Exports Drive Revenue Boost for French Aerospace & Defense

 - May 3, 2016, 2:44 PM
Airbus's order book stretches back almost 10 years and is a big contributor to strong results for the French aerospace industry. [Photo: Airbus]

French aerospace and defense industry group Gifas celebrated what it described as a record year for its member companies, who collectively achieved an 8.5 percent increase in 2015 revenues at €58.3 billion ($65.9 billion). Exports were especially strong last year, growing by 14 percent, to €39.4, billion ($44.5 billion) and representing 83 percent of total revenues for the French industry.

At the end of 2015, the combined order book for Gifas’s 364 member companies was valued at €78.3 billion ($88.5 billion), which was 2.3 percent up on 2014. Collectively, this amounts to about 5 years of production on average, but Gifas president Marwan Lahoud said that for leading airframer Airbus, which is headquartered in Toulouse, it amounted to more like 10 years of production. That said, last week Airbus acknowledged that it is facing significant production issues that could sap its profitability on a number of programs, including the A350XWB and A320neo airliners, and the A400M military transport.

Civil aerospace accounted for 77 percent of all Gifas member sales in 2015, and these showed an increase of 10 percent compared with 2014. Defense sales grew by 16 percent and Lahoud predicted that 2016 stands to be a good year for French military exports.

However, Gifas conceded that the business aviation and helicopter sectors have continued to struggle due to factors such as depressed crude oil prices and reduced demand from emerging markets like China. “But despite this we continue to grow,” claimed Lahoud.

For smaller companies in the French aerospace supply chain, 2016 is set to be a  year of “transition,” according to Gifas’s equipment makers sub-group Gead. “The growth will be moderate for the next two years before a very steep rebound with the ramp up of the A320neo and [Boeing] 777X for those who work in the U.S.,” commented Gead vice president Patrick Daher, who is also president of aerostructures group Daher, which also makes the TBM family of single-turboprop aircraft.

According to Gifas, French companies are expected to recruit another 10,000 people in 2016, with an as-yet-unspecified net gain in new positions. In 2015 the industry supported a record number of 185,000 jobs, with 11,000 people hired and a net gain of around 3,000 positions.