Aerospace Sector Deal: One Year On

Aerospace Sector Deal: One Year On Aerospace Sector Deal One Year On 1 Aerospace Sector Deal: One Year On Foreword The UK aerospace sector brings innovation, expertise and experience to developing and manufacturing advanced technologies at the heart of modern commercial aviation. Aviation is essential to connecting people across the UK and around the world, and the industry has been working consistently for decades to reduce fuel use. Driven by technology, each new generation of aircraft is on average 20 percent more fuel efficient than the generation before, and the UK aerospace sector has played a key role in driving these efficiencies. Now worth £36bn a year to our economy, Colin Smith CBE – Co-Chair, this industry directly employs over 111,000 highly skilled people in jobs that pay 45 Aerospace Growth Partnership percent above the national average and are programme, is starting to build UK consortia spread across the breadth of the UK. of the best proposals for developing low As a result, this is a sector that ‘levels up’ carbon, environmentally friendly, advanced the economy – with 92 percent of the sector aerospace technologies of the future, adding based outside of London and the South to the high technology programmes being East. run by the successful UK Aerospace Research and Technology programme Since the Government and industry first delivered through the Aerospace came together at the end of 2010 to create Technology Institute. the Aerospace Growth Partnership, we have seen UK aerospace employment grow by 15 Reducing carbon emissions and achieving percent, while exports from the sector have Net Zero by 2050 will be at the heart of increased from £18bn in 2011 to more than Government’s economic strategy. Clean £34bn a year in 2018. growth presents an opportunity across the whole UK to improve productivity, drive The Aerospace Sector Deal launched in economic growth and reduce inequality, December 2018 was another landmark particularly for left behind places. As we look event in the partnership between to the future of aviation, our whole industry government and industry, which ensures we needs to be focussed on solving the can attract the investment for the UK to challenge of reducing the environmental remain a world leader in this sector and to impact of flying, even as global air travel develop the skills we need to thrive. continues to grow. In the last year, we have seen the Sector The rest of the world is accelerating towards Deal’s key programmes get underway. The a more electric future; large government- third round of the National Aerospace backed investments are being made today in Technology Exploitation Programme was the USA, Germany, France, China and launched in June at the Paris Airshow, Japan, and the UK risks being left behind if supporting innovation in the supply chain. we do not invest at scale and pace. The Future Flight Challenge, a gross £300m industry and government funded 2 Aerospace Sector Deal: One Year On The range of programmes now taking place, Supply Chains for the 21st Century is underpinned by the portfolio of research and helping small and medium sized companies technology co-funded through the to continually improve their productivity and Aerospace Technology Institute programme competitiveness. - which now totals £2.6bn and involves 331 We are also focussed on making sure our partners including 203 small and medium industry is attracting the full range of talent sized enterprises - will all be vital to we need to continue succeeding. achieving this goal. The Women in Aviation & Aerospace The UK Aerospace Research Consortium is Charter now has now grown to more than providing the global aerospace community 133 signatory organisations and we are with a centralised point of engagement to working hard through a range of initiatives to our top university aerospace research promote science, technology, engineering, capabilities. and mathematics subjects and careers to The strength of our sectors lies not only in young people, helping to increase the UK’s the ability to operate at the cutting edge of engineering talent pool. technology but in the potential of small and The Sector Deal has helped drive our medium sized enterprises in our supply industry forward over the past year, building chains to compete as world leaders. on the success of our industrial strategy for Realising the success of investing in the aerospace. next generation of technologies and shaping We look forward to the Aerospace Growth future markets, relies on a competitive and Partnership, between industry and capable UK supply chain that is positioned Government, building further continuing to exploit these opportunities. tackling barriers to growth, driving the green A robust civil aerospace supply chain in the aviation agenda and making sure the UK is UK is also essential to support our the best investment location in the world for capabilities in defence, given that suppliers aerospace. cater to both industries. 3 Aerospace Sector Deal: One Year On Background to the Sector Deal At the Farnborough International Airshow in research and development (R&D) July 2018, the Prime Minister - Theresa projects led by small and medium sized May, called for industry to work with enterprises (SMEs). government on an ambitious civil Aerospace Supporting SMEs in the UK aerospace Sector Deal, to build on the strong supply chain to boost their relationship government has with industry competitiveness through a new through the Aerospace Growth Partnership productivity improvement programme. (AGP) and support the Industrial Strategy’s Grand Challenges, regional prosperity and Committing the industry to embed a WiAA the delivery of the government’s skills Charter to increase diversity and inclusion priorities. in the sector. She also called on the sector to embed a Enhancing the joint working between the Women in Aviation & Aerospace (WiAA) aerospace industry and education Charter to bring greater gender equality to providers to ensure a strong future the industry. pipeline of talented people are available to ensure the UK aerospace sector The UK’s Civil Aerospace industry is a world remains globally competitive. leader in the development and production of engines, wings and advanced systems for The Sector Deal builds on the strong aircraft. It is a sector that has a strong record relationship between the aerospace sector of working in close partnership with and the UK government and success of this government to boost that competitive relationship has led the way to help inform advantage. the development of sector deals in other parts of the economy. The Sector Deal builds on our successes by positioning the UK to take advantage of the Looking forward, we have an opportunity to global move towards hybrid-electric and lead the world and position the UK as the electric propulsion and to exploit related new global hub for low carbon technologies, markets – drones and Urban Air Mobility including sustainable aviation fuels and (UAM) vehicles and signals the electric flight. government’s intention to position the UK at the forefront of valuable emerging markets. We look forward to working more closely with government, the wider aviation sector, The Sector Deal does this by: academia, and other collaborators, to provide solutions to help tackle climate Boosting innovation through a joint change and to drive sustainable economic industry and government investment in growth in aviation. the Future Flight challenge, with up to £125m of funding from the Industrial We welcome the Aerospace Technology Strategy Challenge Fund, matched by Institute’s (ATI) revised technology strategy industry. This programme will invest in for the UK - ‘Accelerating Ambition’, which developing demonstrators of new aircraft provides a roadmap of the innovation (such as drones and other electric necessary to make sure that the UK can aircraft), new models of airspace continue to be a global leader. management, new approaches to ground support infrastructure and new markets for aircraft in local areas. Expanding our successful National Aerospace Technology Exploitation Programme (NATEP) with joint funding from government and industry to boost 4 Aerospace Sector Deal: One Year On Progress of Sector Deal Activities Commitments were made by government and industry as part of the Sector Deal and these have been tabled in the following sections with a summary of progress against them. Ideas Industry action to support Government action to support the aerospace sector the aerospace sector Research and Technology (R&T) grant Research and Technology (R&T) grant support support Match funding R&D programme support of Match funding of government’s £1.95bn £1.95bn between 2013-2026. R&D programme to 2026. Government will look to work with industry Industry will match fund government grant to consider how best to take forward R&D support to take forward R&D. Individual and improving the effectiveness of supply grants awarded to companies will result in chains as the aerospace sector moves follow-on investments by those companies. towards more disruptive technologies. Electrification and Autonomy Electrification and Autonomy Industry will co-fund government support Up to £125m Industrial Strategy Challenge of up to £125m, Industry will also make Fund funding for the Future Flight Challenge follow on commitments in the knowledge which will implement activities to deliver that follow on R&D and capital/ more electric, autonomous and infrastructure investments will be needed environmentally friendly aviation and to develop and exploit the initial aerospace sectors. government supported activities. It will offer new options for how people and National Aerospace Technology Exploitation goods could move around in the future and Programme showcase the UK as driving new mobility solutions. Industry commit to match funding of £10m and delivery of high valued jobs in the long Small and Medium sized Enterprises term. engagement in R&D activities Prime, Tier 1’s and other larger companies SMEs already benefit from R&D funding will provide support to assist small and support through the ATI programme.

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