In 1973 the author first reported on the affairs of a then struggling and public policy driven Airbus Industrie and its ambitions to sell a then huge wide body twin engined shorter haul design called the A300.
The consortium was based from memory in temporary buildings near an orchard near Toulouse Blagnac airport. You could probably have come away with fruit as well as a story if you felt so inclined.
The popular perception was that the A300 would be a big fat version of the sometimes ridiculed but rather charming Dassault Mercure, of which 11 managed to perform revenue service for Air Inter as a single aisle but very fast flying alternative to a Boeing 737 and with slightly wider cabin dimensions.
The policy imperative behind the multi-national European venture was to retain if not expand the aerospace skills base of the states that bankrolled it.
Fast forward to 2013, and some time with Fabrice Brégier the President and CEO of Airbus, and Thierry Baril the chief HR officer for EADS and Airbus, as an invited guest at the annual Airbus Innovation Days.
The orchard and the demountables and the A300s are gone. The design of that first jet remains almost unrecognizably incorporated in the bloated structure of the specialist Beluga large component carrying freighters that bring sections of A350 fuselages to the final assembly line at Toulouse.
Baril is explaining to a table of reporters that Airbus, as a major and career rich industrial company in a devastated European economic landscape is primarily concerned with attracting and retaining talent and skills, in a company with no compulsory retirement age for the technologically significant positions, and a workforce of 60,000 of which only 2% leave through natural attrition annually.
“After considerable expansion of our numbers in the last three years we are stabilizing at an intake of 3000 this year, 1500 for replacement and 1500 for expansion,” he says.
He doesn’t discuss or compare the labour and career arrangements at Boeing. It’s all about finding and keeping good people whether young including from company sponsored training courses, or old, with decades of hands on, minds on engagement with aerospace ventures.
It is also about the EU’s heightened sensitivity to the value of companies that actually design and make things, rather than services industries like banking, some of which are variously broke or in disgrace, and mais non, M Baril did not articulate such thoughts in words thus blunt.
Fabrice Brégier is the antithesis of most airline and aerospace CEOs in the west.
He doesn’t identify with the language or terminology of business school or economic ideologies, although he wants a more hard headed decision making process in Airbus. He is unashamedly setting out to make Airbus more profitable than now, and to make it a business more efficiently using the design brilliance and innovations of its people.
But as an engineer he communicates with the design, engineering and innovative talent in their own terms, subject to the ‘new business imperatives.’
“We have a plan to dramatically improve profitability within two years” Brégier says.
The words are chosen carefully. Airbus works in English, however the invited media is from different linguistic communities, and may have different uses or weightings for the same words in English, so using the right words is something that is always carefully addressed.
Airbus, Brégier says, is not committed to being kept to its footprint in Europe in the face of opportunities presented by globalization. But it is committed to retaining its innovative edge, and keeping control over the structures and systems and their integration under the Airbus brand.
Who could he be referencing?
“We have no new business partnerships in mind” he says, “ but we know how to make partnerships work.” He cites the successful A320 final assembly line in Tianjin, China, and the forthcoming venture at Mobile, Alabama which will produce a finished A320 every week from about 2017.
He summarises what so far is a stellar year for Airbus in terms of sales and deliveries. The latter are up by 10% since January. It seems on track to outsell the unnamed competitor.
Airbus expects to soon win 50% of the enormous China market. But the issue between China and the EU over a form of carbon tax on non-EU carriers, including those from China, is not ready for discussion. It has been a barrier to realizing more China sales.
Brégier also says that Africa will in the next 10-15 years ‘grow as much as the Middle East, not necessarily through the same type of airliners bought by Gulf carriers’ but initially more of the smaller and medium sized short to long range airlines, meaning don’t expect huge orders for A380s.
However on the A380 he says ‘Would Boeing needs to develop the 777-X if the 747-8 was an effective competitor with our very large jet? No’.
Airbus may only have an ambition to sell between 25-30 A380s a year, but Boeings sales of the 747-8I are flat lining.
On the A350, Brégier says the plan to follow the current first version, the A350-900, with a higher capacity -1000 is comparatively low risk, as much of the development and design work has been carried in conjunction with the first model.
“I don’t need a brand new engine for the -1000” Bregier says,” because the Rolls-Royce new technology engines for the -900 are readily scalable to the power needed for the larger version.”
“I’m pretty sure Boeing will develop a good aircraft with the 777-X series, but they are responding to our successes [with the A380 and the impending A350s].
“Our one is a brand new design, the 777-X is a derivative. Which will be years later than the -1000 [due in service in 2017].”
Airbus said it has taken the innovative lead on the very large aircraft or VLA market with the A380, and set the pace with the new technology single aisle market, which is the major part of the revenue stream both Airbus and Boeing but coming out with the NEOs at least two years before the 737 MAXs.
It sees the A350 as preempting the 777-X, from below, while demand builds for the improved performance A380s which will take on the proposed new line of Boeings from above.
He also uses a new phrase that has been adopted by Airbus for the A330s, which the 787s were supposed to kill. “It is a regional wide body airliner”. One which has outsold the 787 five to one in the last few years, because it is available, reliable, and makes a heap of money for its operators.
Needless to say Boeing would contest these assertions, but today I’m contemplating where Airbus has come in four decades, and listening to it discuss where it is going.
What was inconceivable in 1973 (and for quite some time after that) has become an astonishing reality in 2013.