Amid the economic crisis and a serious fall in demand for passenger and freight transport, European and Asian airlines have reacted to falling revenues by deferring orders for new planes.
"The crisis impacts our customers" and "our manufacturing industry is feeling the pinch," Allan Cook, president of the European AeroSpace and Defence Industries Association (ASD), told members of the press yesterday (16 April).
Orders are already down and a number of cancellations have been observed, he added.
While the industry is solid, innovative and technology-based, "we shouldn't be taken for granted," said Cook, calling on the EU and national governments to increase their support for R&D to help the sector deliver the next generation of aircraft and a solid EU defence industry. But he stresssed that the industry was not asking for a bail-out plan.
Supply chain affected
Cook also underlined that the industrial supply chain, and particularly SMEs, are also struggling in the current economic context. "Therefore they need a stimulus" such a specific aerospace SME loan programme, said Cook.
"Our suppliers are being hit from various fronts and need credits and loans," agreed Thomas Enders, chief executive of Airbus and president of the German Aerospace Industries Association (BDLI). "Meanwhile, if we can keep deliveries high, that is good for our supply chain as well," he added.
Both Cook and Enders encouraged public authorities to facilitate airlines' access to liquidity for purchasing new aircraft.
Preparing for future growth and the EU emissions trading scheme (ETS)
While the long-term vision for the industry is encouraging, with trends showing a doubling of air traffic within the next fifteen years, "we need to be prepared for future growth in the sector," Enders said.
The industry's executives strongly criticised the delays caused by the European Commission regarding the effective launch of the seven-year, €1.6 billion public-private partnership (PPP) Clean Sky, which is aimed at helping the aviation sector to develop environmentally-friendly technologies.
The initiative launched in 2006 is "in great danger of suffocating in red tape," said Enders, adding that what was meant as "an inspiring PPP in line with the Lisbon goals" had become "a story of accumulated delays" struggling to get off the ground.
Industry is already contributing its share of the budget, €800m, but the Commission's internal administrative hurdles are delaying the availiability of EU money. The whole initiative is "in danger of failing and not delivering in time" for the ETS, which will further "seriously impact our airline customers," Enders said.
"We cannot afford to tie up our funds in non-functioning programmes," he concluded, adding that if no action was taken immediately, the industry would be obliged to redirect funds earmarked for the programme to other national or commercial technology initiatives.