The UK aerospace and defence sector enjoyed a record year last year, with industry pundits predicting the boom times will be here for a while.
The UK currently controls 17 per cent of the sector’s market share – second only to the US. “We are in a global growth market which could top £3.6 trillion over the next 20 years. That’s 58,000 aircraft, so retaining our market share is clearly good news for the UK and for employment,” said Paul Everitt, chief executive of the industry representative group ADS. “It is a huge opportunity.”
ADS data revealed UK companies have delivered 446 commercial aircraft in the year to date, in deals worth approximately £7.5bn – a 16 per cent increase on the previous year.
According to consultancy firm AlixPartners, these gains are being driven by falling oil prices, low interest rates and improving economic growth, with demand for more fuel-efficient aircraft driving civil aviation backlogs to an all time high.
“With the continuing boom in commercial aerospace, the UK supply chain that supports the leading original equipment manufacturers is benefiting from growing order books,” said Jeremy Berwick, aerospace and defence leader at Deloitte, who added the main challenge will be keeping up with demand.
But dangers for the sector remain, with the spectre of a Brexit hanging over the industry. A survey conducted by KPMG of the 900 member firms which comprise ADS revealed 86 per cent of respondents believe it would be better for their business for the UK to remain in the EU.
Nigel Stein, chief executive of GKN said: “Membership of the EU gives the opportunity to participate in setting regulation, which will impact the industry, irrespective of membership.”
Industry gets ready for famous Paris Air Show jamboree
With the Paris Air Show due to kick off on Monday, representatives from the global aerospace industry will be turning up en masse with a spring in their step after experiencing the best year on record. Visitors will get to experience 2,260 exhibitors from 47 countries, displaying 120 aircraft, over the course of the six- day event. Jets on display will include the Boeing F15 Strike Eagle, the Dassault Rafale and the new Airbus E-Fan 2.0 electric prototype.
The spectacle is taking place after figures revealed the profitability of the top 100 global companies in the industry reached a record level in 2014 to beyond 10 per cent EBIT margin. Profits have helped drive a resurgence in merger activity in the sector, which topped $41bn (£26.1bn).
First founded in 1908, the air show has been the venue of choice for many companies to debut their aircrafts. Over the years they have included the Airbus A380, the American A117 stealth bomber and the Russian Antonov 225, the longest and heaviest aircraft in the world, which was demonstrated with the space shuttle Buran mounted on top. Those visitors thinking of finding a job in the sector are in luck too, with an employment forum waiting to recruit.