001 TO THE RESCUE WHY FRANCE MUST PRESS ON WITH THE CONCORDE

Press, Volume CVIII, Issue 31783, 13 September 1968, Page 14

001 TO THE RESCUE WHY FRANCE MUST PRESS ON WITH THE CONCORDE

(Reprinted from the “Financial Times” by arrangement)

The British-French supersonic airliner prototype 001 is back in its hangar at Toulouse after a week of taxi-ing trials. Prototype 002 of the Concorde is being assembled at Bristol and should be ready for an official “roll-out” ceremony this month. Paul Lewis, Paris correspondent of the “Financial Times”, discusses here the importance of the Concorde project to the French aviation industry.

For the French Government ground trials of the first Concorde prototype were not only a critical moment in the history of a very expensive investment, but also a crucial step in its own efforts to build up a viable aeronautical industry with an assured long-term future. More than £2som has already been sunk in the project, which is an important enough consideration at a time when the country is bent on austerity. But equally important is the Concorde’s role in underpinning the reform of the National Aviation Industry which has been under way for the last two years and is now finally coming to fruition. Pioneer Industry France was one of the great pioneer countries in aviation history and the industry that has grown up from the exploits of its wonderful men and their flying machines at the turn of the century is today the fourth largest in the world—coming after those of the United States, Soviet Russia, and the United Kingdom. It employs about 100,000 men and has an annual turnover in excess of Frssooom, of which a fairly constant 35 per cent has been accounted for by export sales over the last seven or eight years. For some while now, however, the Government has been anxious to concentrate the industry in the face of the growing threat from the United States and the mounting cost of modern aeroplane development. Though coming later in time than the Sandys reorganisation of the British aviation sector, the motivation was essentially the same. Mergers Pushed The first move in this direction occurred as far back as 1957, however, with the formation of Sud-Aviation through a merger of the two State-owned airframe companies, Sud Est Aviation, and Aviation de i’Ouest. But the real breakthrough came only in the last couple of years. At the begining of 1967 the Government re-arranged the activities of the two major State-owned companies, Nord and Sud-Aviation, so that the former would specialise in rocketry and guided missile development and the latter in aircraft frame design and construction. Shortly afterwards it pushed through a merger between the two leading private aviation companies, persuading Mr Sylvain Floirat, the controlling share-

holder in Breguet Aviation, to sell his interest to Mr Marcel Dassault, founder owner of the firm that bears his name. Balance Of Power This was followed up by an arrangement whereby the nationalised aero-engine manufacturer S.N.E.C.M.A., took over the aviation interests of the large mixed engineering group, Hispano-Alsatienne. These include the manufacture under licence of the Rolls-Royce Tyne turboprop engines for the Breguet Atlantic and Nord-Aviation Transall military aircraft, as well as interests in the manufacture of hydraulic undercarriages, air brakes and other specialised aeroplane parts. The net result is to leave France with one State-owned airframe manufacturer, Sud, balanced by one private, Bre-guet-Dassault; one Stateowned engine firm, S.N.E.C.M.A., offset by a private one, Turbomeca, and one Government missile maker, Nord, confronting a group of smaller private firms and, chiefly, Engins Matra.

At first sight this may look like a neat Cartesian solution to the problem of securing healthy competition in a sector almost entirely dependent on Government contracts. There is probably some truth in this, though some observers feel the concentration should, and eventually will, go further, particularly in the field of engine construction, where French expertise is traditionally weakest. Assured Support In any case, the most striking feature of the industry’s present organisation is not so much the balance of private and nationalised companies, as the fact that the Stateowned Sud-Aviation is largely engaged in civilian aircraft construction, while the private Breguet-Dassault company is responsible for the backbone of the French defence system with its Mystere and Mirage fighter bomber family, and will shortly begin production of the AngloFrench Jaguar military plane. This somewhat topsy-turvy arrangement can have its disadvantages. For one thing, it means that Sud-Aviation, like some British companies, has been protected from the full force of international competition by its assured support from Air France and the airlines of the old French empire. Even its world-fam-ous Caraveile airliner was

never a really economic proposition. But in the defence sector, it can also lead to difficulties, as for instance when the French Government banned Dassault from delivering aircraft to Israel during the Middle East crisis last year. Fear About Orders However, while the latest reforms have only reinforced this division of responsibility between the State and the private sector, the Government’s principal concern has not been so much with who does what as with ensuring that everyone is going to have something to do in the years ahead. For a major consideration behind the recent reforms was the fear that the industry would face a grave shortage of orders towards the end of this decade and must, therefore, be reshaped to make the best of what there was likely to be. At Sud-Aviation production of the Caraveile is now likely to come to an end next year, and expenditure on the Mirage fighter bombers is also being phased out as France switches over in the next decade to a different system founded on submarine and land-based rockets. Demand for the Breguet Atlantique and the Transall military transport will fall away as well at the end of the 19605, and the West German Government (which was a cosponsor of the Transall) is already trying to reduce its purchase commitment. Airbus Plans The basic solution to the problem of the French industry’s order shortage in the 1970 s lies in the current Anglo-French joint aviation programme. Although France pulled out. of the VG project last year, ostensibly for budgetary reasons, another factor in the decision was the knowledge that Dassault had already developed its own cheaper version which could be developed in an emergency. But the upshot of this was to make the French Government, the firmest supporters of the Concorde, as probably the most committed to the Airbus of the three participating European Governments.

If all three remaining projects go into production, SudAviation will be fully occupied over the next decade with airframe work on Concorde and Airbus, while Bre-guet-Dassault will be handling the French side of the Jaguar programme. Even so, the industry may face a temporary order-gap at the end of the decade and Sud-Avi-ation expects to have to lay off some men next year. However, the Government may yet soften the blow by producing new Caraveile orders and it is possible that the Mirage Fl will go into limited serial production next year to take the pressure off Dassault—which has, in any case, begun to diversify out of military aircraft with its successful Falcon executive jet. Avoiding Disaster But the fact that the European Airbus must now be considered at least a doubtful starter only Increases the importance of the Concorde project in the eyes of the French authorities, already worried about rising unemployment and the technological help of the country’s industry. It is no surprise, therefore, that the rising cost of the project has not brought the same sort of agonised reactions in French official circles that has been plain in Whitehall. It is not surprising, either, that Sud-Aviation has been assured all the bridging finance it may need. For if anything were to go wrong with the Concorde and the Airbus, the French aviation industry would face disaster.