Building a successful aerospace cluster is not just about attracting new companies to a smart architect inspired business park; it's also about building useful and interconnected supply chains, according to Invest Bristol & Bath's Barry Warburton.
Warburton, an aerospace and advanced engineering sector specialist at the investment promotion agency and a former chief executive of the West of England Aerospace Forum (WEAF), believes economic development agencies need a deeper understanding of sectors such as advanced manufacturing if they want to build sustainable economic regions.
“Economic developers may be good at what they do, but are they aware of things like automation, robotic systems and all the other technical advances that are happening in engineering?,” he comments. “I visit companies and I try to find out what their technical requirements are and why they might want to invest or expand. It's about giving these businesses the confidence to know that they can talk to someone who really understands what they might need when it comes to manufacturing.”
The time of the primes
Bristol and Bath, and the wider South West corner of the UK, already has one of the most successful aerospace and advanced engineering economies in Europe. Some of the biggest names in aerospace, such as Rolls-Royce, Airbus, GKN Aerospace and AgustaWestland have facilities in the region along with a network of world class supply chain companies. According to Invest Bristol & Bath, the sector brings in an estimated £7 billion to the area's economy.
“For global businesses in the aerospace sector seeking a new base, the Bristol and Bath region is the ideal location. We already have 14 of the 15 biggest primes present here. We also have the strongest academic cluster in the UK after Oxford & Cambridge.”
Invest Bristol & Bath says 42% of the region's graduates in sectors relating to high value engineering, high tech, creative and digital industries remained in the area in 2012. The area's academic institutions work collaboratively with industry on many areas of R&D. It is also home to the National Composites Centre; the Filton Enterprise area, a hub for aviation technology; Emersons Green enterprise and technology centre and the Bristol & Bath Science Park.
Warburton is keen to attract investment from companies involved in the latest manufacturing technologies.
“I want to bring in companies that strengthen the supply chain, not that compete with the companies already here. I look at advances that are driving the future of aerospace, including robotics and automation, composites, additive manufacturing, metrology and modern machining techniques. There aren't gaps in the supply chain but there are weaker areas and I want to strengthen these because I don't want to see the primes and tier 1s taking that business offshore.”
Warburton believes that high-tech companies involved in other areas of industry can exploit opportunities in aerospace by cooperating with one another.
“Businesses benefit from the collaborative nature of the region's business community, whereby interlinked sectors work together to develop new innovations and open up opportunities in new markets. These interconnected sectors span an array of industries, including advanced engineering; high tech, such as microelectronics and robotics; creative and digital; and low carbon. The richness and diversity of this sector base offers companies a unique opportunity to be part of a vibrant and dynamic business environment.”
But what real prospects are there for companies new to aerospace when the sector is so closely regulated and higher tier companies require such high standards and accreditations from their suppliers?
“Providing you invest in the right kind of technology and the right kind of machinery there are opportunities. Look at lower tier companies and consider who you can work with to get a foot in the door. The OEMs may think they have enough suppliers, but with the ramp up rates required and the need for more capacity there are opportunities. It's the lower Tier 1 and Tier 2 companies who are looking for new suppliers, provided they can produce parts to the required standards. Improvement programmes such as SC21 and AS9100 Rev C help. If companies work towards these standards they are halfway there.”
However, Warburton believes better cooperation is required throughout the aerospace supply chain so smaller companies can work on longer term contracts, enabling more investment in new technology and staff.
“Subcontractors do not just supply aerospace; they also supply automotive, rail, oil & gas, etc. so they have production outputs for a week or a month to consider. If these are reduced suddenly because a big aero order is cancelled it is difficult to accommodate it. It should be possible to make longer term forecasts and agreements between companies.”
However, he is also pragmatic about what well publicised growth predictions for new aircraft mean for the lower tier subcontractor.
“The further down the supply chain you are, the less important predicted sales into 2030 are. A machine shop runs a business from order to order; month to month. Planning is inevitably more difficult for the smaller contractor. I would advise any subcontracting company not to have more than 35% of its orders from one customer. Anything over 35% and you are too reliant on one company.”
Money matters?
Warburton argues that monetary incentives are not necessarily the best way for regions to attract businesses.
“When companies think of investing in the UK they are not just interested financial support; what they are looking for is a good customer base, skills, technology and universities and other academic institutions supporting industry. Access to skills is very important; training, apprenticeships and graduates are key. In the UK we need to attract more students into STEM subjects. If we don't have the workforce then potential companies can go to countries like India, where many more engineering graduates are being produced currently.”
So what prospects does Warburton see for Bristol and Bath and the South West region when it comes to attracting more aerospace investment?
“We are addressing investment from the perspective of industry. We understand the dynamics of the supply chain and how companies can work together through the extended supply chain to identify the needs of manufacturing. The South West has a great opportunity to draw on its heritage in aerospace from the earliest box flying kites to Concorde and the high-end manufacturing still going on today.
“We are taking a technology first approach to attracting new companies. If there is any spare capacity in the supply chain it is around new technologies such as additive manufacturing, composites and new machining techniques that will make us more competitive. And clusters will continue to be important for subcontractors because they give them access regarding the strategic thinking of the OEMs and tier 1s. Ultimately everything is about connectivity, every component connects to something else, and every network links to another.”
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