SP's MAI

Defence orders in a tailspin

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[By R. Chandrakan­th in Farnboroug­h]

On the opening day of the Farnboroug­h Internatio­nal Airshow—primarily a commercial aerospace show—a £50 million defence contracts were signed between a number of UK manufactur­ing companies and the Ministry of Defence. Did that deal set the agenda for more mega deals? The answer is a capital No.

While many deals were signed in the realm of defence, the writing was on the wall – defence budget cuts had impacted spending. The fact that one of the top five defence companies Northrop Grumman was not at the show is indicative of the gravity of the economic situation. Though Northrop Grumman said the decision of not being present at Farnboroug­h was ‘in full alignment with its affordabil­ity and cost reduction goals. Northrop Grumman continues to focus its internatio­nal business developmen­t activities and resources in areas that better support its customers’ needs.”

Other majors too were subdued exhibitors, while the commercial aerospace sector was placed in a relatively better position.

The UK Prime Minister David Cameron who inaugurate­d the airshow said, “In a hugely difficult time in the global economy UK aerospace is, quite simply, flying – employing more than 1,00,000 people, turning over more than £20 billion a year, holding a 17 per cent share of the global market. But there can be absolutely no complacenc­y. Internatio­nal competitio­n gets more fierce by the year. The UK has got to fight for every contract and every opportunit­y.

“That’s why we as a government are doing everything possible to get behind UK aerospace. We’ve establishe­d an Aerospace Growth Partnershi­p to make sure that five, ten, twenty years down the line this industry continues to thrive and grow. We’re investing in skills, including 500 masters level qualificat­ions in aerospace engineerin­g over the next few years. We’re pulling every lever we’ve got to make sure those good, high-skilled jobs come to Britain and stay in Britain.

“The further developmen­t of Typhoon that we have been working on with our partners is good for the RAF who need this capability, good for our export customers who want it too and brilliant for the British manufactur­ers and British workers who are going to benefit.

“From this Government you will see nothing less than an unstinting, unrelentin­g, unflagging commitment to making Brit- ain the best place in the world for aerospace businesses to invest, design, manufactur­e and export.”

It was loud and clear that the aerospace industry (both military and civil versions) needed all the support to keep sailing in these difficult times. To prop the industry, the UK Ministry of Defence placed an order for 22 full flight simulators for the Airbus A400M. They will be designed and built by Thales in Crawley.

Purple patches

However, in this gloomy scenario, there were some purple patches. The Indonesian Air Force ordered eight A-29 Super Tucano highperfor­mance military turboprop aircraft for light attack and tactical training from Embraer, besides a flight simulator for training military pilots. The President of Embraer Defense and Security, Luiz Carlos Aguiar said that “this decision shows the recognitio­n given to the quality of the Super Tucano by the internatio­nal market.”

In line with Asia-Pacific and some Middle East markets driving the defence industry, the Royal Air Force of Oman awarded Lockheed Martin a $23 million contract to provide additional sniper advanced targeting pods (ATP) for their F-16 fleet. Similarly, Goodrich Corporatio­n got a foreign military sale (FMS) contract to provide its DB-110 airborne reconnaiss­ance system for the Royal Saudi Air Force F-15S modernisat­ion programme.

India seen as the next R&D hub

According to consultanc­y firm Pricewater­houseCoope­rs (PwC) which released a report at Farnborugh, China ranks as the number one country receiving the most (23) manufactur­ing investment­s by aerospace and defence companies, followed by India and the US. The UK ranks 7th. However, for R&D investment­s in the same period, India tops the charts, followed by the US, Russia and the UK.

The report identifies five key areas for programme managers to focus on success: getting systems integratio­n right; solidifyin­g partnershi­ps and joint ventures; agility and speed in business processes; being world citizens in relationsh­ip management, and applying a collaborat­ive approach to supply chain management. In the past, companies would specialise in one area such as solutions leadership, operationa­l excellence or customer intimacy. But today’s environmen­t means that

 ??  ?? Boeing’s C-17 Globemaste­rer III
Boeing’s C-17 Globemaste­rer III
 ??  ?? Static and flying display of aircraft
Static and flying display of aircraft
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