06 October 2006

Wrong call

A Rolls-Royce Trent 900 engineThe shock waves from Airbus's incompetence continue to ripple through the system with The Times and others reporting that Rolls-Royce is suspending work on its Trent 900 engine used to power the A380.

The company, we are told, now expects to deliver only 28 of the £10 million engines this year and none next year. Rolls-Royce says it will be reviewing whether any job cuts will be necessary when further clarification on the A380 programme was given by Airbus.

Airbus Chief Executive Christian Streiff, however, does not have that luxury. He has announced the launch of an Airbus revival strategy called "Power 8", which will involve a 30 percent cut in costs, primarily from job losses.

Interestingly, Airbus is also reassessing its production centres, with Streiff understood to be keen to strip out the cost of shipping aircraft parts around Europe. At present, different sections of each aircraft are built in regional plants and then shipped to Toulouse for final assembly.

This model may be changed so that each plant produces one full aircraft, with projected cost savings of €2 billion (£1.35bn) a year from 2010.

The production centre assessment will be completed in about four months' time and will be key to determining the future of the UK division at Broughton in North Wales. The plant makes wings for Airbus that are transported to Toulouse by a tortuous route that includes barges and specially modified lorries.

Yet, at precisely the time Airbus seems to be abandoning dispersed production, Boeing is buying into that model big time, with the launch of a new 747 variant, the so-called "Large Cargo Freighter", an aircraft so ugly that "only a mother could call it pretty."

At least three of these aircraft are planned to deal with shipping 787 components which are being manufactured in all 50 states in the US and in countries as far afield as Japan and Australia.

With A380 wing production at Broughton apparently now also suspended, it is beginning to look as if throwing our lot in with the Europeans was the wrong call.