Vertical tail for the first A321 Jet Blue in the Mobile FAL transhipment hangar.

TIM ROBINSON reports as Airbus launches a new industrial beachhead on US soil, with a single-aisle final-assembly line (FAL) facility  in Mobile, Alabama.

In 2016, an Airbus A321 destined for US carrier Jet Blue will roll out of an Airbus factory. Not, by itself, a significant event, given that the airframer today churns out a staggering 48 single-aisle airliners a month.

This particular airliner represents a historic chapter in Airbus's history, as it will be the first A321 to come from the new Mobile, Alabama, and thus be proudly stamped 'Made in America'. Announced three years ago in 2012, the Mobile FAL is the fourth single-aisle factory to join the three others in Toulouse, Hamburg and Tianjin, China and the first Airbus FAL in the western hemisphere.

This A321 is the first US-assembled Airbus airliner.

For an aerospace giant with its historic origins and work-sharing background, the opening of a airliner factory in the land of free enterprise (and on arch-rival's Boeing's turf) shows graphically how Airbus has evolved from a European job-creation scheme to a global aerospace giant.

The historic significance of this is difficult to understate. As Airbus CEO Fabrice Bregier noted on the eve of the Mobile FAL inauguration on 14 September: "It is the most significant game-changing event in US aerospace in decades. Overnight, we have doubled the number of companies making airliners in the US".


Why Mobile?

A common theme at the opening was that Airbus feels at home in Mobile. 

So why Mobile, Alabama for Airbus's new FAL? The relationship between the city and the OEM dates back to the USAF aerial tanker contest where Airbus needed a deep-water port to send A330 fuselages to convert them to aerial tankers. Amid much acrimony, Airbus won, then lost the rebid for the US tanker deal. But in doing so, a close working relationship had been formed between the airframer and Mobile. In particular, Airbus was somewhat overwhelmed by the support from Mobile, which had lost out on wave of car factories that had opened up across the rest of the state in the 1990s. With shipbuilding, a deep-water port and a skilled workforce, it was a perfect fit for a brand new aerospace company to move in. Said Airbus chief Tom Enders of the bond between the company and Mobile: "We lost the [USAF] tanker deal, but found a great partner".


The Mobile plant

There is plenty of room for future expansion. (Airbus)

The $600m FAL at Mobile consists of some 116 acres with some 53 acres of buildings and another 116 acres set aside for future expansion. The factory is a carbon copy of existing single-aisle FALs in Hamburg and Tianjin but with minor tweaks to aid efficiency. It also incorporates production efficiency lessons from Airbus A350/A380 programmes, making it arguably the most efficient Airbus factory in the world, once it gets up and running at the full production rate. For example, there are new automated drilling machines, and extra width on the factory floor allows the Sharklet wing devices to be attached earlier in the production process. The plant currently employs 260 workers, with a total workforce of 1,000 to be employed directly at the factory - some 30% of them being US military veterans. While training has been provided, Airbus has praised the skills and experience of many of its new hires. Some, for example, come from the MRO sector and are thus transitioning from maintaining Airbus aircraft to building them.

Like the other FALs, the components arrive by sea via Airbus's logistic hub in Hamburg, having been pre-kitted up there from its supplier network. Only engines and seats come directly to the factory. However, the new US FAL does open up opportunities to refine and rationalise some supply chain links from US suppliers although Airbus say this will not happen all at once. The Mobile FAL will build A319/A320 and A321ceos initially, though Airbus say that, by the end of 2017 and start of 2018, it will switch to the new A320neo family.

Production flow at the plant.

Interestingly, the plant operates under an EASA production certificate, which has a bilateral agreement with the FAA. Though this was done with the Chinese FAL in Tianjin, this is the first time it has been approved in the US. Consequently, although it is a factory on US soil, with US workers and US test pilots, aircraft on pre-delivery test will carry the temporary French F-WWXX registration.

Major parts arrive from Hamburg via ship and are then trucked from the port of Mobile to the FAL. (Airbus) 

Though the US flag flies proudly at the entrance, it is also a global plant in more ways than one. Training, for example, has seen US workers seconded to Airbus FALs in Hamburg and Tianjin. There are even eight British Airbus workers among the first 260 staff. Indeed the next FAL plant manager, who is set to take-over in 2016, (VP and GM, FAL USA) is an expatriate Briton, Darryl Taylor, who originally began his career at Airbus Broughton as an apprentice aged 16.


What are the advantages?

The first US-built A321 out of the Mobile FAL will be delivered in early 2016.

So why open a new facility in the US at all? The opening of the new FAL brings a number of key advantages to Airbus.

First, it increases capacity. With single-aisle production now at Rate 48, Airbus is facing challenges, even with three existing plants to keep pace with the incredible demand its A320 family generates. With Rate 50 on the horizon, adding a fourth FAL, alongside Hamburg, Toulouse and Tianjin allows more capacity to be brought online for future upgrades, particularly as the ceo model makes way for the neo. The plant will hit Rate 4 by the end of 2017 but could go to Rate 8 "with very little effort", according to Airbus executives.

Second – and a related point, is that a fourth FAL adds resilience and robustness to Airbus' supply chain and production – making sure that the all-important production 'heartbeat' isn't interrupted. Some of these may be internal challenges, such as the switch from ceo to neo, but others may be external and beyond the company's control. Natural disasters or major industrial accidents could have massive knock-on effects to deliveries. The explosion at Tianjin, for example, was quickly assessed as posing no consequences for Airbus but it serves as a reminder to expect the unexpected. When the world's global airlines depend on your regular production cycle, there is no room for failure.

British-built wings in a US factory.

Third – it reinforces and regenerates Airbus' sales in the US – still the biggest aviation market for aviation in the world. Airbus, for example, forecasts that the US market will need 4,730 new single-aisle airliners over the next 20 years. Though Airbus has had no difficulty in signing up US airlines, from its breakthrough deal with Eastern Airlines in 1978, every airline competition and sales battle is extremely tightly fought. The cachet then, that Airbus can finally say it has not just US suppliers and, US customers but now its best-selling products are 'Made in America' removes the final patriotic barrier to sales in the US. Indeed, despite the fact that the Alabama FAL at Rate 4 will not be able to produce all the 100 aircraft a year Airbus expects to sell into North America. Indeed it already reports that it is being contacted by US-based airlines keen to take delivery of their 'Made in the USA' A320s on American soil.

Fourth. There are also supply chain advantages to being closer to its US customers. As with all FALs, smaller aerospace companies tend to evolve and move to be near the OEM, bringing logistics and cost benefits. While Airbus aircraft already contain approximately 40% of US content (depending on model and engines), a US FAL may provide extra opportunities for American companies and also allow Airbus to drive down costs in its supply chain. Last year, for example, Airbus bought more than $16bn of goods and services from 38 US states. One subcontractor, the Irish aircraft painting company, MAAS Aviation, is already embedded at the new Airbus Mobile paint shop,and others are expected to follow. The jobs and business boost that this 'clustering' will bring to Mobile and the state will, over time, far outweigh the 1,000 directly employed at the plant.

Workforce loyalty. A US Airbus worker sports a temporary tattoo at the opening.

Fifth. There are also workforce benefits. In particular the current non-unionised workforce allows Airbus a degree of flexibility to adjust production rates and work that would be unthinkable with strong European unions. Starting a new factory afresh with non-unionised workers allows for greater flexibility should workers need to be cut – a fact that rival Boeing also exploited when setting up its new 787 plant in South Carolina. Lower costs from non-unionised US workers may also provide leverage for the Airbus management to drive down costs in European plants.

Sixth. While airline customers in the US are important, they are only one half of the story. Put simply, the presence of a large civil aerospace factory on US soil also boosts Airbus' credentials and clout for future defence business from Washington. As noted above, the Mobile FAL originally came about as a proposed A330 conversion centre for USAF tankers, the contest which Boeing won on the second count. Thus a civil Mobile, Alabama plant makes a potential A400M in USAF markings, however far-fetched today, that much more likely. Airbus also notes that the tanker saga may not yet be over and the presence of an A320 FAL also opens up opportunities for military derivatives – such as, for example, a follow-on JSTARS – now being competed. As a US manufacturer it also intriguingly, opens up doors for Airbus to access support and help. For instance, technically it could apply to the Ex-Im bank for any A320 family aircraft built there but destined for export. A flight-test centre also raises the possibility of future co-operation with NASA on aeronautical research.

Seventh. While many headlines and analysis focuses on the traditional sales and marketing rivalry of the big two, the emergence of a second airliner manufacturer on US soil also brings with it the possibilities of co-operation between the two airframers on areas where they have common ground. Aviation safety, air traffic control modernisation and the environment are areas where both Airbus and Boeing could stand to benefit by acting as a united voice when dealing with Washington or the FAA.

The second aircraft, seen here on Station 40, is also an A321 and is destined for American Airlines. 

Finally – the opening of this facility puts the ball well in arch-rival Boeing's court. It serves as an ongoing reminder (if any is needed) that Airbus is now a global force, not just a European airframer. Today, Boeing may face even tougher sales fights on what was once its home territory.

Summary

"This is a great day for America", said Alabama Congressman Bradley Bryne. 

For Airbus, the opening of its latest FAL adds greatly to the company's transition to a global, not just European, aerospace entity. In the 1980s the big three US airliner companies, Boeing, Lockheed and McDonnell Douglas, discounted the threat made by this cheeky European upstart with its funny fly-by-wire airliners and silly sidesticks. Today, only Boeing remains, and the enemy is at the gates.

The opening of Airbus' US FAL then, is a graphic example of today's global aerospace industry where the location of factories is driven not by national preferences, historical ties, or legacy buildings – but by cost bases, market opportunities and partnerships. There is also now no such thing as a purely 'European' or 'US' airliner – so interconnected and intertwined are global supply chains spread out across the world.

'Made in the USA', Fabrice Bregier and a local Mobile worker attach sign to the first US-built A321. (Airbus)

But the relationship between Airbus and Alabama goes beyond simple business choices – as one executive noted: "if they had wanted low-cost labour, they would have just set up in Mexico". Instead, the partnership, forged in the heat of battle in the tightly fought tanker contest, now has produced a place in America where Airbus naturally feels at home. As Fabrice Bregier said during the inauguration: "Today Airbus is becoming truly global ... and a truly American manufacturer".
 

 


16 September 2015