GKN awarded $600 million Airbus contract

GKN Aerospace Services has been awarded the contract by Airbus UK for the design and manufacture of the Wing Trailing Edge panels for the Airbus A380 Superjumbo.

The contract is worth an estimated $600m to GKN over the assumed 600 aircraft life of the programme. GKN Aerospace Services is already involved in the design of the midbox structure for the A380 wing and the manufacture of the composite flap track beams that are also structural wing components. This award brings the total estimated value of work secured by GKN on the A380 to more than $800m.

The work involved on the A380 wing trailing edge will be carried out by a number of GKN’s aerospace facilities. Design will be undertaken in Bristol and Cowes in the UK and manufacture in Cowes and in Alabama in the US, both of which already produce wing components for other Airbus aircraft.

The A380 contract will use a composite manufacturing technology developed by GKN Aerospace Services in partnership with Airbus. The A380 will be the first aerospace platform to use GKN’s Resin Film Infusion (RFI) technology rather than conventional ‘pre-preg’ composites. The technique is claimed to offer both weight and cost savings over current composite processes.

Traditionally on aerospace programmes of this type, first tier aerospace suppliers are required to invest in the up-front design and production cost of the parts they manufacture, recovering their investments and their associated financing costs over the assumed life of the programme. As well as the obvious cash flow implications, this process also entails taking risk in the quantity and timing of aircraft sales. Through a partnership with the Retirement Systems of Alabama (RSA), GKN has secured programme risk financing in the sum of $25m, thus sharing some of these up-front costs.

Part of the RSA’s charter is to promote industry in Alabama. Under the arrangement with GKN, they will provide loan-financing, repayments of which will be in line with ship set deliveries to Airbus. The loan will appear as part of the borrowings in the GKN Group accounts with no off balance sheet element.

As part of its commitment to RSA, GKN will source a significant proportion of the production on this A380 programme from its Alabama facility. This is expected to create an additional 100 jobs at the plant.

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