THE LONG FAREWELL
By Julian Nettlefold, Editor, BATTLESPACE
20 Sep 06. It was ironic that in the same week that BAE Systems confirmed that it would be selling its 20% stake in Airbus, thus ending U.K. involvement in commercial airliner production, that Chris Geoghegan, COO of BAE Systems should stand up and confirm the firm outlook for the industry and its sound future. Without the key shareholding BAE’s current activities would be vulnerable to takeover by other interested parties. This was confirmed later in the evening by Airbus U.K. MD Iain Gray. Indeed a great deal of the value in the BAE stake was enabled by direct U.K. Government loan money so one would have expected that the Company would respect that and plough the money back into the U.K. But, BAE is expcted to buy a company in the U.S.A. rumoured to be SAIC.
He said, “At last year’s dinner you may remember I said that we don’t do enough to tell people about the importance of our industry or to trumpet its achievements. I feel we have started to put that right. Aerospace is a UK success story and more people are beginning to understand that and I genuinely believe more people in government today are prepared to listen to the message.”
There were no Government Ministers there to listen to this message, hence the usual disdain for the industry expressed from the top down. However he did say that the Prime Minster had expressed ‘joy at being able to go to Farnborough to see the A380 and get out of the office.’ At Farnborough 2008 he will be able to visit every day as he will have more spare time!
‘Earlier this year SBAC reported on a phenomenal performance by industry. Turnover had increased by 25 per cent to nearly £23bn, new orders hit a record high of more than £30bn and £2.7bn had been invested in R&D. Add to that, global exports of more than £15bn and you have a pretty good picture of a globally competitive and nationally significant industrial sector.’
That was this year, but with A380 and A350 delays, delays expected in A400M and no new military programmes expected, the next few years look leaner prior to the pick-up expected for the 787.
‘The development and implementation of Defence Industrial Strategy (DIS) is probably the most significant policy issue involving the sector. The launch of DIS at the end of 2005 was well received by industry. The concept of “appropriate sovereignty” and the need to maintain a viable industrial base here in the UK to support the Armed Forces were warmly welcomed by all.
I think we we’re all heartened by the language used in the DIS. Finally the recognition that a profitable and successful industry was not a bad thing, even more that it was necessary and desirable. Similarly it was refreshing to see a policy based upon a more open and transparent approach to establishing future military requirements.’
Here was a perfect platform to question parts of the DIS. He never questioned the statement in the DIS that no manned aircraft would be built in the U.K., a throwback to the Duncan Sandys days of 1956.
When the Editor was asked by the SBAC what his comments were on this speech he said exactly the above and the level of R&D spend. He was rebuked by the SBAC to say that it was not set in stone and he should stop being like Victor Meldrew! Did Chris Geoghegan ever question this statement in his speech and the impact it would have on the industry, no. (See: BATTLESPACE UPDATE Vol.8 ISSUE 34, 23 August 2006, ONE SPACE LEFT – A REQUIEM TO A DYNAMIC INDUSTRY By Julian Nettlefold, Editor, BATTLESPACE). The trouble is with a Government and an Opposition lacking any key industrial players, this trend may become policy sooner rather than later.
‘The next six to twelve months will be crucial for DIS and the future of the UK industrial base. As the various strands of the MOD change programme are pulled together, industry will need to step up its act and improve its engagement. The principle focus for the collective