Paris Air Show

GKN telegraphs intent to bid on Airbus plants

 - June 12, 2007, 11:45 AM

Britain’s GKN Aerospace has signaled its intention to bid for stakes in one or more of the Airbus factories now being put up for acquisition or partnership under the troubled European airframer’s Power8 restructuring plan. The strategic acquisition could play a key part in GKN’s ambition to more than double its annual revenues to reach $4.2 billion by 2016.

“Some [of the Airbus] sites would fit strategically with us and would play into key areas of businesses,” GKN Aerospace CEO Marcus Bryson told a press briefing before the Paris Air Show. “Our technology would make them grow,” he added, while also indicating that he is not deterred by the prospect of political turbulence during the implementation of Power8, which would result in the loss of some 10,000 jobs at Airbus. The airframer is looking to sell or open up to outside investment its plant at Méaulte, France, as well as Filton in the UK and Nordenham in Germany. It wants to reach binding agreement on these by mid-July.

To date, GKN’s acquisitions trail has largely been in the U.S., where recent purchases Teleflex and Stellex have enhanced its technology portfolio. Teleflex increases GKN’s ability to design and build more engine components, allowing it to fulfill its ambitions to supply hot-end modular units, such as composite and metal fan blades. The addition of hard metal machining specialist Stellex has strengthened GKN’s position in aircraft floor structures and main bulkheads. The new subsidiary is especially strong in the machining of titanium, for which demand is currently very strong.

According to Bryson, GKN especially wants to grow its involvement in the single-aisle airliner sector and also in the aftermarket. It believes that it can offer the type of advanced aerostructures and propulsion systems technology that both Airbus and Boeing say they will need to trigger the launch of successor developments to their respective A320 and 737 families.

For instance, a good part of GKN’s substantial investment in aerostructures development and manufacturing is focused on how sensors and fiberoptic links might be integrated within composite structures to replace awkward electrical harnesses. These might be used to relay power, control signals and many types of data, while acting as diagnostic tools for the condition of the airframe.

According to senior technical director Phil Grainger, GKN sets great store in the development of so-called smart structures that can include embedded circuitry. It has already applied this approach in the wing leading-edge ice protection system developed for both the Boeing 787 airliner and Lockheed Martin’s F-35 Joint Strike Fighter.

“The single-aisle programs [of Airbus and Boeing] are the next big digital switch for industry, and we are all trying to position ourselves for this,” said Grainger. GKN has said it is willing to build a brand-new, fully automated composite factory, and it is also actively looking at investing in titanium and metallic technology which could include additive processes. “We could be at the threshold of some materials revolutions,” he concluded.

During 2006, GKN achieved several new program selections that it values at more than $1 billion in additional revenues. These include a contract to design and build the aft transition structure for the new CH-53K heavy-lift helicopter for the U.S. Marines, intakes for the F-22 fighter and exhausts for the Boeing 747-8 airliner.
Through a new partnership with Aviation Partners of the U.S., GKN is to design and build winglets for 767s operated by American Airlines. This work will be done in the UK, and GKN is taking over from Japan’s Mitsubishi as program partner. It will also produce Aviation Partners winglets for 737s.

GKN will apply its advanced composite automated tape laying processes for the new winglet program. According to Bryson, they deliver a radical reduction in manufacturing time compared with hand-laid composites, making it viable to keep composites manufacturing in the relatively high-cost economy of the UK.

Revenues for 2007 are projected to reach $1.6 billion. According to its nine-year growth plan between now and 2016, GKN expects to maintain the existing share between its respective businesses of just over 50 percent for integrated aerostructures, approximately 36 percent for propulsion system components and structures (including nacelles), 11 percent for special products and 3 percent for engineering services.

Finally, like many other Western aerospace firms, GKN is struggling to recruit the right caliber of engineers for managerial positions. Apart from offering incentives such as training, international career opportunities and a generous pension plan, the issue is one factor that has prompted GKN to look to countries such as India for outsourcing opportunities.

Recent Milestones at GKN

At a pre-Paris Air Show briefing, GKN Aerospace CEO Marcus Bryson highlighted recent technology and production milestones achieved by the company:
• The first application of resin film infusion technology for composite structures on
the A380,
• The first composite main wing spars for a U.S. fighter, the F-22 Raptor,
• The first large-wing composite spar, delivered to Airbus for the A400M military transport,
• The first large-engine composite fan case, delivered to General Electric for the GEnx turbofan,
• The first composite engine front end, delivered to Pratt & Whitney for the F-35’s engine,
• The first composite large-wing all-electric de-icing system, delivered to Boeing for the 787,
• The first advanced F-35 canopy, delivered to Lockheed Martin.