The combination of a first day back to work after the Christmas-New Year holiday break and a blast of Arctic weather that brought much of the UK its first snowfall of the winter hardly augured well for a fresh start to 2009. But for GKN Aerospace a bleak morning in Bristol did indeed herald a bright new beginning, as it formally took ownership and operational control of the wing components manufacturing operations at Airbus's Filton engineering complex.
The £136 million ($209 million) deal - GKN pays £100 million on completion and the rest in instalments over 2010-15 - had been a year in the making. GKN Aerospace chief executive Marcus Bryson says the "very complex" deal was "not like buying a business with four walls around it", as the operation was being carved out of a larger Airbus business.
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But while 1,500 workers at Filton noticed little difference when they reported for work on 5 January as employees of GKN rather than Airbus, for both partners the day was a landmark.
For Airbus, the deal marked the completion of an aerostructures reorganisation that may prove beneficial, but falls far short of its original reach. A year ago the airframer had grand plans to match the Filton sale with similar deals for plants in France and Germany as centrepieces of its Power8 cost-cutting scheme.
Airbus's plan was elegant. Selling the manufacturing sites would give the company a cash injection, allowing it to better deploy capital. And, as the buyers would be risk-sharing partners in the A350 widebody twinjet programme, Airbus would cut its financial risk in developing that rival to the Boeing 787.
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For their parts, the prospective buyers - GKN, along with MT Aerospace (for sites in Augsburg, Nordheim and Varel in Germany) and Latécoère (Meaulte and Saint Nazaire Ville in France) - would buy into the A350 project as well as be able to use the plants for customers other than Airbus.
But talks with MT and Latécoère broke down owing to the euro-dollar exchange rate, economic turmoil and Airbus's need to advance A350 design work.
Airbus's solution was to fold its French and German production sites into two subsidiaries - Aerolia and Aerotec - to supply Airbus and, conceivably, others. Of the units' establishment last week, chief operating officer Fabrice Bregier says: "Airbus can focus on our core business - being an aircraft architect and integrator."
While the grand Airbus plan has only partly come to fruition, its GKN-Filton component remains a testbed for the original concept - and Bryson is bullish about the prospects.
The deal, he says, takes GKN Aerospace's headcount up to 10,000 worldwide and propels it solidly into the top ranks of tier 1 suppliers, with projected 2009 revenue of about £3 billion, including £350 million from Airbus and rivalling leaders such as Spirit AeroSystems.
Indeed, Bryson ranks his operation third in the world and rates its composite materials manufacturing expertise as industry-leading. A composite manufacturing facility dedicated to Airbus A350 XWB wing trailing edge and wing spar assemblies will be constructed at Filton, he adds.
Critically, GKN's plan is to attract non-Airbus work and decrease the Airbus-related share of the business to just 60% within three years. Bryson declines to reveal names, but says "four or five customers" have been in serious discussion about bringing work to Filton, and Boeing has discussed possibilities there.
A non-Airbus customer would be announced in "three to six months", he says. There is precedent for GKN's 60/40 Airbus/non-Airbus target in the transformation achieved at the former Boeing defence site in St Louis, Missouri, which GKN bought in 2001.
Bryson is talking in terms of building "a much deeper strategic relationship" with Airbus and is looking beyond the A350 to the next-generation single-aisle aircraft that will eventually replace the A320 and Boeing 737.
BCG Partners chief strategist Howard Wheeldon says it is safe to say those aircraft will be "predominantly composite based" and GKN should be in position to rival Alenia, Spirit and Vought as a likely key supplier.
GKN is now in control of the wing components operation at Filton
Source: Flight International
