Ian Sheppard/LONDON
A new report from GEC- Marconi highlights fears within the UK avionics sector that it may lose out in the pending consolidation of the European aerospace industry with its interests potentially swamped by those of the aircraft manufacturers within proposed mega-mergers.
Senior sources at GEC, the UK's largest avionics producer, indicate that they are looking for horizontal integration in Europe, claiming that there is a need to maintain independence from aircraft manufacturers so that the can continue to offer systems for a broad range of aircraft types.
The sources suggest that the UK electronics giant would consider a tie-up with a US avionics manufacturer to attain critical mass, if its independence is not assured within Europe. GEC has been holding talks with the new Alcatel/Thomson-CSF grouping in France and is close to sealing a wide-ranging pact with Italy's Alenia Difesa on defence electronics, but sources close to the company have suggested that the top management is growing impatient with the lack of progress and general direction of European restructuring.
The latest concerns were expressed at the unveiling of the Avionics Research Project, a study led by GEC and which is co-ordinated by the Aviation Industry Regional and Local Authority Network (AIRLINE). The group claims that the UK avionics business has already been through rationalisation, accompanied by aggressive cost-cutting, but warns that potential partner industries elsewhere in Europe have yet to face up to cutbacks.
AIRLINE, a grouping of companies and local authorities, is concerned that if organisations such as GEC are forced into European mergers, they could face the prospect of a further round of job cuts and the loss of leadership in key high-technology areas.
The group calls for better recognition of the sector's importance within the UK and a stronger voice with which to argue its case at a European level.
Source: Flight International
