Aerospace and defence: here the recovery can take off

The aerospace and defence industry in Europe produces a turnover of 260 billion euros and employs 890,000 people. The sector, as Alessandro Profumo, CEO of Leonardo SpA and since September president of the AeroSpace and Defence Industries Association of Europe, said, will be a point of reference for many of the priorities identified in the European post-Covid recovery agenda.

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Aerospace Dossier

of Virna Bottarelli |

The aerospace and defence industry is a strategic sector for Europe in terms of competitiveness and innovation capacity. It is represented byAeroSpace and Defence Industries Association of Europe (Asd) Alessandro Profumo, CEO of Leonardo S.p.A., is the president of the association. Leonardo S.p.A. In his inaugural speech, Profumo pointed out that the aerospace and defence industry will be a reference point for many of the priorities identified in the post-Covid recovery agenda, starting with sustainability, technological sovereignty and digital transformation.

The same sector, moreover, seriously affected by the pandemic, must recover: in mid-April 2020, flights were reduced by almost 90%, in Europe and worldwide, compared to the same period of the previous year and, despite a slight recovery in the summer of 2020, air traffic in the Old Continent will mark for 2020 a -60% compared to 2019.

Considering that aeronautics, space, defence and security are intertwined supply chains and technologies, it is clear that the crisis has had an even more pervasive impact. As Profumo wrote in the introduction to Asd's 2020 Report: "What is at stake is not just the short-term economic success of our industries, but Europe's technological sovereignty and long-term competitiveness. What we need now is unwavering support from national and European institutions and a general recognition of our industries as an indispensable resource for the European economy. Aerospace, defence, space and security can play a key role in Europe's recovery and in bringing us back to industrial leadership: a strong and sustainable European aerospace, defence and security industry is at the heart of a strong, united, technologically independent and resilient Europe."

Aerospace in Europe

In 2019, Europe's aerospace and defence sector produced a turnover of €260 billion, recording a 5.2% increase in sales. In 2020, the shock brought about by Covid-19 was tremendous: demand for new civil aircraft slowed down dramatically and, as of today (December 2020, ed.) there is no certainty as to when air traffic will reach pre-pandemic levels again. As Jan Pie, Secretary General of Ads, explains: "Given its economic weight, a complete collapse of civil aviation would also drag down defence, space and security, markets that are not large enough to offset the implosion of commercial activity. However, as these are (mainly) public markets, the EU and its Member States can use their procurement and research budgets to directly support these two strategic sectors. This would also help stabilise the civil aviation sector until the global commercial market recovers."

Aerospace in Italy

L’Aiad is the Confindustria (Confederation of Italian Industry) federation that represents Aerospace, Defence and Security companies in Italy. It includes almost all the national high-technology companies involved in design, production, research and services in the civil and military aerospace, naval and military ground sectors and related electronic systems. The aggregate data for all sectors, referring to 2019, indicate a total turnover of 16.2 billion euros, 70% of which is represented by exports. The total number of employees is over 50 thousand, but if we consider the allied industries, it comes to about 230 thousand units. The value of aerospace for Italy is also told in the recent report by Deloitte "From now on - Challenges and opportunities for the Aerospace & Defense sector". According to this analysis, the sector produces an overall added value of 12 billion euros. Gianluca Di Cicco, Workforce Transformation Leader at Deloitte, points out: "Now that Italy has to decide where to invest the significant resources expected from the Recovery Fund, the A&D sector must be placed at the center of our country's recovery strategy. Severely affected by the pandemic, the Italian aerospace industry must be supported as a strategic asset, otherwise we risk losing know-how and skills, i.e. competitiveness, to established players such as France, the UK and Germany". Di Cicco also suggests adopting a strategy that favours the diversification of the companies in the supply chain, both in terms of customers and products, and that channels investments into research and innovation, "enhancing both military and civil technologies and favouring a managerial and industrial strengthening of the companies in the sector".

Made in Italy excellence

Fortunately, there are those who already seem to be directing these investments in the right way. The Campania Aerospace District, for example, is considered a European best practice in the sector. Campania is, with 68 approved project proposals, the first European region for success rate on Clean Sky 2-Horizon 2020 funds. The District offers its member companies support and advice on opportunities for access to European funds, thanks to the DAC4EU desk, and in December organized an event on the evolution of aeronautical research in 2021, which illustrated the latest H2020 calls dedicated to the Green Deal, regional initiatives, the calls Mise, Horizon Europe, Clean Aviation and Urban Air Mobility. "The aeronautical and aerospace sector plays a key role in the regional economy, due to its qualified industrial presence and high technological know-how. A dynamic and attractive sector that in recent years has seen talents from Campania return from abroad to focus on our territory and launch innovative startups in rapid expansion," says Valeria Fascione, Councillor for Research, Innovation and Startups of the Campania Region.

The Lombardy cluster, which accounts for one third of exports in the Italian aeronautics sector, also occupies an important place in the sector, particularly as regards helicopters. In addition to Lombardy and Campania, Piedmont, Emilia Romagna, Liguria, Tuscany, Umbria, Lazio, Abruzzo, Sardinia, Puglia and Basilicata make up the National Aerospace Technological Cluster (Ctna), whose members include AIAD, Asi, Avio Aero, Leonardo, Cira and CNR. Last October, Cristina Leone, from Leonardo, was confirmed as president of Ctna: "Ctna will be committed to the mission of developing innovation, which we expect will be strongly supported through the tools that the government will decide to put in place to get out of the crisis due to Covid," said the president. The cluster is also called to update the three-year plan, "so that it can better meet the needs of the industry, which is currently suffering from a significant reduction in turnover due to the crisis in air transport".


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