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Back with refreshed optimism and an insightful outlook on the aerospace and advanced manufacturing sectors, Colin Turner led the first WEAF CEO Industry Update of 2025. Colin provided attendees an overview of the UK government landscape and details on global influences impacting the wider supply chain. In addition to current opportunities within the engine market.
The South West region is attracting multiple start-ups due to its skilled workforce and knowledge base, with migration into other sectors like cybersecurity and offshore wind.
Recovery in a material world
Since Covid-19, it is now evident that there has been rapid recovering in civil aviation, with passenger numbers almost returning to pre-pandemic levels and long-term routes now operating at full capacity.
Chancellor of the Exchequer, Rachel Reeves MP alongside the Department of Transport announced that it would be addressing a capacity challenge at Heathrow Airport. HM Government is supportive of a third runway at the airport to unlock economic growth; Aerospace has been earmarked as one of the key growth sectors outlined by the government.
Expansion plans are also in discussion at Gatwick, Luton, and Stansted, and here in the South West, Bristol is exploring its options too. The regional airport serves 15 million passengers per year and is looking to meet future demands in its strategy, which could include terminal and runway extension respectively alongside A38 improvements to manage traffic increase.
The supply chain is still struggling with the challenges posed by energy and raw materials, particularly titanium, due to the Russia-Ukraine conflict.
VSMPO is the world’s largest titanium producer, all non-essential titanium is no longer purchased by Airbus through the organisation. Therefore, there is a still a titanium shortage which could impact market price, demand, and supply.
Aluminium has recovered and prices have now returned to pre-Covid levels. However, there are still issues surrounding specialist and high-performance steel. In general, high strength steel is exported from the US to Europe. As of 10th February, President Trump announced there would be 25% “reciprocal tariffs” related to steel and aluminium on countries who place tariffs on the US. This will be an area to watch as newly-elected President Trump determines any changes to tariffs, which will impact both sides of the pond. Whether it’s empty rhetoric or not remains to be seen.
Prime capacity
Airbus and Boeing continue to face challenges with increasing production rates. Airbus has made a commitment to get to Rate 75. In 2024, the OEM’s average rate was 63 which means a dozen short of the target. Consequently, there is a 13,000 backlog of aircraft on Airbus order books. The OEM reported that 25 deliveries had been made in January this year to 17 customers
with gross orders standing at 55. There are green shoots for Boeing as the production line of the 737 Max has restarted and its enduring quality issues appear to be being addressed.
Colin commented: “The challenge for Boeing and Airbus is how you pay for the rate increase and how you pay for the process approvals to get the capacity [met]. HM Treasury and Department for Business and Trade are considering ways of intervention in terms of access to finance for this area. [However,] there is nothing available at the moment.”
Colin explained further that industry is making its case strongly that there are market opportunities for the UK related to this area. However, the UK has high barriers in terms of the cost of regulation to increase capacity and win more orders out of what is a supply chain that is operating under capacity.
As WEAF reported in January, Rachel Reeves, Chancellor of the Exchequer, is advocating for strategies to stimulate growth across the UK through a recent series of recent announcements. One way is through elevating barriers in regulation.
She said: “There is no substitute for growth. It is the only way to create more jobs and put more money in people’s pockets, which is why it is at the heart of our Plan for Change. Every regulator, no matter what sector, has a part to play by tearing down the regulatory barriers that hold back growth. I want to see this mission woven into the very fabric of our regulators through a cultural shift from excessively focusing on risk to helping drive growth.”
WEAF encourages its membership to ensure that an effective dialogue is taking place up and down the supply chain in terms of how support can be provided to customers’ capacity increase needs. Whilst recognising this is cash dependent within the system, advice is to engage with procurement directors and buyers directly in relation to the medium- and long-term.
Propelling Progress
Regarding the Airbus A320 Neo, there are two main engine types: the Pratt & Whitney geared turbofan and the CFM LEAP engine, a collaboration between GE and Safran.
Pratt & Whitney has faced significant delivery issues, while CFM has seen growth due to fewer technical challenges, despite both experiencing supply chain problems. Pratt & Whitney supplies engines for multiple aircraft types, including the A320 Neo, A220, and Embraer E-series, which has complicated their production.
With the decline in wide-body aircraft demand, WEAF envisages potential for the UK to leverage its capabilities by integrating into Pratt & Whitney’s supply chain. WEAF has highlighted the UK’s readiness to support these procurement needs directly with the Department for Business and Trade.
Additionally, Pratt & Whitney is establishing an engine plant in Morocco, which presents another opportunity for the UK to engage with a nearby supply chain. Overall, focusing on engine manufacturing offers significant potential for collaboration with these major industry players.
Powering the Future
There is an expectation there will be a significant increase in demand over the next five years for electrical systems on board future civil aircraft. WEAF is working with the ATI to identify and support the supply chain in relation to the UK’s capability to develop and produce electrical systems, with opportunities in electrical vehicles, electric trucks, and other transportation sectors.
Uncrewed Systems and Advanced Air Mobility
There are significant opportunities within the South West related to Advanced Air Mobility and Uncrewed Systems, particularly in relation to sustainability. WEAF is exploring the potential for a cluster to support the growing number of local companies in this area and will update in due course.
Summary
The CEO Update covered the aerospace and advanced manufacturing sectors recovery and opportunities within the region. Colin highlighted the need for regulatory reforms to reduce barriers to capacity and market access. The focus was on enhancing the supply chain, particularly in engine manufacturing, with potential integration into Pratt & Whitney’s supply chain, alongside opportunities in electrical systems for future aircraft and advancements in uncrewed systems and air mobility.
WEAF continues to foster collaboration and dialogue with key players in industry and government to support growth and innovation in the South West aerospace and advanced manufacturing community.