Reflections on 30 years in aerospace – A Q&A with Malcolm Scott
Malcolm Scott has been at the forefront of aerospace issues for nearing 30 years. His time in government saw him involved in discussions and negotiations that have helped secure the prosperity of the industry we know today. More recently, he helped create the Aerospace Technology Institute and I was delighted that he agreed to do a short Q&A to mark his retirement from the ATI and, in turn, the culmination of a fascinating career in aerospace.
His answers provide an insight into contemporary aviation and aerospace history and he is characteristically modest. But it is clear to see the huge impact that he has had on the industry, not least securing significant investment into the UK.
When did you first start working on aerospace issues and what were the key issues facing the aerospace industry at the time?
First, thanks for having me on your blog. I am touched to be asked, and I hope that the audience finds some points of interest. To start with a qualification, I have not worked 30 solid years on aerospace issues, but my first brush was when I worked at BEIS (then the DTI) and became private secretary to the minister of industry in 1992. Michael Heseltine was the secretary of state (or President of the Board Trade as he styled himself) and Tim Sainsbury was the minister. Boeing had launched the 777, and Airbus the A330/340. A big strategic debate was how far extended twin-engine operations, or ETOPS, would be permitted. It was important for the UK government because five years earlier it had put almost £500m of launch aid into the 330/340, and repayment depended on how many units got sold! In the end, of course, two engines won out, but that came later… . Another big issue – literally – was early discussions about a 747 replacement, known as the VLA for “very large aircraft” (sometimes aerospace alphabet soup is not that complicated!). The original idea was for Airbus and Boeing to collaborate on it, but the discussions failed, leading Airbus to pursue what became the A380. On the defence side, the peace dividend following the collapse of communism was kicking in, and the industry was having to consolidate hard. British Aerospace owned Rover Group at that time and sold it to BMW in 1994; a very delicate process politically. Government support for aerospace R&D then was managed through a programme called CARAD – Civil Aerospace Research and Demonstration – and ran at £20m per year.
You mentioned the early days of the A380 programme. Tell me more about the role you played in securing the UK’s significant contribution to the aircraft’s development and production.
I went to work in the DTI aerospace team proper in 1997 – now under a Labour government. The first project was supporting Airbus with launch aid on the A340 500/600 – an attempt to counter Boeing’s success with extended range versions of the 777. Airbus applied for launch aid for the A380 – or A3XX as it was then known – in 1999. The UK was awarded the wing, around 20 per cent of the aircraft. It was a lot of work to balance the politics, the economics and the commercial issues, and the final negotiation (which of course took place over a weekend) was very complicated, but everyone agreed that the project was strategically important for the UK, so sorting out the government side was slightly easier than usual. It was a huge project which reset the focus of the entire industry, but the industry was also consolidating fast at European level at this time – mainly driven by defence pressures – and as well as the changes brought about by the A380 itself, Airbus corporately became completely transformed. It’s a long story, but summarising wildly, Airbus at that time was purely a civil business consisting of elements of French, German, British, and Spanish businesses working together. There was no single corporate entity. The UK had been pushing for a more formal structure for some time, and with the A380 programme as well as the increasing commercial success of Airbus, everyone agreed that it should change. Meanwhile the parent companies (Aerospatiale, DASA, BAe and CASA) were looking at consolidation anyway. There was a lot of dancing around, but after a couple of years, everything fell into place fairly suddenly in summer 1999, firstly with Germany and Spain (DASA and CASA) coming together, then joined by Aerospatiale a few weeks later. This created EADS. Meanwhile in the UK, British Aerospace had merged with Marconi to create BAE Systems. The newly-formed EADS and BAES then created an Airbus JV with an 80/20 split. And so it was done – for the time being…
A proposed design of the A3XX. There is no doubt that the A380 leaves a legacy of innovation.
You became Director of Aerospace at the then Department for Trade and Industry in 2004. Tell me about the time your time as Director – what were the key issues you worked on?
I was lucky to be sponsored to do a MBA at Imperial College in 2000, after which I went to UK Trade and Investment (now DIT), with responsibility for trade promotion in Europe. It was fun, but as soon as the aerospace director job was advertised I applied for it immediately. The Labour government had set in train a series of sector-based initiatives – innovation and growth teams - to improve competitiveness, and the aerospace IGT had recommended a big hike in R&D spend from £20m to £70m as well as various ideas on supply chain competitiveness and skills. It created a much closer working relationship between the department and the industry and laid the foundations for the aerospace growth partnership of 10 years later that still sets the government/industry agenda today. But very soon, launch aid was again the dominant issue as Bombardier requested support to design and manufacture the wing for the C-Series in Belfast. This was a difficult case because the 100-seater market had proved hard going for numerous predecessors, Boeing and Airbus would compete against it hard, and the company was not in great financial shape. On the other hand, it was a super opportunity for Northern Ireland, and would enhance the UK’s wing capability. There were many dramatic twists in this saga, which sadly we do not have space for here, but in the end the project was agreed and we put together a package with colleagues in Invest Northern Ireland. I am glad we did; although Bombardier ultimately had to sell the project to Airbus as the A220, it is doing well in the market and has been a boon for Northern Ireland.
Bombardier, Belfast, 2018. Now of course Spirit AeroSystems, the company is the largest manufacturing business in Northern Ireland.
Airbus itself was the main show, however. The A380 project had been proceeding smoothly up to the first flight and beyond. The first aircraft was delivered to Singapore Airlines at a grand ceremony. And then things got very complicated. The French and Germans had been using different IT systems and parts did not marry up properly in final assembly – wiring harnesses were too short. It also proved impossible to provide the on-board accoutrements requested by some customers. A lot of rework was required, impacting cost and delivery, and irritating customers. The CEO Noel Forgeard was accused of insider trading. In a further bizarre twist, a senior Airbus executive nicknamed “Le Corbeau” (the crow) attempted to smear another senior colleague with bribery. Arrests were made, some people went to prison. Airbus had three CEOs in a few months before Louis Gallois and Tom Enders managed to bring calm again. Boeing piled on the pressure by launching the 787, which immediately racked up huge orders (although it was later to have its own problems). Airbus responded weakly, and it was some time before it unveiled the A350 XWB. BAE Systems meanwhile decided to sell its 20 per cent stake - awkward for us just as we wanted to win UK work on the A350. But there were opportunities too as Airbus wanted to sell parts of its operations to the supply chain. France and Germany were not keen and the sell-offs there never happened, but we saw a strategic opportunity to help create a UK-based wing capability serving the global industry - the “wing workshop of the western world” as we stylishly named it. This resulted in GKN acquiring a significant part of Filton and a major role on the A350, and becoming a global player in aerospace. Overall though the UK’s position on the A350 was disappointing, which is one reason why the Wing of Tomorrow R&D project is so important.
Out of the many other things going on at the time, I would highlight the EU/US trade dispute over aircraft subsidies, launched by the US in 2004 and not resolved until 2020. I really hope that no one has to go through that again.
In July, Airbus announced that the Wing of Tomorrow programme successfully delivered a first full-size wing demonstrator that will help mature next-generation wing technologies. The programme, launched in 2016 and part-funded by the ATI, has been investigating the design, manufacture and industrialisation aspects of novel wing concepts. Photo: Airbus
In 2009 you became British Consul-General in Düsseldorf. What are your reflections on your time as Consul-General?
Being a diplomat is a very privileged existence, especially somewhere like Germany, and it is completely different from working as a civil servant in the UK. There are no ministers to front everything up – it’s you who meets the senior politicians and CEOs, talks to the press, hosts the dinner parties, gives the speeches, and is the face of Britain. Hyperactivity and travelling hundreds of miles around the country are seen as good, as are blowing your own trumpet and racking up a huge drinks bill. In business terms, some of the job is similar to a marketing function – it ranged from nebulous relationship-building and keeping the UK’s reputation high, to concrete interventions to attract particular investments (we secured the Bentley Bentayga for Crewe, for example), support British citizens who get into trouble, and managing a range of services to the public – as well as internal management. It seems rather quaint to have diplomats trying to influence sophisticated businesspeople in their decisions, but it does work – even with the industrial elite in Germany. Helping Brits in distress is good work too, although I was lucky to avoid any huge catastrophes during my time.
In 2014 you were approached to become part of the Executive team of the yet to be established Aerospace Technology Institute. I – and many others – know you’ve made a massive contribution to the ATI but if you could distil it down to a few thoughts, what would be your key reflections on your time at the ATI?
This is where the story really starts! The downside of going abroad is that you have to re-establish yourself on your return, and it can take a while. The invitation to join the ATI was therefore very welcome from that point of view, but mainly it was a great opportunity to create something new (a rare opportunity in the public sector); and I was very keen on the ATI’s mission – I wish it had existed when I was in BEIS. The ATI has come a very long way in eight years, helping to anchor many critical capabilities in the UK, bring the sector together more, and establishing relationships abroad. The net-zero agenda is demanding new approaches, and the ATI has been fast to recognise that. The Fly Zero project was a great piece of leadership for the sector. As the industry enters a period of intense discussion about how to transition to net zero, there is a big opportunity for the ATI to help shape the high-level debate as few others have the privileged vantage point that we do. As a place to work, the ATI has been exemplary. It is full of high-calibre people, and there is a great culture of learning, openness, and support – both professionally and personally. I have enjoyed it very much and wish it all the best for the future.
Malcolm at the ATI conference, 2019
As you mark your retirement, what are the key changes you’ve seen in the world of work and in particular the civil service?
People continue to be very serious about their work, but the workplace is much less formal – when I started out in the 1980s it was still common to refer to people as Mr X and Mr Y as opposed to using first names. Individual offices have largely disappeared, and team working is paramount, at least in some departments. Smoking in offices seems like a distant memory, but it was not very long ago that it was banned. Most ministries also had a bar, with obvious implications for the quality of work done in the afternoon! All gone. Computerisation had a massive impact, as it did everywhere, although the civil service only adopted email in the late 1990s. This swept away a world of typing pools, messengers wheeling their trolleys around the place, and filing clerks. It reduced the number of personal secretaries dramatically and removed the need for every office to have a huge safe in the corner. And it speeded everything up. Social media has doubtless also changed things a lot, including in the way that officials interact with Ministers (which was always carefully controlled by the private office). But perhaps the biggest change has been in diversity, particularly the number of women in senior roles. There was always a handful of women at the top, but you only have to look at the organograms of the main departments we work with now to see the change. It is long overdue and shows how much talent was squandered in the past.
At the ATI we’ve many bright and enthusiastic people at the start of their career. What’s your advice for someone reading this who might be taking their first steps in their career?
I take no responsibility if these tips lead to people being disciplined or getting the sack! First of all, do not be afraid to take the initiative. Do not hold off just because you have not been specially asked to do something. Managers are often very poor at asking for what they want from their teams, so if you serve up something good on a plate, they will love it. Secondly, do not assume that people senior to you know more than you or have better judgement; they are often completely at sea. Thirdly, try to get around and see the world from different angles; most senior roles require a breadth of expertise and experience, so do not be afraid to plunge into a new area.
Many people will be wondering what your future plans are as you step back from what has been a long and varied career. Do you have any plans you’d like to share?
It is important to structure your life at least a bit when you retire, so as well as the usual things like spending more time with family and doing some exercise, I am going to do something at the end of my career that I should probably have done at the beginning – learn a proper skill. I am a keen pianist and working with engineers for the last eight years has also rubbed off, so putting these things together, I am going to do a short apprenticeship to learn how to tune pianos. I’ll see where that goes. I am also going to try to learn all of Beethoven’s 32 piano sonatas – I will inevitably fail, but it will be fun giving it a go.
SP: A fond farewell from all of us at the ATI. You will be sorely missed!