midlands aerospeac€¦ · aero engine controls set to invest in £60m state- ... maa-ukti trade...

Midlands

AerospAce

r&D LIGHT sHINes BrIGHTer

FLYING THe FLAG AT pArIs?

INs AND oUTs oF BorroWING

coNFereNce sUccess sTorY

MAA members gear up for Paris Airshow – P6

What financiers look for before they lend – P10

Delegates back return of MAA event – P2

M A G A Z I N EISSUE 32. SPRING 2013

NEW TECHNOLOGY FUNDING FOR AEROSPACE SUPPLY CHAIN ANTICIPATED, PAGE 4

02 Midlands aEROsPaCE

Update OnlinE: WWW.MIDLANDSAEROSPACE.ORG.UK/NEWS

COntinuEd On Pg 4

A £2bn investment in UK aerospace R&D, announced in March, is welcome news to the industry and

a good outcome for the Aerospace Growth Partnership (AGP), the joint government-industry body set up last year to look into ways of developing the UK’s aerospace sector.

The funding is to be provided over seven years under the Aerospace Industrial Strategy (AIS), mainly to finance a UK Aerospace Technology Institute (ATI) designed to support efforts by academic researchers

and industry to develop technology for the next generation of quieter, greener and more fuel-efficient aircraft.

The government’s investment of more than £1bn will be matched by industry.

“We’re doing all we can to maintain this jewel in our crown,” said Deputy Prime Minister Nick Clegg. The AIS, he added, was a “unique long-term strategy to maintain Britain’s position as the centre of aerospace technology”.

Emma Reynolds, Labour MP for

Wolverhampton North East and Chair of the Commons All-Party Group on aerospace, applauded the development. “Researching, designing and building the next generation of aircraft requires long-term, sustained investment and cross-party support. I welcome the government’s commitment.”

Details of the ATI, including where its small core team of 30-50 staff will be located, have yet to be worked out. It has the backing of major aerospace players, including

GoVerNMeNT BAcKs sTrATeGYWITH £2 BN IN r&D FUNDING

The MAA’s first annual aerospace conference was an overwhelming

success, drawing praise from the 160 attendees and support for more such events.

MAA members and industry representatives who packed Rolls-Royce’s Derby Learning and Career Development Centre on 20 February used words such as informative, fascinating, useful and thought-provoking to describe the event – the biggest-ever for the MAA.

“It was good to be given a snapshot of what our customers really see, what (potentially) our government intends to do to develop our industry, and what the future may hold,” said one delegate. Added another: “It was great to see the ‘helicopter view’ from the primes and good for us to mix with a variety of firms to understand some of the challenges.”

With its theme of ‘the visions and volumes every aerospace supplier needs to know’, the

conference offered Midlands supply chain companies access to vital knowledge to help them plan their next business moves.

The keynote speakers – Marcus Bryson, president and chief executive, GKN Aerospace; Pernille Boisen, chief procurement officer, Rolls-Royce; Richard Aboulafia, vice-president analysis, Teal Group; David Hygate, director, Europe, TeamSAI; and Clive Lewis, managing partner,

Achieving the Difference LLP – provided insights from their unique perspectives.

MAA operations manager Anne Esterson said the response of delegates was “encouraging” and suggestions would be taken into account during planning for the 2014 event. The date will be announced as soon as it is decided.

recorD eVeNT pAVes WAY For 2014 repeAT

www.midlandsaerospace. org.uk

Midlands aEROsPaCE 03

AERO ENGINE CONTROLS SET TO INVEST IN £60M STATE- OF-THE-ART MANUFACTURING FACILITY IN MIDLANDS

TrADe MIssIoN opeNs Doors IN ITALY

NeW Aec pLANT GeTs Go-AHeAD

Aero Engine Controls (AEC) has received the go-ahead for its new advanced manufacturing and technology

facility in the Midlands.AEC, part of the Rolls-Royce Group,

plans to invest £60 million to develop a 250,000 sq ft state-of-the-art facility at Birmingham Business Park, Solihull.

Design, development, manufacturing and testing capabilities for AEC’s leading engine control systems technology will be incorporated at the headquarters site, with associated expansion space. AEC intends to relocate its staff of more than 1,100 during 2014.

AEC chief executive Simon Burr was “delighted” to receive planning approval

for development of the site. ”This is fantastic news for everybody at AEC and we can now look towards growing the business for the future.

“Having our design and manufacturing operations under one roof, combined with more space and a state-of-the-art facility will allow us to be much more efficient and strengthen our ability to attract employees.”

Caroline Spelman, MP for Meriden, said the news underlines “the confidence of business to invest in the potential of our area with its history of skilled manufacturing and convenient location.”

NeWsMAA cLUsTers IN eUrope

ON THE wEb

➔ Meggitt is to provide thermal man-agement products for various LEAP engines under a £115m con-tract from Snecma.

➔ Invotec Group and Trimite Technologies have both received the bronze SC21 award.

➔ banbury-based tool manufacturer Norbar Torque tripled its exports to Japan in 2012.

➔ Advanced chemical etching has doubled its manufac-turing capacity with an investment of over £1 million.

➔ Atlas composites has been acquired by international manufacturing group Senior plc.

MAA members who took part in an MAA-UKTI trade mission to Turin and Milan in May have rated the initiative

an outstanding success, providing them with high-level contacts and good quality information that they would have found difficult to gain independently.

“Everywhere we visited, we were welcomed with open arms and at levels within the businesses that we would not normally be able to access,” said one of the 10 members.

The MAA-UKTI trade mission, organised in collaboration with the Torino-Piemonte and

The MAA is helping set up a network of European aerospace clusters called TransNetAero. Led by the German Aerospace Academy in Stuttgart, the heterogeneous grouping includes two small countries, Netherlands and Switzerland, and two other regions, Wallonia in Belgium and Normandy, France’s third largest aerospace cluster. The idea is to use support from the EU’s Interreg fund to help smaller companies in each region access knowledge about customer requirements, technology expertise and training from the others – to make a cluster of clusters! More news to follow. www.aeroenginecontrols.com

CLICk THROUGH TO THE MAA wEbSITE FOR CURRENT NEwS ON MEMbERS’ ACTIVITIES:

www.midlands aerospace.org.uk/news

Artist’s impression of Aero Engine Controls’ new headquarters in the Midlands.

Lombardy aerospace clusters, introduced a representative group of Midlands suppliers to the purchasing teams at Alenia Aermacchi, AgustaWestland, Avio, UTC Aerospace Systems (Microtecnica) and Secondo Mona.

Discussions at Microtecnica.

The MAA participants held a total of more than 20 hours of one-to-one meetings with 17 procurement leaders at the five companies, gained insights into their purchasing challenges and strategies, toured factories, visited new technology projects and networked with the Italian cluster hosts.

Participants commended the mission. “Meetings with such companies would be difficult to achieve independently,” said one. “From a strategic perspective the area, clusters and companies visited were a good fit,” commented another.


coVer sTorYINNOVATION IN R&D FUNDING

Airbus, Rolls-Royce, Messier-Dowty, AgustaWestland and GKN Aerospace.

A government press release said the research activity will focus largely on four key, high-value areas of aerospace technology in which the UK

excels – wings, engines, aerostructures and advanced systems – firmly targeting the aircraft of the future.

Government funding for the ATI will reach £150 million annually by 2014/15. The government estimates up to 230,000 high-value jobs in aerospace and its

supply chain will be sustained in the long term.

The MAA has been fully involved in the AGP, on behalf of its members, to create this new industrial strategy for UK aerospace which supports companies at all levels of the supply chain.

As the industry-government partnership

responsible for the new Aerospace Industrial Strategy ‘Lifting Off’, the Aerospace Growth Partnership (AGP) recognises that the larger companies acting alone will

not be able to make the technology advances required to sustain the UK’s market position in global aerospace markets.

To remain competitive, many aerospace suppliers need to move up the value chain and innovate new technologies at a rate greater than our competitors.

A step change towards an ‘R&D supply chain’ is required – but the market is not creating this with sufficient urgency.

The AGP therefore plans to accelerate the availability of market-ready, innovative technologies within the supply chain, for prime and first-tier manufacturers in the UK and overseas to incorporate into future aircraft and engines.

The idea is that by bringing together industry and

INJecTING r&D To BoosT sUppLY cHAINA SUCCESSFUL MAA PROGRAMME FOR SUPPLIERS IS bEING TRANSFERRED TO THE NATIONAL STAGE wITH THE IMMINENT LAUNCH OF THE NATIONAL AEROSPACE TECHNOLOGY ExPLOITATION PROGRAMME (NATEP).

Springs play an integral role in today’s advanced aircraft systems, yet spring manufacturers have traditionally had little

input into the design of those systems. This has led to sub-optimal systems design -- and

systems like actuators that are larger and heavier than they need to be.

SME G&O Springs took advantage of R&D funding offered through the Midlands Aerospace Alliance’s Aerospace Technology Exploitation Programme (part funded by the European Regional Development Fund) to collaboratively research more effective product solutions. They brought together Reliable Spring & Manufacturing Co (a fellow local spring maker), Alloy wire (a material provider) and the Institute of Spring Technology, together with Aero Engine Controls and bAE Systems as customer advisors.

The team manufactured a large number of

COntinuEd fROM Pg 3GoVerNMeNT BAcKs sTrATeGYWITH £2BN IN r&D FUNDING

CasE studY NeW cApABILITIes sprING INTo AcTIoN IN THe AerospAce sUppLY cHAIN


strength in unityA REVITALISED FEDERATION OF REGIONAL Uk AEROSPACE ORGANISATIONS TOGETHER wITH NATIONAL bODY ADS IS A STEP IN THE RIGHT DIRECTION, SAYS MARTIN wRIGHT, CHIEF ExECUTIVE OF THE NORTH wEST AEROSPACE ALLIANCE.

Despite being a relatively small country in physical size, we have the second largest aerospace and

defence industry in the world.Just like France and Germany, both

of which are bigger, we have relied on strong regional clusters to underpin the strength of our national industry. North west, South west, Midlands, South East, wales, Northern Ireland and Scotland all have aerospace clusters serviced by cluster organisations and the national body, ADS.

Clusters are what they say they are: centres of industry whose location and concentration of skills is largely a matter of history. Cluster organisations work. They can organise local events, address regional issues, engage regional government and so on.

There is a ‘however’ coming.we have a national policy and national governments are less

focused on regions, more on overall capability. In this respect, the compactness of the Uk should give

us an advantage. we should be able to use the proximity of our clusters to develop a high level, efficient interaction between these centres of excellence to the advantage of whole Uk capability.

That is exactly what the cluster organisations have been working toward for the last two years or so, under the chairmanship of ADS. They have been meeting to develop a far more collaborative approach.

The Aerospace Growth Partnership (AGP) framework for developing a long-term aerospace strategy, announced at the last Farnborough, has spurred a much more pragmatic approach to cluster collaboration.

The Uk Aerospace Federation, as this group calls itself, is making real progress in maximising regional cluster strengths to leverage the industry’s position as a top Uk government priority. NATEP (see left) represents a big change towards working hand in hand to boost companies in our clusters across the country.

Doing this under the AGP strategy lets us take a decisive step above and beyond a level of inter-regional collaboration that is less than good for the national interest.

There is much to celebrate in our regions and what they have achieved independently. The Federation plans to develop a web presence to promote the Uk’s collective capability through its regional clusters. Today we face huge skills and technology investment challenges that will only be resolved through a Uk-wide collaborative approach that maximises regional strengths.

we have a collective spirit after a cautious start. we can’t let it slip.

“There is a huge opportunity for the UK to benefit from the forecast growth in aerospace,” said MAA chief executive Dr Andrew Mair. As well as the £2bn for technology development, the AIS also sets out actions for building UK manufacturing capability, skills and the

competiveness of the supply chain. “All are critical to grasping future growth opportunities.” >The strategy can be downloaded here:www.gov.uk/government/publications/lifting-off-implementing-the-strategic-vision-for-uk-aerospace

government we can foster the development of vital new technologies -- with the primes and first-tiers also providing mentoring and expertise to encourage innovation from within the supply chain.

By developing a supply chain with a high rate of innovation, rich in new technologies, the AGP vision is for the UK to be better able to offer the right products and services, at the right time and ahead of competition.

We can ensure that global aerospace market opportunities are exploited to the maximum extent, with high value manufacturing work retained in the UK.

This is where the National Aerospace Technology Exploitation Programme (NATEP) will come in, to help

supply chain companies develop 100 innovative technologies and so increase their ability to win new business with higher tier companies anywhere in the world.

NATEP will build on the successful regional aerospace technology exploitation programme previously run in the Midlands (see case study). The government’s Advanced Manufacturing Supply Chain Initiative provides the opportunity to take this strategy forward.> It is planned to launch NATEP imminently. See www.midlandsaerospace.org.uk for details.

Cover photo: Meggitt engineer Steve Hughes examines a new technology concept developed with suppliers and University of birmingham under Midlands ATEP.

CasE studY NeW cApABILITIes sprING INTo AcTIoN IN THe AerospAce sUppLY cHAINsprings in 10 different titanium and exotic alloy grades and tested them rigorously. The results were fed into computer models to project how differently designed springs made from different materials would perform in various conditions. As a result, aircraft systems makers can now be provided with the data they need to specify the optimal spring for their systems, allowing them to make significant reductions in spring and system size and weight without compromising on performance and reliability.

This has enabled G&O Springs and its collaborators to move up the value chain, now possessing differentiating intellectual property and design expertise which is being used to win new export customers and new business in North America and Europe.

Pictured left: innovative software developed under the ATEP project enables designers to model the performance of springs in different materials under various conditions.


pArIs AIrsHoW 201317-23 JUNE 2013, PARIS LE bOURGET

Implications of AGp

A British Airways Airbus A380 could be a featured guest at the Paris Airshow in June.

As Midlands Aerospace magazine went to press, observers remained hopeful that BA management would agree to send one of their newly-painted A380s to the airshow from 17-23 June.

Although BA is scheduled to take delivery of its first A380 only in July, the first examples in fresh BA livery have already been rolled out at the Airbus paintshop in Hamburg.

If BA agreed, one of its new fleet – destined for long-haul services between London and Los Angeles and Hong Kong – could find itself gracing the skies above Le Bourget in the daily flying displays. A BA source told Flight Global that the airline had received a request and “we’re looking at it.”

British companies are already assured a strong presence at this year’s Paris show – the 50th edition of one of the world’s biggest and best marketplaces for aerospace.

The MAA returns with 10 members (see opposite page) who will be exhibiting on Stand G158 in Hall 2B as part of the ADS-managed UK Pavilion.

If previous shows are anything to go by, Midlands exhibitors will return with expressions of interest and new contacts to follow up in the months ahead.

After the last show, one MAA member said: “The organisation, help and service from the MAA team was excellent. We had

some really good enquiries both from the MAA stand and possible new customers.” Another remarked that the stand “was well positioned and it attracted a lot of visitors.”

The MAA members will be among 2,100 exhibitors

at this year’s Paris show, which organisers expect will attract more than 350,000 visitors.

“Our exhibitors tell us that the quality of visitor they meet at the Paris show makes it worth their while to be there,” says marketing manager Emma Burgess. “It’s definitely one of the highlights of our year.”

IcING oN THe cAKe?

wILL THE bRITISH PRESENCE IN JUNE’S PARIS AIRSHOw ExHIbITION HALLS bE MATCHED bY A STRONG FLYING DISPLAY?

www.midlandsaerospace.org.uk


abbey Metal finishing Co ltdAbbey Metal Finishing undertakes a wide range of finishing operations on machined and formed parts at its state-of-the-art Midlands facility. These operations include plating, painting, anodising, NDT and thermal spraying. The wide process range available enables multiple finishing operations to be undertaken consecutively, at one location, thereby minimising lead times and meeting the increasingly stringent customer demands in aerospace for QCDR. Contact: Mike Beirns – [email protected]

Consult avila ltdConsult Avila is a well-established business consultancy with a solid reputation for delivering real solutions, real results at pace. Its team of management professionals has a track record of achievement in the aerospace and defence sectors, providing support to clients through the entire process of change. ConsultAvila specialises in the following services: business transformation; working capital optimisation; strategic sourcing; sales, inventory & operations planning; performance improvement; and leadership development. Contact: Dudley Wood – [email protected]

Maycast nokes Precision EngineeringMaycast-Nokes Precision Engineering specialises in the manufacture of high quality precision castings. Operating from a single modern site, we are able to work from fully dimensioned 2D drawings or 3D CAD models and, using rapid prototyping techniques, we can supply castings on short lead times for initial trials or fit, form and function tests. We can then supply production quantities, from hard tooling, of machined, finished and assembled castings. Contact: Dave Blower – [email protected]

delcam PlcThe aerospace industry demands the highest levels of quality and consistency, plus cost-effective production and the shortest possible delivery times. Delcam’s wide range of manufacturing software and services helps companies meet those requirements. Delcam’s CADCAM systems have been used on virtually every major aircraft programme in recent years and in many MRO operations. Our customers have undertaken projects in all the areas that go towards producing a successful aircraft. Contact: Sarah Hanson – [email protected]

Osborn Metals ltdOsborn Metals is a UK-headquartered manufacturer, producing special extruded solid and hollow profiles in all grades of steel and titanium; sections used in both airframe and engine; low-cost tooling and flexible on quantities; cold drawn precision profiles in carbon and alloy steels; cold drawn precision tubing in carbon and alloy steels used in applications such as aircraft structures, helicopter undercarriage and driveshafts and roll cages. Contact: Richard Towers – [email protected]

Paul fabrications ltdPaul Fabrications manufactures complex fabricated and machined assemblies for the aerospace, industrial power generation and nuclear power sectors. Operating from a modern 60,000 sq ft facility, the company prides itself on exceeding customers’ expectations, drawing on an impressive breadth of engineering capability. In support of its multiple sector approvals, Paul Fabs has an ongoing commitment to investment that ensures the latest manufacturing technologies are utilised. Contact: Kevin Dexter – [email protected]

sigma Precision Components uK ltdSigma manufactures rigid pipe assemblies, precision machined components and fasteners for aerospace and other markets. Our specialist processes include tube manipulation, fabrications, machining, welding, brazing, NDT, X-ray etc. Access to our sister company, Chengdu Sigma Precision Components in China, allows us to offer local supply coupled with the highest possible value to our clients where we hold a leading position in our chosen markets. Contact: Peter Griffiths – [email protected]

university of nottingham institute for aerospace technologyThe Institute for Aerospace Technology at the University of Nottingham is a major centre for aerospace research. Our research base involves more than 50 academics and projects valued at about £50 million and includes advances in materials, manufacturing, more electric aircraft, aero engines and aerospace operations. We work with a range of aerospace firms to provide access to our graduates, improve their innovation capacity and solve technology problems. Contact: Rachel Brereton – [email protected]

Westmoreland Mechanical testing & Research ltd

Westmoreland Mechanical Testing and Research is a leading materials test laboratory located in Banbury, UK, the European subsidiary of WMT&R Inc. WMT&R specialises in a range of materials from common metals and alloys through to aerospace alloys, composites and adhesives. Tensile, fatigue and other mechanical/materials tests are performed at ambient sub-zero or elevated temperatures. WMT&R also specialises in materials failure analysis. Contact: [email protected]

Pre-Met ltdPre-Met is one of the largest precision engineering companies in the UK and Europe. We specialise in contract metal presswork and metal stampings which enables us to manufacture precision metal components of a complex nature for aerospace customers around the globe. Capabilities include prototyping, tool design and production, component design and production feasibility evaluation, tool transfer, assembly and lead wire services, moulding and machining. Contact: Mark Smith – [email protected]

Meet our paris exhibitors at stand G158, Hall 2B

A & M EDM • AAR International • Abbey Metal Finishing • Accrofab • Achieving the Difference • Acorn Surface Technology • Acres Engineering • ActOn Finishing • Advanced Chemical Etching • AE Aerospace • Aernnova Engineering Uk • Aero Engine Controls • Aerocom Metals • Aeromet International • Aerotherm Group • Air & Ground Aviation • Air Cargo Transport • Akzo Nobel Aerospace Coatings • Alloy Heat Treatment • Alloy wire International • Altran Uk • Aluminium Special Products • Ansys Uk • ANT Industries • Arrow Solutions • Arrowsmith Engineering (Coventry) • Ashton & Moore • ATA Group Uk • Atlas Composites • Axillium Consulting • bHR Group • bHw Commercial Solicitors • bIL International Logistics • birmingham Metropolitan College • bodycote Heat Treatments • bohler-Uddeholm (Uk) • bouygues E&S Contracting Uk • british Rema Processing • bromford Industries • brown and Holmes (Tamworth) • bulwell Precision Engineers • burcas • C & H Precision Finishers • CANDA Systems • Caparo Accles & Pollock • Carbolite • CE Turner Engineers • Censol • CERAM • CEVA Logistics • Chinn • Cinch Connectors • Clamonta • CNR Services International • Colledge & Morley • Columbia Precision • Comar Engineering Service • Component Coating and Repair Services • Concept Visual Management • Consilium Group • Consult Avila • Copper & Optic Terminations • Cosworth • Coventry City Council • Cowens Survival Capability • Craig Tools International • Croft Engineering • CSP Technical Recruitment • CTR-Carbide Dies • Cube Precision Engineering • Cubewano • Cullum Detuners • Cytec Industrial Materials (Derby) • Cytec Med-Lab • D & S Engineering (Coventry) • Daher Aerospace • Danatrol • Dauromatic Precision • Delcam • Derby City Council • Desktop Engineering • DLA Piper Uk • Dot Net IT • Doughty Precision Engineering • Dunlop Aircraft Tyres • Durr Ecoclean Uk • Ed Fagan Europe • Electro-Discharge • Electroservices (Midlands) • Eminate • Encocam • Encore Personnel • Energy Tubes • Erodex (Uk) • Euro-Projects Recruitment • Everards Quality Consultants • Exmac Automation • Expert Tooling & Automation • Fibracon-Insoll Machined Plastics • Freeth Cartwright • Freudenberg Simrit • Frezite Metal Tooling (Uk) • Fuchs Lubricants (Uk) • G & O Springs • Gardner Aerospace - Derby • GCC Innova • GJD Aerotech • Glass Technology Services • Glenair Uk • Gould Alloys • Graves Aircraft Components • Greene Tweed and Co • Greentree Shercon • Güdel Uk • Harrison Goddard Foote • Heinrich Georg (Uk) • Henton Engineering • Hexagon Metrology • Hockley Pattern & Tool • Holden Aluminium Technologies • Hucknall Sheet Metal Engineering • Icon Polymer • Ilmor Engineering • IM kelly Aerospace • Indestructible Paint • Industrial Tooling Corporation • IngPro • Institute of Materials Finishing • Invotec Circuits (Tamworth) • IPI Solutions • ITP Engines Uk • JJ Churchill • JJx Logistics • Jonathan Lee Recruitment • kelly Engineering Resources • kennametal Uk • kepston • kigass Aero Components • kMF Precision Sheet Metal • knight Strip Metals • kwE (Uk) • kyocera Unimerco Tooling • Lb Foster Materials Handling • LMS Uk • Lockton Companies • MA Ford Europe • Macfarlane Packaging Design and Manufacture • Manthorpe Engineering • Manufacturing Technology Centre • Marketing birmingham • Maycast Nokes Precision Engineering • Meadowbank Vac Alloys • Meggitt • Metal Spinners Group • Mettis Aerospace • MG Sanders • Micro Spring & Presswork • Micrometric • Mills CNC • Mitsubishi Materials Uk • MJ Sections • Moog Aircraft Group • Morson Projects • MP Engineering Uk • Mycon Marketing Services • Nasmyth Group • NDT Services • Nelsons Solicitors • Network Recruitment Partnership • Newbow Aerospace • NHE • NMb-Minebea Uk • Norbar Torque Tools • North warwickshire & Hinckley College • O.L.D Engineering • Oakwell Management Services • On Logistics • Osborn Metals • Oxford Aviation • PAb Coventry • Paragon Engineering & Logistics • Parmelee • Pattonair (Derby) • Paul Fabrications • Perfect bore Manufacturing • Peterson Spring Europe • Phoenix CNC Engineering • Phoenix County Metals • Pk Engineering • PM Group • Powerkut • Pre-Met • Preci-Spark • Precision Micro • Pro-Tek Engineering • PRP Optoelectronics • PT Technologies Europe • R E bowers & Freeman • Resource Group • Ricardo Uk • Richard V wallis • Roemheld (Uk) • Rolls-Royce • RTC Electronics • RTI International Metals • Rudd Macnamara • S & J Precision • Sanderson • Semelab • Shaw Sheetmetal (Rugby) • Siemens Industry • SIFCO Applied Surface Concepts (Uk) • Sigma Precision Components Uk • Sil-Mid • SL Engineering • Smith Partnership • Smithers Rapra and Smithers Pira • Smiths Metal Centres • Snap-On Industrial • SOS Metals Uk • Staffordshire Precision Engineering • Star Micronics Gb • Surface Finishing Engineering • Surface Technology • Syntax Consultancy • Tamworth Heat Treatment • TbAT Innovation • TEC • Technetics Group Uk • Techniswage • Technoset • Teer Coatings • Tekdata Interconnections • Test and Measurement Experts • The Royal bank of Scotland • Thermofax • Thyssenkrupp Aerospace Uk • Thyssenkrupp System Engineering • Timet Uk • Timken Aerospace Uk • Titanium Industries Uk • Tower Tool Company • TRaC • Trimite Technologies • TTI Group - Nitriding Services • Tufnol Composites • Turnell & Odell • Turner & Townsend • Uk Dies Group • Ultra Electronics PMES • Unite the Union • University of birmingham - birmingham Research Park • University of Derby, School of Technology • University of Leicester • University of Nottingham Institute for Aerospace Technology • University of wolverhampton • UTC Aerospace Systems - Actuation Systems • UTC Aerospace Systems - Marston Aerospace • Valbruna Uk • VirtualPiE • Volt • VR Aviation Safety Partnership • walkers European Express Services • wallwork Heat Treatment • weightmans • westmoreland Mechanical Testing & Research • wheelabrator Impact Finishers • winbro Group Technologies • wincanton • wolverhampton City Council • wTI Fasteners • wye Valley Precision Engineering • Yamazaki Mazak Uk

MEMBERs Of tHE Midlands aEROsPaCE allianCEYour source of excellence and innovation at the heart of the British aerospace industry


A common error of small companies is to assume that there is a market for their goods and services. Another

– and especially relevant in the aerospace industry – is that cash flow projections based on anticipated contracts will be sufficient to convince lenders.

A mismatch of expectation is to blame for much of the friction between borrowers and lenders, say bankers and consultants active in the aerospace and defence industries.

The specialist nature of aerospace products and services can mean high development costs, so decisions on how to fund growth require careful consideration.

Andrew Garvey, director, Aerospace and Defence, RBS, says: “Aerospace companies often face the need for up-front investment in tooling, R&D or new products. This typically has to be funded through existing operational cash flows and often with no certainty of winning a contract or the associated revenue.

“In short, firms must service the cost of the borrowing while waiting for the return.”

The long-term nature of aerospace programmes adds to this challenge: the ‘time-to-payback’ investment on plant and equipment may be 8-10 years whereas traditional bank funding can be uneconomical beyond five years. This mismatch can be a challenge for firms with good opportunities to grow.

In reaching a lending decision, RBS assesses each firm’s business case alongside

its borrowing needs. “A company needs to be able to demonstrate that it can repay any borrowing without relying solely on any new contract wins,” says Garvey.

Richard Aboulafia, senior analyst with the Teal Group, says current economic pressures mean that finance personnel, more than ever, are “passionately concerned” with the next three years while typically an aerospace supply chain company will have a perspective measured in decades.

Aboulafia told delegates to the MAA’s first annual conference earlier in the year that industrialists at every level risk becoming “prisoners of third-party finance”, with their long-term planning and short-term financial considerations on a potential collision course, unless their financiers really understand the industry.

From RBS’s point of view, developing a broad and consistent understanding of the industry goes hand in hand with developing good relationships with its customers. Rupert

Boddington, senior director, corporate coverage with RBS Corporate, Birmingham, says: “When we understand the dynamics of the business and its strategy, we can be clear on what is in the realms of the possible from a bank perspective. Equally we can help look at other aspects of finance that may be out there. It is in our interest to ensure firms can access appropriate finance for their business.”

Clive Lewis, managing partner of consultants Achieving the Difference, stresses the need to prove to financiers that the market really will grow as they anticipate. Anecdotal evidence suggests that independent market data to support the borrower’s claims of future demand “give more confidence to the lender.”

Lewis says that while bank finance remains the first choice for most companies, alternatives such as crowd funding can be “a low-cost way of getting very small amounts”. Such an approach could work well for start-ups or companies seeking an easy way of giving employees a stake in the business.

From the SME point of view, particularly where the owner may take the role of MD, finance director and sales director, their banker’s overall knowledge of financial markets, including alternative ways to fund growth, is extremely important.

For example, the Business Growth Fund may be appropriate in situations when a growing firm could benefit from a discussion around equity funding.

AsK THe eXperTsCORPORATE FINANCE

rIsK AND reTUrNwHAT DO FINANCIERS LOOk FOR IN A POTENTIAL CLIENT? NOT NECESSARILY wHAT THEY’RE SHOwN bY HOPEFUL bORROwERS.

Tackling supply chain finance issues from another angle is the recently-formed AGP (Aerospace Growth Partnership) Finance Forum, whose members include representatives

of industry, government and finance providers, including four major banks.

Dick Martin, managing director of ADEPT-Nx and secretary of the forum, says there was a concern that, while increased funding is being made available for research and development, little was being done to ensure the supply chain would have the ability to engage in the results of all this work.

The main task of the Finance Forum – not a lender itself – is to identify and recommend affordable and appropriate funding methods for aerospace supply chain companies. “we’re trying to look beyond simple short-term debt finance – beyond the same old product.”

The forum gives the space to tackle difficult financial issues in an open and honest way.

what is a typical ‘difficult issue’? It could be how to resolve the predicament an SME finds itself in when the small print of a new 10-year contract gives its customer the right to re-tender in the second year of the contract, which is an unacceptable level of uncertainty to the bank from which it needs a long-term credit facility.

“If we’re determined to make the future better, keep our aerospace manufacturing and even bring it back into this country, these are the sorts of reviews that have to happen,” says Martin.

The forum’s efforts have already led to a number of improvements. One of them is the recognition that the industry needs special attention. barclays and RbS, both members, are now moving to put teams of aerospace specialists in place.

lOOKing fOR affORdaBlE, aPPROPRiatE OPtiOns

“A company needs to be able to demonstrate that it can repay any borrowing with-out relying solely on any new contract wins.”


The civil aerospace sector offers huge growth opportunities, but our continued success as a leading aerospace nation cannot

be taken for granted. A couple of years ago, we established

the Aerospace Growth Partnership – the AGP – to provide a genuine partnership between business and government that could remove barriers to growth, boost exports and grow the number of high-value jobs in the UK.

The AGP has transformed the way in which Government now works with the UK aerospace industry. It’s certainly not been about industry laying down a list of demands to Government; nor has it been about Government trying to dictate to industry what it should be doing. Rather, it has been a collaborative process of us seeing what industry needs to do to increase its competitiveness and agreeing where Government has a role to play.

We promised at Farnborough 2012 to return as soon as possible with a full Aerospace Strategy.

Following a lot of hard work in the AGP working groups over the succeeding months we published the Aerospace Industrial Strategy ‘Lifting Off’ in March.

Lifting Off sets out an ambitious programme to keep the UK firmly at the forefront of world aerospace manufacturing and ensure that we can address the challenges of increasing global competition and changes in

technology. It’s based on ensuring that the UK has the capabilities to be at the leading edge of the design, development and production of wings, engines, aerostructures and advanced systems. These are the high-value, technologically sophisticated parts of the aircraft where the UK can maintain a sustainable competitive advantage.

We listened carefully to what industry said about the difficulties the short-term nature of public R&D support caused for strategic planning on projects; also the problems of not knowing how much public funding might be available to support private investment. So,

we’ve agreed to give industry the long-term certainty it needs to ensure that the UK remains one of the world’s most attractive locations for aerospace manufacturing.

The AGP recognises that the larger companies acting alone will not be able to make the product technology advances required to sustain the UK’s global market position. A step change towards an “R&D supply chain” is required. Yet the market is not currently creating this with sufficient urgency. To counter this, the AGP believes that industry and Government can work together to foster the development of new technologies, while the larger companies provide expertise and mentoring to encourage innovation from within the supply chain, especially SMEs.

This is why Government is willing to invest in the AGP’s National Aerospace Technology Exploitation Programme. NATEP builds on the excellent regional technology exploitation programme previously run by the Midlands Aerospace Alliance in the Midlands, and the success of those projects promises much for the prospects of the 100 new technologies NATEP will bring closer to market.

I look forward to seeing suppliers taking this opportunity to innovate and willl monitor the progress of the programme closely through the Aerospace Growth Partnership.

www.michaelfallon.org.uk

“It has been a collaborative process of agreeing those areas where Government has

a role to play in assisting business”How Government and industry are uniting to support UK aerospace,

by Michael Fallon MP, Minister of Business and Energy.

V I e W F r o M W e s T M I N s T e r

“We’ve agreed to give industry the long-term certainty it needs to ensure that the UK remains one of the world’s most attractive locations for aerospace manufacturing.”

Michael Fallon and the MAA’s Andrew Mair at the berlin airshow.


In this issue we shine our statistical light on the big picture of Midlands aerospace. And the cluster boasts some impressive

numbers. Not only sheer size but also rapid growth. The MAA estimates that 3% of the whole world’s aerospace industry is located in our region. What lies behind the current boom is our focus on civil aircraft more than defence, a bias that is growing year by year.

The numbers do throw up some surprises. Half the companies in the industry don’t make aircraft parts. And did you know the Midlands is home to six aerospace engine makers – partly linked to our automotive heritage? As well as Rolls-Royce, they are Cosworth, Cubewano, Ilmor Engineering, UAV Engines Ltd (all making UAV engines), and Roxel (rocket motors).

Less surprising is the sheer influence of the Rolls-Royce powerhouse. It tops the list of the five biggest customers for Midlands suppliers (measured by number of companies with these customer approvals), followed by BAE Systems, AgustaWestland, Airbus and UTC Aerospace Systems / Aero Engine Controls.

MIDLANDs AerospAce

sTATIsTIcs THE FIGURES THAT COUNT

75%

MIDLANDS AEROSPACE FIRMS SIGNED UP TO SC21 SUPPLY CHAIN IMPROVEMENT

168

3% oF THe WorLD’s AerospAce INDUsTrY Is IN THe MIDLANDs

45,000full-time equivalent jobs in the Midlands aerospace industry including supply chain

MIDLANDs AerospAce BUsINess TUrNoVer GroWTH IN reAL TerMs sINce 2005213%

OF THE REGION’S AEROSPACE EM-PLOYEES WORK AT ROLLS-ROYCE

1/4

OF COMPANIES IN THE MIDLANDS AEROSPACE INDUSTRY MAKE FLYING PARTS

52%ai

rcra

ft e

ngin

e m

aker

s in

the

Mid

land

s6OF MIDLANDS AEROSPACE SALES TO CIVIL MARKETS (50% FOR UK AS A WHOLE)

IN NUMB3r5


proFILeVIEW FROM THE bOARDROOM

MAA board member Simon Beech, divisional managing director of Nasmyth Group and managing director of Bulwell Precision Engineers, shares his thoughts on the industry and its challenges.

Q. WHere DID YoU sTArT YoUr cAreer? A. I started with Lucas Industries as a graduate trainee, straight out of university. In common with most large companies, they moved me around so I got a grounding in automotive and aerospace. I started in HR and worked my way through into sales and marketing, business development and project management. After 17 years with Lucas, and at the point where its ownership was changing, I was head-hunted by Leonard Sedgwick, the founder and owner of Bulwell Precision Engineers. It was still a privately owned family business and Leonard was 80, so about three years after I joined, in 2003, we sold the business. Bulwell became the initial acquisition of the Nasmyth Group, and remains the largest. I sit on the Nasmyth board and take a lead role in our machining, surface treatment and OEM manufacturing business.

Q. coULD soMeoNe sTArTING oUT ToDAY TAKe THe sAMe pATH?A. Yes, I think so. Working in a large plc is a good grounding for anybody. You learn all the management tools and techniques and gain experience across the breadth of those organisations. Lots of people get trained in large businesses, then go to smaller ones where they can apply their experience. You probably couldn’t go the other direction, small to large, because the skill and knowledge base is different.

Q. WHAT HAVe YoU LeArNeD IN INDUsTrY THAT YoU coULDN’T LeArN IN UNIVersITY?A. The mechanics of work and business.

The right service offering is the key element

“Working in a large plc is a good grounding. You learn management techniques and gain experience across the breadth of the organisation.”

www.bulwell.com

It tends to be about relationships, managing and interacting with people. You can’t learn that through a degree programme or anything else.

Q. WHo HAs INFLUeNceD or INspIreD YoU IN YoUr cAreer?A. I had a couple of mentors who encouraged me to explore more general business options; people in senior HR functions who’d made the transition themselves. They supported me to do my MBA to gain the knowledge needed in that sort of role. I’ve done the same, helping develop people from the shop floor to populate management roles in our business. It’s good to see people developing, and it’s good for the business.

Q. WHAT Do YoU see As THe BIGGesT THreAT To THe AerospAce INDUsTrY?A. That depends on the level. From the supply chain view, it’s ignoring globalisation. There aren’t as many prime customers in Europe as there were. You have to look beyond, to those you’re not familiar with. Globalisation is affecting what we do and how we respond to it is crucial. I see it as both a threat and opportunity. If you have the right skills and strategy in your business to go and explore, it’s an opportunity. If you don’t, it’s a threat.

Q. Is THere A secreT To GAINING coMpeTITIVe ADVANTAGe?A. Having the right service offering is the key element. If you can make your customer’s cost of acquisition better, your UK-made goods will be affordable. Exporting is a big part of our business. Export volumes change; overall it is close to 20%, however when you look where our products ultimately go on an aircraft or engine, and after our customer exports their product, our export percentage is closer to 70% of output. That’s got to be good.

OnlinE: WWW.MIDLANDSAEROSPACE.ORG.UK/EVENTS

The Midlands Aerospace Alliance (MAA) is the voice of companies in the British Midlands supplying global aerospace. Its 290 corporate members range from global aerospace players to SMEs. The MAA board comprises senior managers from Aero Engine Controls, UTAS Actuation Systems, Meggitt, Moog Aircraft Group and

Rolls-Royce, elected supply chain representatives and key regional partner bodies.

for additional copies of Midlands aerospace, or to add your colleagues to the distribution database, please contact the Maa by any of the means below.

For YoUr DIArY

www.midlandsaerospace.org.uk/join

If you have a query or suggestion that you would like to make, please contact the MAA.

T: +44 (0) 2476 430250F: +44 (0) 2476 430251E: [email protected]

AerocoM MeTALsCoventrySteel stockholder.

ALTrANCoventryCivil and military aerospace systems and products.

ANsYs UKSheffieldEngineering simulation.

BIL INTerNATIoNAL LoGIsTIcsHalesowenLogistical solutions.

DoT NeT ITHalesowenERP software implementation and business consultancy.

DUrr ecocLeAN UKWarwickCleaning, automation and filtration installations.

eVerArDs QUALITY coNsULTANcYSutton-in-AshfieldQuality improvement specialist.

ILMor eNGINeerINGbrixworthHigh performance engineering.

INGproShrewsburybusiness consultancy.

KYocerA UNIMerco TooLINGFradleyTooling systems for composite and metal applications.

LocKToN coMpANIesbirminghamIndependent global insurance broker.

MAcFArLANe pAcKAGING DesIGN AND MANUFAcTUreCoventrybespoke packaging.

MeADoWBANK VAc ALLoYsRotherhamRecycling solutions for complex alloys.

NMB-MINeBeA UKLincolnManufacture of bearing products and assemblies.

NorTH WArWIcKsHIre & HINcKLeY coLLeGeHinckleyFurther education.

oXForD AVIATIoNOxfordSupplier of consumables for

civil and military aerospace applications.

pAB coVeNTrYCoventryPrototype and production sheet metal fabrication.

pArMeLeeWalsallManufacture of safety eye wear.

roYAL BANK oF scoTLANDbirminghambanking services.

sNAp-oN INDUsTrIALKetteringTools, tools storage and torque equipment for the aerospace industry.

TesT & MeAsUre eXperTsHalesowenTest and measurement automation.

WALKers eUropeAN eXpress serVIcesDudleyExpress light haulage transport throughout UK and Europe.

NeW MeMBerscALeNDAr

ABoUT THe MAA…

pArIs INTerNATIoNAL AIrsHoW 201317-23 Junele Bourget airport exhibition site, ParisThe world’s largest event dedicated to the aviation and space industry.

AIrLINe eNGINeerING AND MAINTeNANce sAFeTY10-11 July Crowne Plaza london - the City, london Key issues and best practice in safety and regulation, fatigue, communication etc.

rUssIAN WorLDWIDe AIr sHoW - MAKs 2013 27 august – 1 september Zhukovsky, Moscow Russia’s premier international aviation and space exhibition: an opportunity to establish contacts at various levels and find new business partners.

Aero eNGINeerING sHoW 201312-13 november nEC, Birmingham Exhibition of leading technology and engineering supply chain programmes in design, manu-facturing and machining etc.

ADs MeMBers ForUM25 June Manufacturing technology Centre, Coventry The first of two events designed to keep ADS members abreast of developments emerging from the Aerospace and Defence Growth Partnerships.

for further information and to book your place at

an Maa event, please scan the QR code or visit www.midlandsaerospace. org.uk/events

Scan to visit the searchable database of all MAA member companies.

the Maa welcomes the following new members

midlands aerospeac€¦ · aero engine controls set to invest in £60m state- ... maa-ukti trade...

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