- 2 days ago
It’s a time of great technological challenges and change, and Gardner Aerospace CEO (and former Airbus CFO) Philipp Visotschnig tells CGTN Europe’s Iolo ap Dafydd the aircraft industry has to be ready to meet the future.
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00:00What does the Paris Airshow, being the biggest of its kind, what does it mean for the industry, military, defence and civil aviation?
00:09For me personally, but as much as for the industry as a whole, it is a point of reconnection.
00:14We meet once a year, once in London, once in Paris, and this is the time to reconnect with the industry.
00:20Is this week, the Airshow, is it about business, is it about the industry, or is it about something else?
00:27For me, it is all, and it is about connecting with the, this is a very small community, it's an ecosystem.
00:35There is only two OEMs, there's probably 5,000 suppliers, and we have 5 billion of passengers every year.
00:45That's what comes here together, every day.
00:47So, a small industry, but obviously with enormous impacts.
00:52One of those impacts we saw in India last Thursday, a devastating crash, what kind of impact does that have on the industry?
01:00I mean, first of all, this is an awful tragedy, and thoughts and prayers go with the victims and the families.
01:06I mean, let's be clear, this is not nice and not good for anyone.
01:10For me, this is a reminder that this industry is built on trust, it is built on consumers having trust in flying safely on an aircraft.
01:22And the way we translate that at Gardner is, we need to do just impeccable quality products every time.
01:30We cannot allow to have scratches on our path. Does it matter? It does, because there could be corrosion.
01:37Does it matter if the traceability is not full? It does, because we want to check in case that something happens.
01:44It is a call for duty that we need to have the stringest quality requirements possible.
01:50The investigation, of course, is continuing in India to that crash, but it surely does impact passengers' confidence, doesn't it?
02:01I mean, again, it is a tragedy, but let's remind that this is an impeccable safe aircraft.
02:08It's the first time that there has been a deadly crash. We don't understand why.
02:12There are thousands of aircraft, thousands of 787 flying and landing every day.
02:19It might be having a bad feeling, and again, it's a tragedy for everyone there, but it doesn't change the fundamentals of this industry
02:29that are built on quality and safety and safety integrity.
02:33When you come to a big international event like this one in Paris, what are you looking for?
02:39Contacts, new businesses, new manufacturing bases. What takes precedence for you?
02:46For us, it is getting contact with the customers again.
02:50Gardner Aerospace is a company that delivers to commercial aircraft, so our customers are typically Airbus,
02:57but also Tier 1s, and they're all here, and it's good to see them all.
03:01And in terms of new inventions now, the way technology is developing, what do you see and what excites you?
03:10I'm very much excited about Industry 4.0, digitalisation and AI.
03:16I think it really will drive the way we, when we are capable of measuring these manufacturing points,
03:23it will really allow us to be far more efficient in producing.
03:29This industry is still fairly young, and automation and all that is far behind than what you would know from automotive.
03:35Here, I think I see a point. And then, obviously, there is an excitement on.
03:39There have been announcements that Airbus are thinking about a new generation of Singlar aircraft.
03:44Yeah, probably only in the 2030s, we understand that, but the technologies that need to be for this aircraft,
03:50this is what we want to prepare for.
03:52Well, let's pick up on those two things then. Automation, right?
03:55We can see how that's happened with cars and with electric vehicles.
04:00How do you see that happening more and more in aviation?
04:04I mean, I'm now for more than 20 years in this industry, and there was always the saying,
04:09it is too expensive to invest into automation because volumes are still fairly small.
04:14I mean, in total, there are 1,000 aircraft produced a year. There are millions of cars produced.
04:18So the business case is a different one.
04:20However, with technology becoming cheaper, there is probably a case where we can make more automated.
04:28And automation is not only an answer to efficiency. Automation is also an answer to access to resources.
04:36So we are all fighting for labor. We are all fighting getting the right resources.
04:42There, automation helps. And it is also an answer to just having more string and quality.
04:49in the product itself. Normally, the mistake is the human. And the check is the human.
04:57So automation is an answer to that.
04:59And is that why you also mention artificial intelligence?
05:02Because AI is having such a huge impact in just about every field where humans are involved?
05:11Correct. And it will help us to measure far more data points.
05:14And aircraft is an incredible complex product. Broken it down to what we do, even the products we do are terribly complex.
05:24If we measure that, if we measure more data points, if we have a more stringent view on that, this will allow us to understand better and to manage better.
05:32But surely, I thought, you know, aircraft engineers is such a special role of well-paid jobs.
05:40Are we talking about a radical change in the employment of these massive aircraft factories we see in North America and in Europe?
05:49Being an aircraft engineer myself, I'm not so sure it's well-paid, but joke aside.
05:54No, the thing is, it will help to manipulate large amounts of data far quicker.
06:04That is what this growth is about. If you deliver faster, more and better, everybody benefits of that.
06:11Where do you see growth now in terms of aircraft and civilian aircraft in the world? Is it inevitably India and China?
06:22It is. It is. I mean, there is a bit of a logic, which is passenger and freight transport is a direct function of GDP growth.
06:34And the growth areas are Asia. It's not only China and India. These are the big ones, but it is where there is more growth than usual one.
06:44So this is the first driver. And with an increasing middle class, there will be just more passengers in Asia. That's the way it is.
06:54The growth, some experts say, is almost up to 40 percent, which is, for somebody like me outside of engineering,
07:01seems almost unbelievable in the next few decades.
07:05I think that's very, it was demonstrated in the past. There is a huge amount of aircraft that need to be replaced.
07:11These are old aircraft that are less fuel efficient, that require a level of upgrading to make customers and passengers fly safely,
07:24fly less CO2 consumption. So that's all what it is about. The growth is only going to explode.
07:32You used to work with Airbus, one of the two huge manufacturers in the world.
07:37Airbus is obviously developing and expanding in China. They have one production line.
07:43They're putting in a second one before the end, possibly of this year. Do you think that Airbus is in a good position to expand now more and more
07:53and go for, as you say, these new technologically advanced aircraft?
07:58China is a huge market for Airbus and China will continue to be a huge market for Airbus.
08:05I think that's with the end of two final assembly lines are a response to customer proximity requests.
08:21Customers want to be close. Customers want to know where they can get their aircraft. That's what they have there.
08:27And for Gartner Aerospace, what does that mean that more and more of your production and manufacturing is also made outside the UK, but possibly outside Europe?
08:39We have a global structure, a global product offering, and we deliver and produce where the customer wants us to be.
08:46Our industrial footprint is probably 60% still in Europe, 40% in China and in India.
08:56Obviously growth is there where there is growth in aircraft deliveries, so we expect to grow more.
09:05There's still growth in Europe, but we expect that the incremental growth is going to be in India and in China.
09:12So, in a way, your company and many other companies like you are in a position where you could be affected rather badly with international tariffs.
09:21And if this tax on goods is introduced or even the threat of it, it must have a negative impact.
09:27We are impacted. We don't understand it in full yet. It has to go away to make it very simple.
09:32It is not good for the industry. It is not good for consumers. This is a supply chain that has been developed over the last 25, 30 years.
09:41It is very interconnected. To give you a very simple example, we are producing, we are machining parts in China based on raw material that comes from the US and the customer is in the UK.
09:52This has been developed over many, many years. If you add here whatever the number is, 25, 145, whatever it is, it breaks the chain.
10:03This is destructive. It breaks the change and it cannot, our margins don't allow for that. No one's margin allows for that.
10:11And at the end it is the consumer that pays. So, what is it then? A political misunderstanding of how the economics works for so many global companies or is it a vain hope of attracting more business into the United States?
10:26We don't know. We don't know. We don't know. We don't understand. But what we see is the paradigm that we have here is we cannot plan because it changes every day.
10:38There is so much uncertainty in that and uncertainty kills business. You cannot make rational decisions if every day the plan changes. And that's the main problem.
10:48We would adapt if needed. Today we are just thinking probably the plan changes tomorrow if we don't need to adapt. Which is a situation of nothing moves on and that's not good for growth.
11:01They always say, don't they, that uncertainty for any business is dreadful?
11:05It is. It is. And it's not good for us.
11:07Okay. So, let's talk about something we do know that will happen which is sustainability and the need technologically and environmentally for aviation to up its game and to do basically what engineering allows it to do but also what the consumers want.
11:24I think consumers want to travel. And when we look at it, there is so much growth and there is so much growth expected that the growth will outperform even the reductions that we see.
11:39That's not good. So, we need to do more. We need to do more because at the end it is about this, our permit to operate as an industry is in danger if we don't get on a path towards sustainability.
11:52We need to get to this carbon free or emission neutral aviation by 2050 because there is the risk that consumers will just stop it.
12:02It started a little bit or we could observe that during COVID when they were blaming of, it's not the travel and the aircraft that is the problem. The emissions are the problem.
12:12Being an engineer, we need to get the emissions out, not the travel. Consumer wants to travel. We need to fix that.
12:18Okay. So, how do you fix it? Is it the sustainable aviation field or is it the technology of these airplanes?
12:24I think it's a mix of all. The first step is clearly or the first contributor to reducing emissions are less emission aircraft.
12:38An aircraft that you buy today exhausts far less emissions than an aircraft 15 years ago. So, bringing new aircraft to the market helps.
12:46Secondly, the technology is not anything that helps in reducing emissions.
12:53Winglets, more efficient engines, all that reduces emissions. And then SAF, sustainable aviation fuel is the answer to that.
13:00A complete emission-free aircraft is not expected in the next 10 to 15 years.
13:05So, what you're saying is that airline companies, governments, companies should spend more and buy newer planes?
13:12Yes. Yes.
13:14It's good for your business, isn't it?
13:15Which is good for my business, but it's also what is good for them because they like to travel. It is a personal need to travel.
13:22But there is a serious point there. Is it affordable? Because, as you're probably well aware, there's already this kickback against net zero.
13:31Even in the UK and many other Western countries, they claim it's going to be too expensive for the economy.
13:36I understand that and I accept it, but I think that's the call for action for engineers, being a self-born, to find a solution that is affordable.
13:45And innovation is an invention that makes money. That's what we need to do.
13:50We need to innovate in a way to make it a business case and then it will work.
13:57Again, geopolitically, things are so unstable, changing so much now in Eastern Europe, Middle East and so on.
14:05It does have an impact on society. It has an impact on how people live.
14:10Does that make you feel more nervous and fearful of the future?
14:15Or do you think that actually aviation is in a good place, civil aviation is in a good place?
14:19First of all, I'm an optimist by nature.
14:22And a good example here is in the second quarter of 2020, when the pandemic hit,
14:35and everybody was saying there is no aircraft flying. All stop.
14:40When you look on the stats, in the second quarter of 2020, there were more aircraft flying than in 1993,
14:48when I was getting out of school. This is this growth that is behind.
14:54I mean, in 1993, we found it completely normal to see this aircraft.
14:58There will be ups and downs, and aviation is depending on GDP.
15:03Aviation is depending on people having trust in flying.
15:06But there was this immense growth over the last 30 years, and this is going to continue, probably a little bit.
15:12And you think that your growth, you think, is definitely in Asia more than anywhere else?
15:17Our growth is global. Our growth is global.
15:19But where we produce and where we deliver this growth is probably more out of Asia than somewhere else.
15:25Thank you very much indeed.
15:26It was a pleasure. Thanks for having me.
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