‘‘THE PLANT AT EL PUERTO DE SANTA MARÍA IS AN ESSENTIAL LINk IN OUR SUPPLY CHAIN AND NO DECISIONS HAvE BEEN MADE WHICH AffECT ITS fUTURE’’.
A year after his appointment as CEO of Airbus Military and the integration of the company in Airbus, Domingo Ureña recaps the main issues for the international and Andalusian aeronautical sector at the current time, along with the success of the flight test campaign of the A400M, the bid by EADS in the tender for the new U.S. Air force tanker and the future of the company’s plants in Andalusia, ruling out the possibility of concentrating its facilities in Seville
What is the current situation of the negotiations regarding the contract for the A400M following the principle agreement reached in March with the customer nations?
The conversations continue. They are going slower then we would like, but we are now clearing up the final details. The principle agreement in March established that apart from the 2 billion additional euros which would be provided by the nations participating in the launch of the A400M, another 1.5 billion euros would be provided in exchange for a share in future exports of the aircraft. Another issue which is being discussed is the reduction of the initial order of 180 aircraft to 170. The conversations are still in progress, although I cannot elaborate any further at this stage.
In 2009 EADS posted a loss due to provisions for the A400M programme; will the ledgers be balanced with the start of the deliveries of orders for the aircraft?
Airbus Military is a solid company with a consolidated portfolio of products and customers. The launch of a new aircraft requires an enormous effort in terms of the development of engineering for the new product. In addition, the A400M makes a qualitative leap which signifies a veritable technological revolution, and as such it is evident that significant resources and equally significant efforts must be made for its development. What I want to make clear in saying this is that Airbus Military is a profitable company if we do not take into account the A400M programme. The firts mass production phase assembly will begin at the end of the year. That will be the time when we start to reap the rewards for the economic commitment the group has made to this programme, which due to its quality will last for various decades. We are talking about the airlifter for military, civil and humanitarian missions of the 21st century. And that is exactly what it is, not just in terms of image but because it truly meets the existing and future needs of our customers. Accordingly, the answer to your question is yes, the A400M will be a profitable programme in the near future.
What is the significance of the contract for eight CN235s for France?
First of all, it represents further confirmation of the quality of our products. Every time a customer purchases one of our aircraft, this tells us that what we are offering meets their needs and they have chosen us because we have the best existing product in that class. Every time a customer makes an order, every member of the Airbus Military team receives a pat on the back for the good work they have done and for them to continue in this direction. These eight aircraft will be incorporated into our portfolio of orders and also those of the auxiliary companies which collaborate with us. Every sale we make signifies a distribution of wealth deriving from the exterior and will also benefit a significant number of Andalusian companies. Also important is the innovation and know-how which is generated by each new contract and which forms the basis of the industry in the future.
Do you expect there to be similar additional orders by other customers of the A400M?
That will depend upon our customers. If they consider that they require light or medium-sized military transport aircraft, our C295s, Cn235s and C212s are the best option on the market and we will be delighted to take on their orders. The first two A400Ms are now flying almost daily, the third will start the flight test campaign at the beginning of summer and the fourth will do so before the end of the year.
Are we witnessing a historic milestone for European aeronautics?
Without a doubt. Without considering the political relevance of the fact that so many nations have come together to launch a common aircraft, the A400M is a turning point in the history of aeronautical manufacture. I mentioned that it comprises a technological revolution for the sector, but in addition the design as a whole is impeccable. This is evident from the fact that its pilots have indicated it flies even better than in the simulator. It has brought Seville a final assembly line of a magnitude unknown until now in Spain; it has led to the start-up in the capital of the Group’s second Flight Test Centre after Toulouse, with all the technology and know-how that this entails; and it will provide our customers with the most innovative and versatile aircraft ever built.
What is the role of Andalusian firms in the sector collaborating on the A400M?
Their participation accounts for 46% of all the jobs subcontracted in Spain. The following region in terms of volume of contracts is Madrid, with 34%. All these jobs are related with the horizontal tail plane, the fairings flaps and the power plant, essentially everything attached to the wing apart from the engine.
Is Airbus Military looking into the development of a mediumsized military airlifter between the A400M and the C295?
not at the moment. However, we will readily look into this if we establish that there is a demand for such an aircraft on the market.
What technology is used by the different light and medium-sized airlifters offered by Airbus Military?
Our family of light and mediumsized airlifters (C295, Cn235 and C212) are the best of their type currently available. They are solid aircraft designed to operate in all kinds of adverse conditions and they are incredibly reliable. That in itself is a magnificent product description, but even more outstanding is the versatility which the engineering department of Airbus Military has granted these three models. All three aircraft originated as airlifters, but each of them currently has a maritime patrol version which, in addition, is offered to our customers with different configurations so that they can choose that which best meets their needs. An example is the coast guard version of the Cn235, three units of which will have been delivered by the end of the year to the U.S. Coast Guard. Similarly, recently we delivered a C295 equipped with anti-submarine warfare systems which can be used by naval forces to update ageing fleets. The FITS mission system which we have developed and which we offer for these aircraft enables control of borders, immigration, drug trafficking and illegal fishing and search and rescue missions, to name a few possibilities. This capacity to offer so many different versions must require significant engineering resources. Indeed. We need an extensive team of engineers to provide the solutions to each of our customers’ needs. Our final assembly line for light and medium-sized airlifters is very different to an industrial assembly line where the end product is always the same. We build aircraft which are made-tomeasure according to the needs of our customers, which requires a significant engineering effort. This is also the case of the logistics: in order to deliver an aircraft every ten days, after one aircraft leaves the plant work must begin on the next one, and it may have a totally different configuration which will require us to change much of the associated organisational infrastructure. Our colleagues in Seville know how to assume these challenges. In fact, this Andalusian city has a unique characteristic which makes it one of the leading sites in the industry: the three plants which Airbus Military has in Seville cover all the different fields of the aeronautical sector, from engineering development through to manufacture, assembly, flight tests, delivery to customers, the crew training and post-sales services. In January the new facilities of the Services Centre you have referred to were inaugurated.
Will Airbus Military be responsible for the maintenance of the A400M in the future?
Airbus Military will be the reference company for the maintenance of the A400M and the one in Seville will be one of the main centres for this activity. We are creating a network of MRO (Maintenance, Repair and Overhaul) service centres, including leading aeronautical centres. Seville is one of these, and another one is located in Mobile, in the USA. We are also currently working to open further centres in Europe, the Far East and South America. Each of these will provide coverage of their market zone for the entire range of Airbus Military products. In addition, we are also making very interesting offers of comprehensive services, for the FSTA in the United Kingdom, for example. We created the AirTanker company together with other industrial partners, through which we will provide comprehensive maintenance services for A330 MRTTs in the United Kingdom, as well as the operation of non-military missions. In other words, our crews will be responsible for flying on missions of a non-military nature. Services are an important business area and we have established the objective of dedicating 25% of the company’s activity to this area by 2020.
In the end the company will be participating in the tender to supply the aerial refuelling tankers for the U.S. Air Force. How is the A330 MRTT by Airbus Military different to the aircraft being offered by Boeing in this tender?
The main difference is that our A330 MRTT (Multi-Role Tanker Transport) is already flying and our competitor is still in the development phase. Boeing is still at the stage of working with the design team on the computer, while our A330 MRTT already has civil certification from European authorities and only lacks military certification, which it will have shortly. Their aircraft is still on the drawing board and our A330 MRTT has already achieved various milestones such as the aerial refuelling of two fighters at the same time and the refuelling of one MRTT from another MRTT carried out in May. In general, our product is very advanced. We have won all the tenders we have participated in. It’s a fantastic aircraft and, frankly, it is better than our competitor. It is this certainty which has led us to remain in the tender for this contract with the U.S. Air Force.
What kind of participation will Andalusia have in the programme for this aerial refuelling tanker?
Andalusian plants will have a crucial role in the production of this aircraft. The Tablada factory in Seville will be responsible for the final fitting out of the boom, a refuelling system which has been developed by our design team and which signifies a major market innovation. This tanker can be equipped with three fuel transfer points, two on the wings using the probe and drogue system, and a third which comprises the boom system.
What is the position of the production plant at Puerto Real (Cádiz) in the manufacturing process of Airbus products?
Our site at Puerto Real is participating in all the twin-aisle civil programmes for Airbus, from the A330 through to the A380, carrying out integration of the horizontal tail plane and assembly of the belly fairing. In addition, towards the end of the year production will begin for the lateral boxes of the horizontal tail plane for the A350, Airbus' new airliner with an extrawide fuselage. This is the first aircraft to be made with more than 50% composite materials, which considerably reduces its weight and enables significant fuel savings, reducing both operating costs and environmental impact. The main client of the Puerto Real plant is the site in Getafe, which carries out integration of the structures manufactured at the Cádiz plant with the exception of the horizontal tail plane and belly fairing for the A380, which are sent directly to the final assembly line in Toulouse. With regard to the company's other site in Cádiz, there has been much talk in the press regarding the future of the Bahía de Cádiz Plant in El Puerto de Santa María and even the possibility of concentrating the plants in Seville. Yes, there has been much talk about this, and it is all misguided. There has been no new development affecting the plant and the situation is the same as last year. no decision has been made which affects its future and it continues to be an essential link in the supply chain for our final assembly lines. In any event, any alternative which may be taken into consideration would be subject to extensive discussion with the relevant social actors. With respect to the second part of your question, there is no intention to concentrate the plants in Seville.
In what areas do Andalusian companies need to improve in order to compete with other European aeronautical centres, and above all, Asian centres (such as China)?
All companies, including Andalusian companies, are faced with the daily challenge of being as competitive as possible. That is the only way to offer the best product at the best price. Two of the keys in order to achieve this goal are innovation and productivity, keeping these two aspects alive and not allowing them to stagnate with development through continuous growth. The 7,9% increase in productivity in the Andalusian auxiliary aeronautical industry in 2009 might be considered to be an acceptable figure for a sector which is not as highly competitive as the aeronautical sector. However, if Andalusian companies want to compete with emerging industries, they will have to step up the pace if they do not want to be left behind and lose their position at the forefront of the industry.
When will the new Airbus Military Training Centre in Seville open its doors?
Very soon, at the end of the summer which has just begun. The works have now been completed and we are fitting out the facilities so that we can start the first courses. In February the new C295 flight simulator which we have just purchased was installed and in the coming weeks we will transfer the Cn235 simulator which we have at the San Pablo norte Training Centre. The A400M Simulator will arrive some months before the first delivery to customers, so that the crew will have enough time to receive their training. And we still have three further bays for the installation of other similar simulators. We are actually very satisfied with these new facilities, which enable us to position ourselves as leaders in this field as well.
How would you evaluate your first year at the helm of Airbus Military?
Last April was the first anniversary of the integration of Airbus Military and I can assure you that these 12 months have involved various moments of satisfaction. The greatest of these was undoubtedly the maiden flight of the A400M last December. nonetheless, this does not detract from the other achievements made. The tanker certification campaign, as I have mentioned previously, has made major advances and is about to be completed. The flight tests for the A400M have demonstrated that we have created an exceptional aircraft which flies even better than the simulations had indicated. Our family of light and medium-sized aircraft is maintaining its position as the leader of its market sector and we are continuing to develop new versions. It has been a year of many successes and they have only been possible thanks to the extraordinary team at Airbus Military.
What is the outlook for the sector for the second half of 2010 and in 2011?
During this year and a half we need to continue working and doing things even better than we did last year. We can’t settle for doing things well; in the future we will do them even better. With this maxim in mind we will continue on the path which we started out on a year ago now, standing on the shoulders of the giants who have come before us. Our customers are, generally speaking, governments. It is public knowledge that the economic crisis has led them to make cutbacks in their expenses, and evidently this may have an impact on the contracts which are signed in the coming months. However, Airbus Military has an excellent portfolio of customers and orders, as I indicated previously, which means that we have many years of guaranteed work. And that is the case because our customers know that we offer them the very best product available.