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Up in the air
When BAe Systems announced it was to sell its 20 per cent stake in European
aircraft maker Airbus, there were concerns that 13,000 UK jobs – designing and building the wings of large commercial jets for the consortium – could be under threat. Coming after years of decline and change in Britain’s manufacturing base, the loss of those highly skilled jobs would have been a severe blow.
Since the 30-year-old pan-European relationship began, there have been some notable successes in the commercial airline business, but now BAe Systems is seeking to concentrate on its core business of defence contracts. Although the relationship with Airbus has consistently generated profits and provided serious competition to American rival Boeing, there have been some concerns about the commercial viability of the company’s new A380 superjumbo – the world’s largest passenger aircraft.
BAe’s stake is expected to be bought by Eads, the Franco-German group that owns the rest of Airbus. The sale means there will no longer be any British ownership of the huge manufacturing sites at Broughton in North Wales and Filton near Bristol.
Airbus recently announced the creation of an extra 650 jobs at Broughton, which is Wales’ biggest manufacturing site with 6,000 staff. Despite concerns about the security of those jobs, BAe Systems insists that it has secured at least their medium term future, having written a protection mechanism into the original contract.
“We do not believe that this decision will have any impact on jobs,” a spokesman for the company told Blue Skies. “In the agreement between Airbus and BAe Systems in 2001, we created a legal protection for those jobs in the UK. It means that the wing work carried out in the UK will not move outside the country unless Airbus can prove an economic reason for doing so. Because the UK has this centre of excellence, we don’t believe that is something that will happen – at least in the medium term.”
The company adds that the protection mechanism “can actually be passed from BAe Systems to the UK government, and that was also put into the agreement, so in the case of a sale the UK government will hold the protection”.
It is a commitment that the government has promised to oversee, with a view to long-term employment protection. A spokesman for the Department of Trade and Industry, which oversees the contractual arrangements, said that the government remained committed to maintaining the clauses and would work to ensure the continuing employment.
“Airbus is a European success story. A key reason for this is the effective partnership and use of specialist skills across Europe. The government remains committed to future Airbus aircraft programmes and is currently in discussion with the company about the forthcoming A350 programme,” the department spokesman told Blue Skies.
The unions have expressed relief, but complain that manufacturing is being damaged by a lack of long-term planning.
TUC general secretary Brendan Barber said: “The reasons behind this decision must be clarified. Airbus is clearly a strategic manufacturing company, providing first-class skills, levels of investment and jobs at Filton and Broughton. For BAe to sell their stake at this stage smacks of the short-termism that is holding back UK industry. We welcome the statement that none of the 13,000 jobs are at risk, and look forward to that promise being kept.”
In an increasingly globalised world, such fluidity is likely to become more and more common, and the aerospace industry will not be an exception.
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