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  • The Art of Attracting Top A&D Jobs
    Posted by Michael Mecham 11:41 PM on Jan 19, 2012

    Boeing’s decision to close its Wichita defense plant is a story of too much factory capacity and not enough work. The 2013 closure raises concerns about the future of the company’s more than 2,100 employees as jobs shift to facilities in other states.

    The Wichita story is mainly one of costs and efficiencies. With program funds drying up, Boeing felt its Wichita factory was no longer competitive. Boeing is not the only aerospace and defense (A&D) industrial leader with excess capacity. Commercial backlogs may be healthy, but not enough to take up all the slack for suppliers feeling the defense budget squeeze.

    Credit: CAE

    The pressure to boost production without adding workers is relentless. “The long-term trend is to replace labor with technology,” says Deloitte LLP A&D analyst Tom Captain. “So labor is becoming less important as a cost factor.” Instead, digital product definition and lean practices are keys to success.

    Eager to attract skilled, good paying, middle-class jobs, many regions offer tax and regulatory sweeteners and frequently pick up the tab to train new hires, providing employers offer job guarantees. But applying these strategies is easier said than done. During a recent visit to Montreal, I was struck by how much prime and Tier 1 manufacturers in Quebec—Canada’s largest A&D market—have layered their support programs to build the region’s A&D industry.

    Montreal offers government-backed programs that seed new aircraft development—providing jobs are guaranteed—and pursues foreign talent and manufacturing partners if they can boost the fortunes of the city’s A&D sector. The region’s universities and specialty schools, such as Ecole Nationale d’Aerotechnique with 900 students in a three-year program, feed the industry graduates and engage in research on its behalf. Aero Montreal, the region’s A&D think tank, has initiated a mentoring program to help small and medium-size enterprises (SMEs) learn how to move into design and manufacturing roles valued by global supply chains.

    Similar efforts can be found in numerous states in the U.S. But Montreal’s layered approach stands out.

    In Montreal, CAE is an example of growing strong locally in order to compete globally. CAE counts itself as first or second in flight simulation and training across multiple segments, including commercial, business and military aircraft. The company has focused on emerging economies since the 1970s but counts U.S. military programs as its largest customer base for such programs as full-flight simulators for the U.S. Navy’s P-8A maritime patrol aircraft (see photo).

    Leading contractors say the drive to support local industry is very strong even if it is not always satisfied. Pratt & Whitney Canada buys $4.2 billion annually from Canadian suppliers but could go as high as $16 billion if the right suppliers were available, says Senior Vice President Maria Della Posta.

    Heroux Devtek, best known for its landing gear, works with 200-300 Canadian suppliers, says Vice President Martin Bressard, general manager of the company’s Longueuil plant outside Montreal. “Lots of them are local machine shops, doing shot peening or specialized work,” he says.

    The company has learned to work closely with its own customers, such as with Alcoa on the design of a titanium/aluminum forging for the F-35 bulkhead. Heroux Devtek wants to develop the same relationship with its own ­suppliers.

    Bell Helicopter Canada is one of the sponsoring mentors for Aero Montreal’s SME development program. President Barry Kohler says mentoring is all part of the region’s heavy emphasis on technical training and managerial cooperation. “There is a lot of cooperation between us and the research institutions,” he says. “We really cooperate to an extent that you won’t see in any other city.”

    Bell has more than 200 Canadian suppliers, 50-60% from within Quebec. “Do we cluster? Absolutely, but with the caveat that the SME equation has changed,” he declares. His reference is to the rise in the value of the Canadian dollar, which deflates a longtime Canadian cost advantage. “The SMEs are going to have to take a step up, in my opinion. They’re going to have to globally source to be competitive.”

    As much as Bell supports buying locally, it sources from everywhere. Recently it built a fuselage plant in Chihuahua to take advantage of lower Mexican wage rates for its Bell 429 program. Kohler smiles at some of the ways Bell has learned to function internationally. As he points out, Bell Helicopter is an English-speaking parent company with a French-speaking subsidiary in Montreal that is now relying on a Spanish-speaking fuselage factory. The trick? The Mexicans build the fuselage without written instructions. They use symbols—31 of them—for the entire process.

    Tags: awcol

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