Will Airbus Still Make Wings In The UK After Brexit?

Airbus has significant history and operations in the United Kingdom, dating back to the creation of the company. Recent political events however, namely the UK’s departure from the European Union, have called into question the company’s footprint there. Although nothing can be certain regarding the future of Airbus UK, the company is nonetheless concerned by Brexit.

Rolls-Royce Trent XWB on the Airbus A350-941
Core components of the Airbus A350 such as the wing and Rolls Royce Engine are manufactured and assembled in the United Kingdom. Photo: Julian Herzog / Wikimedia Commons

History and extent of Airbus in the United Kingdom

Since Airbus’ first project, the A300, the UK has been involved in the European aerospace enterprise. Although the level of UK involvement fluctuated over the years, Airbus UK was formed in the 2000s. The wholly-owned Airbus subsidiary specializes in the production and assembly of wings, among other core-components.

According to the company, Airbus employs 14,000 people at 25 sites and contributes £7.8bn to the UK’s GDP. Moreover, the company engages with thousands of UK suppliers, such as Rolls Royce, and has made significant investments in research, education, and development.

Brexit concerns

” We continue to look for further clarity, and the removal of uncertainty, as soon as possible, so that Airbus, like every business in the UK, can properly plan for the future” – Airbus Spokesperson

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When the United Kingdom held a referendum on its membership of the European Union in 2016, Airbus explicitly stated its preferences for continued EU membership. According to a publication by The Telegraph, the company even backed the official pro-EU campaign.

Airbus A300 Farnborough Air Show, 1986
Airbus has made many announcements at the Farnborough Air Show in the UK. This A300 demonstrator (1986) is only one example, and is accompanied by the A318, A340-200, and A380, among others. Photo: Ken Fielding/ Wikimedia Commons

Worried, and perhaps even unsettled by the result of the referendum, Airbus has published a Risk Assessment outlining the company’s concerns. The document, which underscores the company’s increasing concern “by the lack of progress on the Brexit process”, is broken up into ‘no deal’ and ‘orderly exit’ scenarios.

No deal

“we remain concerned by a potential ‘no-deal’ and continue to plan for that scenario as that is the only way any responsible business can plan” – Airbus spokesperson

In the case of the former ‘no deal’ scenario, Airbus foresees significant disruptions to its supply chain and production processes. In turn, the company predicts that delays and associated penalties will ensue a financial prejudice amounting up to €1bn of weekly losses in turnover.

German Air Force Airbus A400M
Airbus UK’s Filton site also assembles the Airbus A400M wing, as seen on this German Air Force (Luftwaffe) example. Photo: Julian Herzog/ Wikimedia Commons

As for UK investments and operations, the Risk Assessment states that a no deal scenario will “force Airbus to reconsider its footprint in the country [… and that] key competencies [will be] grown outside the UK”.

Orderly transition

As for an orderly transition, Airbus, like many commercial entities, would certainly prefer this option to no deal. That said, the company foresees significant amounts of risk associated with Brexit, especially the transition process.

Moreover, the risk report remains bearish on the consequences of Brexit post-transition.  indicating that Brexit might invariably increase costs and complexity for all operations.

The future of Airbus UK and its wings

While one can only speculate on the future of Airbus UK, the Risk Assessment, from 2018, is not particularly optimistic. While the tone of the Assessment may in itself be a public relations tactic, the use of the phrases “reconsider’ and “refrain”, in the context of investments and operational footprint, may be telling.

Airbus Wing in sunset
With increasing geopolitical uncertainties, will the sun set on Airbus’ British operations? Photo: islandjoe/ Wikimedia Commons

From an operational perspective however, Airbus may not have much choice on where its wings are produced. According to the 2018 Risk Assessment, the manufacturer’s “industrial capabilities are already running at full capacity”.

Given that aerospace is a capital-intensive industry, it is unlikely that Airbus could relocate the production of its wings, among other parts, in the near future. Let alone, during the Brexit transition period.

What do you think future holds for Airbus UK? Will the European manufacturer relocate its production sites? Will the UK provide key economic actors more assurances on the post-Brexit future?

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atlas

They will. It is not so easy to start manufacturing wing elsewhere.
It is about politics. So when the brexit will be done, then airbus has to deal with their government and the eu, what will be next.
I think both side would like to maintain it like it is right now, so nothing will change.
But when from some reason it will be much more expensive, then yes, they will start to build a new plant in EU.

Armand2REP

If it is a no deal Brexit they won’t have a choice. They cannot afford transport delays.

Niklas Andersson

I don’t Believe it!

The actual relocation called plan “Icare” by Airbus will be in France and Netherland.

Brexit created some crack in did! it is so sad…

We hope that the turbine from Rolls Royce will not move too, like the ” smoke ” is on !

Jeff Russell

Niklas

Only just seen this site so a bit late to this discussion. Do you have any links or any more information about Airbus relocation plan called “Icare” ?

Regards Jeff

Niklas Andersson

Thomas Jérémie Hayden-Lefebvre

Excelent article…

Nigel

Businesses generally don’t like to be totally reliant on a single supplier, because it makes them vulnerable; and, yet, this is exactly the situation that has arisen as regards Airbus wings. In this case, the supplier is a country rather than a company, but the vulnerability is just as valid. Some examples: – Thailand produces 25% of the world’s hard disk drives (HDDs). When Bangkok experienced severe monsoon flooding in 2011, and several HDD production facilities were affected, the worldwide price of HDDs increased by more than 100% for a period of two years. – China produces most of the… Read more »

Nate Dogg

Nigel…..Firstly Airbus is NOT the EU. The UK is not acrimonious to Europe…they are just wakening up to the undemocratic EU that is a supposed economic block within Europe. Why should the UK pay towards infastructure upgrades to Ireland, Romania and God knows how many other EU countries? The ‘benefits’ of being in the EU are certainly lost on the UK. Secondly the UK as a country does NOT produce the wings….the wings are produced in the UK by Airbus employees. You seem to have overlooked totally the A350 with its sole supplied Rolls Royce engines. Except it is not… Read more »

Nigel

Thanks for that pro-Brexit rant…it was thoroughly enjoyable 🙂
The WTO agreement that you refer to relates to IMPORT duties…not to EXPORT duties.
And I didn’t overlook the RR engines issue…but the article is about wings, not engines.
Perhaps a cup of camomile tea would be a good idea?

Nate Dogg

The US have imposed tariffs on China and China have acted in return. Civil aviation is not included as it is exempt from WTO tariffs with the exception of clear state subsidy. It would be counter productive for the US to start imposing tariffs on Airbus as there are many US made parts. Secondly Donald Trump is pro-UK so is going to think hard about hurting UK jobs. For your info…Donald Trump is a UK passport holder along with his US nationality. If your imagination thinks there is a possibility of a circumstance change you seem to somehow ignore the… Read more »

Nigel

It seems that you’re a little behind on your reading, so here’s some enlightenment for you:

https://www.aerotime.aero/aerotime.team/22543-us-eu-threaten-tariffs-amid-airbus-boeing-dispute

https://jonostrower.com/2018/04/us-proposed-tariffs-china-imports-includes-aerospace-products/

Anyway, there’s no need for concern, is there? As you know, there are LOADS of other industrial employers in the Broughton area…so, if Airbus pack their bags and leave, I’m sure you’ll easily get a new position elsewhere.

Nate Dogg

The threat of US tariffs on Chinese aerospace goods falls into the category of state aid. The Chinese aircraft manufacturer COMAC is state owned. Its a viable reason. Airbus no longer falls into that category as it is not state owned. Secondly regarding my job at Broughton. Airbus will not shift production. You can convince yourself all you like but I have already explained on this thread that 43% of Airbus shares are held via Investment and Pension funds via the city of London on behalf of UK individuals which means that should Airbus decide to do a move out… Read more »

Jones

Hahaha, it keeps suprising how hilarious ignorance can be…

Nate Dogg

You must be referring to the ignorance of this Nigel chap. He has totally failed to grasp that there are NO tariffs on civil aviation FULL STOP regardless of EU. That is why Air France are able to buy Boeings with GE engines and not suffer import duties from the EU. A remainer (Remoaner) who totally doesn’t have a clue!! And for your info i’m an Airbus employee at Broughton. Anything else Nigel needs schooling on??

Nigel

It seems that some people don’t realize that what applies today needn’t necessarily apply tomorrow.
For example, a few months ago there were no mass US tariffs on Chinese goods, whereas today there are!
Isn’t it amazing how things can change in a short span of time?!

Nate Dogg

Referring back to your comment above about how businesses don’t like to be reliant on a single supplier. Did you totally overlook that Airbus is NOT reliant on a single supplier for its wings? It actually makes its own wings IN HOUSE at Airbus facilities in Broughton. What you means can be considered in the context of the engines on the NEO’s. It amazes me how people like you who have no clue come on here attempting to add your tuppence worth except it isn’t even that…it is ZERO worth as you haven’t got facts correct. You along with many… Read more »

Paul Spindler

I wonder if things would change if the UK created a tax free zone for all aircraft manufacturing, would Airbus consider creating a final assembly plant at Bristol if they did not have to pay any corporate taxes on their profits of such a business ?

Nate Dogg

Change like what? Airbus won’t be leaving the UK. If you read the replies to this thread you’ll realise it’s all scare stories. Besides Airbus already pay the lowest taxation in the UK of all their plants…maybe with the exception of Mobile in Alabama.

Nate Dogg

Obviously I forgot the stupid plant in China that gives away technology and know-how to the Chinese for free. You couldn’t make it up.