The French government’s €15bn bailout of its aerospace has prompted calls for the UK government to do the same. But should it?
Few areas of industry have been untouched by the COVID-19 crisis, but none have had the rug pulled from beneath them quite as spectacularly as civil aerospace.
The immediate impact of a more or less worldwide shutdown in passenger flights, coupled with concerns over the longer-term impact of the virus on air travel, has had a devastating impact on a sector whose biggest problem until a few months ago was how it could continue along a seemingly irresistible growth curve whilst reducing its environmental impact.
Aerospace industries around the world have felt the impact, and the UK sector – the second largest in Europe after France – is no exception. Last month, Rolls-Royce plc announced plans to cut almost a fifth of its workforce (mainly from its civil aerospace business) 400 core jobs are at risk at Bombardier in Northern Ireland; and Airbus – which has furloughed around half of the staff at its wing factory in Broughton – is also reported to be considering mass redundancies.
Meanwhile, relations between the industry and the government are becomingly increasingly strained, with BA, easyJet and Ryanair joining forces to sue the government over its quarantine rules.
Against this backdrop, business leaders across industry are now calling on the UK government to follow France which has put in place a €15bn financial rescue package aimed at protecting jobs, driving investment in low-carbon technologies and modernising the supply chain.
Amongst those calling for action are industry body ADS Group which this week set out five priority areas for support for the industry including a pragmatic plan to resume flights, rapid expansion of government support for low carbon aerospace technology and pulling forward public procurement to support jobs and cashflow.
“Around the world, our international competitors are acting to support airlines, manufacturers and their supply chains,” said the group’s CEO Paul Everitt. “Tens of thousands of UK jobs are now at risk and the UK government must urgently put in place the measures we need to make sure our industry is not left behind.”
In our April 16-23 poll we asked whether readers think a government rescue package for the aerospace industry is warranted, and if so, what it should look like. Should government protect jobs and expertise at all costs in the hope that normality will return sooner rather than later? Should any assistance be carefully targeted at technologies and processes that will potentially give the UK a technological edge? Or should the industry be left to find its own way through the crisis, even if that means tens of thousands of redundancies and a sector vastly reduced in size?
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