The aerospace industry must embrace competition from technology companies such as Google Inc and SpaceX, which are already having a revolutionary impact on the sector, the head of the Airbus Group told reporters in an interview.
Describing the scale and speed of innovation in Silicon Valley as both “frightening and fascinating,” Airbus CEO Tom Enders said the increasing digitalization of the economy was having a profound impact on his company’s business.
“I think that in the future, our industry will have to work much more closely with these new high-tech companies ... if only because these guys are increasingly intruding on our territory,” said Enders, 55, who is halfway through a four-year mandate at the aerospace giant.
Enders cited SpaceX Corp, the space transport firm founded by former PayPal Inc entrepreneur Elon Musk, whose Falcon launch vehicles are taking on the market-leading Airbus-built Ariane in the commercial satellite launch market.
SpaceX has also mounted a legal challenge to the monopoly held by Boeing Co and Lockheed Martin on US government satellites launches.
Google in April acquired drone start-up Titan Aerospace, which aims to compete with Airbus in high-altitude unmanned planes meant to take on tasks traditionally carried out by more expensive satellites.
“Aerospace is still a rather young industry, but these people are even younger,” he said. “And I think there is no debate as to which of us is the more vibrant industry. They are.”
“The speed of decision and risk-taking and all that is amazing,” Enders said, speaking in Normandy, France, at an event to mark the 70th anniversary of the D-Day landings.
A paratrooper officer in the German army reserves and 25-year veteran of the European defense and aerospace industry, Enders also said that the EU was stifling innovation and warned it must cut red tape.
“It should make us think as we look at the software industry, when you look at the IT industry at the Microsofts, Amazons, Facebooks, SpaceXs, Yahoos — it is all coming from the US,” he said.
Many successful entrepreneurs in the US were “bright young Frenchmen and bright young Germans” who left Europe to seek venture capital and a dynamic entrepreneurial environment, he said.
Enders was named CEO of European Aeronautic Defence and Space Company (EADS) in June 2012 and immediately attempted a merger with Britain’s BAE Systems PLC, a deal that would have seen EADS replace Boeing as the world’s biggest aerospace and defense company.
After the deal was blocked by German authorities, Enders initiated an overhaul of the group’s structure, which reduced political influence.
He rebranded EADS into the Airbus Group, reorganizing the firm into three divisions by merging its defense and space businesses. He has since led a push to expand the group’s business outside of its home base in Europe, notably in Asia, the US and the Middle East.
The Airbus Group would continue to embed itself abroad through new assembly lines, engineering centers and supply partnerships.
Enders said it was inevitable that the proportion of Airbus’ workforce employed in Europe — currently 90 percent of the company’s 144,000 staff — would fall as its international expansion gathers pace.
“If that one day would be 80 percent or 70 percent, we would still be a European company,” he added.
Airbus’ turnover rose by 5 percent last year to 59.3 billion euros (US$80.9 billion). That compared with a rise of 6 percent to 63.5 billion euros for rival Boeing.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
ARTIFICIAL INTELLIGENCE: The chipmaker last month raised its capital spending by 28 percent for this year to NT$32 billion from a previous estimate of NT$25 billion Contract chipmaker Powerchip Semiconductor Manufacturing Corp (力積電子) yesterday launched a new 12-inch fab, tapping into advanced chip-on-wafer-on-substrate (CoWoS) packaging technology to support rising demand for artificial intelligence (AI) devices. Powerchip is to offer interposers, one of three parts in CoWoS packaging technology, with shipments scheduled for the second half of this year, Powerchip chairman Frank Huang (黃崇仁) told reporters on the sidelines of a fab inauguration ceremony in the Tongluo Science Park (銅鑼科學園區) in Miaoli County yesterday. “We are working with customers to supply CoWoS-related business, utilizing part of this new fab’s capacity,” Huang said, adding that Powerchip intended to bridge
Microsoft Corp yesterday said that it would create Thailand’s first data center region to boost cloud and artificial intelligence (AI) infrastructure, promising AI training to more than 100,000 people to develop tech. Bangkok is a key economic player in Southeast Asia, but it has lagged behind Indonesia and Singapore when it comes to the tech industry. Thailand has an “incredible opportunity to build a digital-first, AI-powered future,” Microsoft chairman and chief executive officer Satya Nadella said at an event in Bangkok. Data center regions are physical locations that store computing infrastructure, allowing secure and reliable access to cloud platforms. The global embrace of AI
Qualcomm Inc, the world’s biggest seller of smartphone processors, gave an upbeat forecast for sales and profit in the current period, suggesting demand for handsets is increasing after a two-year slump. Revenue in the three months ended in June will be US$8.8 billion to US$9.6 billion, the company said in a statement Wednesday. Excluding certain items, earnings will be US$2.15 to US$2.35 a share. Analysts had projected sales of US$9.08 billion and earnings of US$2.16 a share. The outlook signals that the smartphone market has begun to bounce back, tracking with Qualcomm’s forecast that demand would gradually recover this year. The San