with the big four [France, Germany, Italy and the UK],” he says.
Although Spain has a dynamic small and medium-size enterprises (SME) sector, the industry is dominated by six companies with more than 1,000 employees: Airbus España, EADS Casa, Gamesa Aeronautica in structures, Iberia Maintenance, systems specialist Indra and engine manufacturer ITP. There are a further six businesses with more than 250 staff and the rest are SMEs.
Spain has not been a particular target for investment by US or other foreign players, although Boeing has a small research and development centre in Madrid, and some Spanish manufacturers, including Gamesa, have been heavily involved in non-European programmes.
Until the late 1990s, CASA had been Spain’s national aerospace company, with its own range of small transport aircraft and a partner in the European Airbus consortium. With the integration of Airbus and the creation of EADS, CASA effectively split its business in two, merging its Airbus operations into the new Toulouse-based Airbus company and effectively becoming the Military Transport Aircraft division of EADS. Other CASA assets became part of other EADS divisions, such as Defence & Security Systems, Space and Eurocopter.
“We had to disintegrate and then re-integrate into the new EADS divisions,” says the veteran CASA boss Francisco Fernandez-Sainz, now president of EADS in Spain, as well as the EADS main board director responsible for military transport aircraft. “But the integration has worked very well, because we have been working with the same people for 20 years.”
Holding too low?
Not everyone has been delighted with the integration, and some feel the Spanish state’s holding of just over 5% in EADS (with shares owned by Spanish investors on the Madrid stock exchange pushing the national stake up slightly) is too low given what CASA’s technology and products have contributed. However, Fernandez-Sainz believes “it was fundamental for CASA to be integrated into EADS” and that it has “brought a lot of work into Spain”.
In the military market, the fact that the only national prime contractor can now offer a much wider range of solutions from across EADS’s portfolio means that Spain’s ministry of defence is happier dealing with the Spanish entity, says Fernandez-Sainz. “Spanish economic growth has given us an opportunity to spend more in defence and the government is willing to support the aeronautical business of EADS in Spain as its national champion,” he says. “Before, CASA was a thin leg. Now, with EADS,we are a fat leg.”
EADS and Airbus in Spain have a “responsibility to Spanish industry”, he says, and the proportion of materials Airbus sources from local companies has increased considerably from the 50% when he ran the airframer’s Spanish arm in the 1990s. But Spanish companies will only be selected for programmes if “they are good in terms of quality and cost”, he says. “They still have to earn their way on.”
Spanish industry, however, still faces a skills deficit and, as in elsewhere in Europe, recruitment of trained engineers is difficult. “There is a real shortage,” says ATECMA’s Hernández. “Aeronautical engineering has a reputation as a very difficult career that does not pay well enough to reflect the effort.” Recent graduates tempted by climate and lifestyle to relocate to Madrid or Seville also face a barrier. “The problem is speaking Spanish,” says Hernández. Because many educated Spaniards understand English and often French, moves are usually in the other direction, adding to the industry’s “brain drain”.
The country’s academic institutions have also had to catch up with the growth in demand for graduates. There was only one aerospace school in Madrid. Now new ones in Barcelona and Seville will soon be producing their first graduates.
Another problem has been bridging the gap between EADS and Airbus and their big systems-integrating suppliers on the one hand and SMEs on the other, many of which do not have the resources to invest in research and development of new technologies. Spain’s autonomous regions have played a part in addressing this, particularly the ones with a sizeable aerospace sector – Andalucia, the Basque country, Catalonia and Madrid (see P46). They have channelled funding and helped encourage local firms to pool their resources.
“In general, companies are very small, and to be competitive in a global market, they have to approach customers in clusters,” says Hernandez. “The local authorities are helping in this new way of approaching the market.” ■
MURDO MORRISON / MADRID
Source: Flight International