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Welcoming address by the Federal Minister for Economic Affairs and Technology Dr Werner Müller

"Outlook for German and European aviation"
Hamburg, 29 January 2001

On behalf of the Federal Government I welcome you most cordially to the European Union's fourth Aerospace Research Conference here in Hamburg.
It is a good sign that this Conference is taking place here in Hamburg.
I would like immediately to make clear before I begin that I am not going to talk about the "running sore" that is the legal battle concerning the extension of the Airbus site, but I hope that it will soon be healed.
The Commission is giving Germany a particularly high rating by holding this Aerospace Research Conference here in Germany.
This is also an acknowledgement of the part played by Germany in the process of Europeanising the aerospace industry.
You have chosen a worthy conference venue in Hamburg, a city which, together with Seattle and Toulouse, is one of the three major centres in the world where civil aircraft are built.
By the way, 63 years ago, or more specifically on 29.01.1938, a chemist called Paul Schlack working for the Agfa company in Berlin succeeded in inventing a new chemical fibre that later came to be known as Perlon.
This high-strength chemical fibre enabled the development of composite materials, without which present-day planemaking is unimaginable.
As early as 1976 the Federal Government began to nurture and support the development of carbon-fibre technology in planemaking via research projects.
Starting with rudder assemblies and continuing via CFRP wings in the 1995-98 research programme, we are now at the stage, in the current national programme, of working on the fundamentals of carbon-fibre fuselages.
It was, and still is, important to us in Europe to be given a competitive springboard for such an innovative branch of industry as aerospace, with its high-value jobs and high value-added products.
The national support for research and development was put to good use - more particularly in developing the Airbus and Ariane families.
Airbus and Ariane were able to achieve their commercial successes via technological innovations.
Examples of this are crossing the Atlantic with only two engines, two-man aircraft cockpits and two-satellite launchers (1) and the great reliability of the Ariane space transport systems.
These favourable starting positions should be successfully built upon in technological and commercial terms.
The European aerospace industry is a "global player".
We know our strengths and would like to share our vision with yet more partners.
This also means that trans-Atlantic partnerships are very welcome.
Thus, for example, a great many of the suppliers for the new super jumbo aircraft the A380 are from the USA.
Aerospace is a key industry for the US Government which, moreover, supports it vigorously.
European policy must find a response to that situation.
That response cannot and will not involve any race to subsidise, any ring fencing or any arrangements.
As hitherto, it will be a response embracing the principles of competition, performance and innovation.
Here, together with the German aircraft industry, and like the EU Commission, but also like our partners in Europe, the Federal Government sets great store by three decisive factors in the European aircraft industry's further development:

  • Providing integrated, stand-alone and competitive company structures;
  • Assigning a leading part to technology in the aerospace industry;
  • Coordinating national and European support for research.

Competitive company structure

The EADS is in the process of consolidating its structures and becoming an economically stable company that is independent of the State.
Thus, following the merger of Boeing and McDonell-Douglas planemaking in Europe is also on the right track, but there is still some way to go.
The amalgamation of equipment suppliers General Electric and Honeywell is a new challenge.
How will their European counterparts react to this?
I am quite aware that merging or cooperating in this area will become considerably more difficult.
However hard it may seem, closer cooperation will be unavoidable if the market share of the European equipment manufacturers is to be maintained.
Each case of foot dragging by ourselves gives a competitive advantage to non-European companies.
Our small and medium-sized businesses are not unjustifiably felt to be highly flexible.
I am confident that they will also live up to this.
However, I would like to call upon all European small and medium-sized industries to bear global threats and opportunities in mind with open-mindedness, a willingness to compromise and far-sightedness.
The large number of equipment suppliers in Europe provides adequate scope for improving the economic power and competitiveness of these.
It would be nice if we were able to make fundamental progress here in Europe as early as this year.
Where I can give those businesses political support I will do so in order to make sensible mergers easier, as in the case of the EADS.
However, the willingness of those companies is a prime factor here.
Europe's governments will have to continue to monitor and support this branch of industry to ensure that there are comparable conditions of competition in the various countries.

Technological leadership

Aerospace is and will continue to be technology intensive and thus a cost- intensive part of industry.
Since 1995 the Federal Government, together with the industry and the Federal States earmarked roughly DEM 2.5 billion for national technological support programmes, but less than one half of this is provided from the public purse.
Both the support received and its results have centred on fuselage technology, the passenger and on-board system and also the wing's high-lift systems, including its modular electronic control.
The aircraft, helicopter and propulsion projects are also largely centred on, above all, flight safety, noise reduction and pollutant reduction.
Our aim is to identify ways, through research, of being able to reduce kerosene consumption by 25-50% and CO2 emissions by the same amount by 2010.
Efforts are even being made to reduce nitrogen oxides by 85% as compared with their 1995 level.
At the same time aerospace is also at the cutting edge in applying innovations to products and processes.
I would merely like to single out, as being typical of this, laser-beam welding of aluminium fuselage skins that was developed under the aircraft research programme and, in 1999, was awarded the innovation prize by the German business community.
As I already said in the introduction, Airbus has achieved its commercial success through technological leadership.
This is only made possible by forward-looking ideas, accompanied by mastering and combining various sophisticated technologies.
In order to take the technological lead in Europe I expect that all of the results of the national and European research programmes will be examined carefully and will begin to flow into the development of the A 380s as of now.
This can also justify risk-sharing via the loan to be granted by the Federal Government and the other European Governments.
The expected doubling of Airbus jobs in Germany and Europe will be yet another feather in the caps of both sides.
It is not impossible that 4000 jobs in Hamburg are linked solely with the A 380.

Concentration of European strengths

Airbus is a European project with a broad economic impact extending way beyond the countries that are partners in Airbus.
I hope that further European countries will grasp the opportunity offered by the A 380 and pick up jobs from the 40% of the work still to be shared out.
The aerospace industry can only survive global competition as a European industry.
The national research programmes can help here.
However, the way must be paved for a commitment by the European Union that has financial muscle and is effective in industrial policy terms.
Mr Busquin has already prepared the ground well with his Group of Personalities.
The EU support must be given a firm place, with reliable continuity, within the aerospace research network.
I consider a corresponding budget within the sixth framework programme to be a suitable continuation of the key precursor programme, entitled "New prospects for aerospace".
I will work vigorously towards this together with my colleagues in the other Member States.
On the way, however, we should not forget to centre the research on the important requirements as regards quiet, low-pollution, safe and economical air travel.
These requirements cannot be met without cost, but sustainable developments give rise to not only competitive advantages but also social acceptance.
The EU, Federal and State support is an attractive offer to regional, national and European competence networks.
Finally, being successful means to produce superior innovative ideas within a competitive partnership.
The Commission and the European Governments have provided an excellent financial basis for aerospace.
The market situation is currently very good and advance orders covering several years have been received.
Seize this opportunity.
I am convinced that, in concert with science and industry, national governments and the European Union we will also be able to face the new challenges.
I hope that you will hear interesting specialist speeches, make many new contacts and enjoy personal success over the next few days here in Hamburg.

(1) Two satellites in one rocket (since Ariane 4). Previously only one was possible. (back to the text)

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