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Airbus Group CEO Tom Enders AIAA keynote

American Institute of Aeronautics and Astronautics (AIAA)
22 June, 2015, Dallas, Texas

Good morning. And thank you.

  • It is good to be here in Dallas, near our largest and oldest Airbus Helicopters U.S. operation in Grand Prairie.
  • And Texas is synonymous with aeronautic and astronautic innovation and accomplishment.

It was here in Texas, at Rice University, that President Kennedy delivered his famous speech about going to the moon.

  • We remember the speech for the famous quote — the rationale he offered for innovation and embracing a great challenge.
  • He said, we do things “not because they are easy, but because they are hard.”

That’s a great line. It’s inspiring. One for the history books, for sure. But I also ask you to remember how he began that speech.

He said that “the greater our knowledge increases, the greater our ignorance unfolds.

To show what he meant, he asked us to condense 50,000 years of human history into just half of a century. And by that measure, he said, we know barely anything about the first 40 years. We learned to write and use a cart with wheels and with a horse only five years ago.

“Last month electric lights and telephones and automobiles and airplanes became available… Only last week did we develop penicillin and television and nuclear power.”

Kennedy laid out a pace of progress both dizzying and dazzling. And that’s before the arrival of big data and the technologies we talk about today.

  • Nanotechnology. 3D printing. Connectivity. Composites.
  • They are all becoming standard on modern aircraft like our latest aircraft – the A350 – and our competitor’s aircraft, the 787

I ask you to think about Kennedy’s speech because of the inherent optimism. That anything is possible because we’ve already accomplished the unimaginable.

There was good reason for that optimism back in the 50s, 60s and 1970s. Think back to that post war era.

  • Chuck Yeager, one of my heroes, breaking the sound barrier. Only seven years later, Air Force aircraft were already doing Mach 2.
  • The first transatlantic jet passenger service.
  • The first weather satellite (Tiros I).
  • Then, at the end of the ‘60s, mankind walking on the moon.

To kids like me this all meant there were no limits. The moon. Mars. Captain Kirk and Dr Spock. Nothing seemed to be beyond our reach.

We were moving faster and farther than ever before.
Electronics were getting smaller and the web was getting bigger.

By the time we launched the International Space Station at the turn of the millennium, our real time progress rivaled Kennedy’s condensed clock.

But times have changed. Internet usage. Coding, apps, networking, big data… that’s what drives progress today.

It is no longer nations that are funding and leading the revolution. It is more and more individuals. Entrepreneurs. Disruptors.

People who innovate by believing it is easier to ask for forgiveness than for permission… though, to be fair, they don’t exactly ask for forgiveness either.

I believe it was Eric Schmidt described many of these tech companies as “permission-less businesses.”

They simply move too fast for regulation.

This raises some important questions. And there is no better place to ask them than here at AIAA.

  • Was our pace of progress in the 50s and 60s, well into the 70s, sustainable?
  • Or did it create false expectations?
  • Can this industry drive technological progress again?
  • Or, are we being unrealistic assuming it?

Whether the goal is Mars or closer to home, can we honestly say that today we are doing enough – fast enough?

That seems like a strange question. After all: connecting people – faster – over longer distances – that’s still the business. Has been since the first commercial passenger flight to Tampa Bay 100 years ago.

So is using that technology for defense, satellite communication or exploring the stars.

Making things fly – our motto at Airbus. That’s what we do – what all of us do. And there is more demand than ever.

  • That Tampa flight had just one passenger.
  • In the 100 years since, there have been 65 billion passengers.
  • And there will be the same again in the next 15 years, as air traffic doubles from today’s levels!

This means airlines will need nearly 30,000 new, efficient aircraft in the next 20 years – just in the next 20 years – to stay competitive.

Incredibly, we’re probably seeing the same production rates for communication satellites soon:

  • Companies like Airbus and our competitors used to build, I don’t know, about 10, 12, maybe 15 huge satellites a year. Unit prices were usually in the double or often triple digit millions.
  • Now, with the OneWeb global constellation project our new US factory will build hundreds of units –at less than 150kg (a little bigger than a fridge, shall we say) and less than a million dollars a shot – partly using technology developed for the A350.
  • And the best thing is it won’t just transform our industry. It will transform the lives of millions of people around the world by opening the internet in an entirely new way:

It’s a great reminder that astronautics is not just about reaching out to other planets or galaxies. It’s about improving – it’s about protecting life on the planet we already have.

That potential is also clear in some of the other extraordinary achievements we’ve seen recently.

Think about the Rosetta mission, for which Airbus was proud to be the prime contractor.

  • Rosetta was launched on Ariane 5 back in 2004.
  • Solar propulsion was a daring choice to power a ten year – a ten year – trip outside the asteroid belt, 800 million kilometers from the Sun.
  • Yet Rosetta was able to swing past Mars before placing the Philae lander on a comet only 2.5 miles in diameter – travelling at 34,000 mph.
  • That solar gamble paid off again last week, with the asteroid coming closer to the sun, and Philae coming back to life as the batteries recharged.

And – if you’ll pardon the pun – Philae is just scratching the surface of what this industry has yet to explore!

That’s why aeronautics and astronautics are starting to attract attention also in Silicon Valley and in the IT industry.

Sure, apps are handy. But this is the stuff we all dreamt about as kids.

Now, thanks to Rosetta, today’s kids think it’s normal to get tweets from a robot hurtling through space on the back of a duck shaped comet!

So lord knows what they dream about!

But, we in our aerospace industry can’t take progress for granted. Not with more and more competition from “outside” traditional norms.

It’s not just the big names. It’s a whole new wave of young entrepreneurs, mostly here in the US.

They are the new “disruptors.”

As the Harvard Business Review explains: “Disruptors sell what customers want and let competitors sell what they don’t.”

The researchers said the power of disruptors is to decouple what people actually want to consume from other content and costs.

We’ve seen this with everything from the advent of the Ford automobile to the arrival of the Uber app.

As Henry Ford famously put it: “If I’d asked people what they wanted, they would just have said a faster horse.

And as the Harvard guys put it: “These startups are like fleas on the backs of dinosaurs too big to do much about it.” On the back of dinosaurs.

Think of Kodak.

  • They invented the digital camera back in 1975 – a big thing.
  • But they missed their own trick while protecting their film business.
  • They got leapfrogged right out of the game.

If this industry wants to avoid its own “Kodak Moment,” we must balance incremental progress… lower risk, solid and steady performance – which is obviously good for profits and shareholder value – we must balance that with true disruption.

And we can’t miss the revolution right under our noses.

So we need to pay more attention to the new players – not only their products, but also their perspective – their philosophy of innovation.

More importantly, we need to be open to partnering with them. To working with them to shape new opportunities for the future.

Why? Because until recently, our worlds did not collide.

That’s changing.

People used to say the Airbus-Boeing duopoly would be broken up by the Chinese, Canadians or Brazilians.

Well they are still out there, and I – for one – certainly do not underestimate them.

But what if suddenly there’s someone else?

What if change is coming not from another country or company, but an entirely different industry?

Some of you might have heard of AirWare.

  • They are a heavily backed drone startup a Silicon Valley, with investors like Intel.
  • This spring, they released their operating system for commercial drones.
  • By making it affordable they are democratizing the market.
  • Not just by making the technology affordable.
  • But by decoupling the clever bits from the airframe – the operating systems, autonomy, control laws and so on – which means they can be used with any platform.
  • They have already signed up GE as their first large enterprise customer.

It’s easy for people like us particularly in the industry to believe the tech guys are playing in somebody else’s backyard.

  • But if they are, I believe it’s only temporary. Whatever your industry.
  • And what if they overturn an industry just by accident?

Take the Oculus Rift. Everybody’s heard about that probably in this room. Palmer Lucky made it as a cheap virtual reality headset for immersive gaming.

  • Facebook didn’t buy it – I think they paid a couple billion – because they want to play.
  • They bought it because they want a communication revolution.
  • But if this kit lives up to the hype, could it have implications for air travel? Will it have implications for the entire tourism industry?

These guys don’t play by a different set of rules. They make them up as they go along.

In our world, as I mentioned, the A350 and 787 are game-changers.

  • But Elon Musk reckoned spending $20 billion to improve aircraft performance by 10% was lame.
  • Google’s 10X philosophy is to make something 10 times better not 10 percent better.

For the traditional industries, incremental change is important.
For ambitious tech companies, it’s insignificant.

We tend to “save early, save often.”
They prefer to “fail early, fail often.”

And when they do fail, it can enhance their reputation as being innovative and entrepreneurial. What a crazy world.

If someone in our industry fails it can be devastating.

The very consequences of potential failure drives a lot of our technical and financial regulations.

As it should.

But these are concerns that many of these new permission-less businesses consider a nuisance – if they consider them at all.

To be sure ladies and gentlemen, safety must be paramount.
Always. But do we use restrictions as a crutch?

  • We can never compromise on safety, but do we use regulations as an excuse, at least sometimes?

I wonder. And I think those are questions we must ask and

answer ourselves in the aerospace industry very honestly.

If we are to learn and benefit from this new environment…

If we are to draw advantage from the tech revolution….

If we are to thrive when the lines between cooperation and competition get blurred…

Then, yes, we must protect the safety critical parts of the business. But we must also rediscover the appetite for risk and speed and energy that hooked us on this industry, if were honest, in the first place.

The two can – must – live side by side.

To do that, we must overcome not only the excuse of regulation, but other obstacles, as well. Barriers that are neither technical nor scientific, but which define our future none-the-less.

  • Barriers to trade that get in the way of transatlantic growth.
  • Barriers to trust that get in the way of contracts awarded on merit or allies sharing equipment.
  • Barriers to co-operation between civil and defense that get in the way of dual-purpose technology or certification.
  • Barriers to public-private partnerships that get in the way sometimes of research and development.
  • Barriers to market entry that get in the way of young entrepreneurs with amazing ideas and the energy to match.
  • And barriers ladies and gentlemen to cross-industry collaboration that get in the way of creativity, competitiveness and progress.

They all prevent us from moving fast enough. I could probably deliver a separate speech on each, but not at 8 o’clock in the morning. I’ll spare you.

Instead, I’ll close by mentioning two areas. If we can break the barriers in these areas, I think the others will follow.

I’m talking about culture and talent.

I mentioned the Google 10X culture. It’s what makes them tick.

What distinguishes the start-up, technology community is their focus on being bold, regardless of risk or regardless of offending anybody.

Our energy must go towards riding the tech wave, not protecting ourselves against it. This industry was the driver of technological progress in the 50s and 60s and beyond. We were bold too!

In fact, when we launched Airbus back in 1969, we weren’t just bold, some would say we were downright rude. And it worked!

  • This industry needs to recapture that pioneering spirit.
  • To find ways to work with new, audacious partners.

Ladies and gentlemen, Airbus is doing that in three ways.

1.  One, by strengthening technology and incubator networks across Europe, Asia, India and the US. That includes:

  • So-called protospaces on our big engineering campuses giving engineering teams 100 days to crack problems and create prototypes.
  • Innovation hubs working on big-data analytics and high-performance computing.
  • And so-called BizLab accelerators cutting the time to commercialise innovations from our own people or from external start-ups.

2. Number two, we’re building on our academic partnerships.

  • Like joining Virginia’s Commonwealth Center for Advanced Manufacturing (CCAM).
  • Industry, academic and government pushing breakthroughs in manufacturing and applied research with some great partners.
  • Such tie-ups are vital. After all, Apollo’s guidance system was almost entirely built by the MIT instrumentation lab.
  • My observation, industrial-academic partnerships ladies and gentlemen have atrophied over time, and not only here but throughout the western world. We need to re-invigorate them.

3. And three, we’re tapping into innovation hubs and cultures that reach beyond our traditional scope.

  • That’s why we have set up venture capital and disruptive innovation teams in Silicon Valley.
  • We’ve brought in expertise from famous venture capital team Andreessen Horowitz and Google to join a diverse team from across Airbus.
    • It’s undoubtedly opening up our existing innovation networks to new environments.
    • It’s adding value for us and the new partners we’re discovering along the way.
    • And it’s positioning us hopefully to disrupt the industry before somebody else does it for us.

I promise you: when it comes to the future of aeronautics and astronautics, Airbus will be building it, not just watching it!

This industry helped us grow from a European upstart to a global partner. We owe it a lot. Now we want to help get it back to leading the very best of science and technology.

That brings me to my final point.

Inspiring the next generation of talent and closing what some call “the talent gap”.

Think back to Kennedy and to his promise. I was told the average age of a NASA engineer at the time of the first moon landing was 28 years old.

That means that when Kennedy delivered that speech at Rice, those budding technologists were 18-20 years old. College students. At least many of them.

How old is that NASA workforce today? It has almost doubled. And we could substitute probably NASA for EASA and others.

I’m not being critical of older engineers… they have a lot of experience to give. We need to capture that.

But the looming retirement of so much talent is something we can’t ignore.

And fortunately for all of us, the AIAA doesn’t.

  • One of the many things I admire about this association is the forum you give to Rising Leaders in Aerospace.
  • And I also want to thank Sandra Magnus, AIAA’s Executive Director, who helped judge the Airbus Fly Your Ideas global challenge for students around the world this year.

Airbus will be proud to keep working with the AIAA to crack this issue. And we must do more.

We know that working on great technological challenges still inspires young scientists, engineers and entrepreneurs – men and women alike.

We need to let them know that the work in this industry – their work in this industry – is as vital as ever. You don’t need to look any further than the recent G7 announcement on fossil fuels for instance to see why.

When you visit Silicon Valley, you can’t help but notice the youth, the energy and the internationality of the engineering population. Or, most importantly for us, their enthusiasm when it comes to aeronautics and astronautics.

Let’s face it – you can only get excited about so many iPhone launches, you can only stomach so many cat videos on YouTube. Nothing against cats – I have a cat myself.

But nobody – nobody – stops dreaming about what’s up there. Every rocket launch is more exciting than the last. Every aviation adventure feeds appetites for the next one.

You see it clearly in projects like, in our Group:

The Perlan II project to fly at 90,000 feet – higher than any aircraft has ever flown in level flight, let alone a glider. Yes, the Perlan II is a glider.

  • The goal is to study piloting and weather in the upper atmosphere, showcasing aviation talent at the same time, of course.
  • We’re sponsoring the project, but it’s a volunteer initiative running on a pretty heady mix of science and passion.

Another project we’re currently driving ahead with is the eFan electric aircraft, with batteries that can either be quickly recharged or swapped out for a fresh set.

  • The first version is a training aircraft, two seats, then a four seater.
  • This is not our core business. We’re not going to rival [major small aircraft manufacturers]. That’s not the purpose. But it’s accelerating the technology needed for commercial flights – for a 50-seater or perhaps a 90- or 100-seater – which we’d like to in the next 20 years or so.
  • That’s great for emissions, for noise around airports – you don’t need night flight restrictions with electrically driven aircraft – and for the imaginations of current and future engineers.
  • It’s also by the way a good example of cross-industry cooperation because a couple of our most important partners do no come from the aerospace industry.

And of course we’ve all been following the Solar Impluse.

  • Again, this isn’t going to transform us as an industry overnight.
  • But it’s an amazing achievement and a great way to get young people passionate about our industry.

These are all adventures – and many more – that get people excited no matter what their age or background or their gender.

Young people still want to take moon shots with the ball in their hands. Right now, many of them think the future is all about coding.

In fact, last year more than 800 Harvard undergraduates signed up for introductory computer science. It’s overtaken Economics as the school’s most popular class at Harvard.

They want to work at places that think fast and sell ideas faster. Our job is to let them. To create a culture that encourages bold experimentation and exploration.

And at Airbus – and across our supply chain – we are lucky to already have many incredibly talented people working for us –many of them, many of them here in the United States. The number is increasing.

But we must all do more to attract the best, most diverse talent globally. To let them thrive.

That won’t be easy. But we should do it. We should do it because it’s hard.

This isn’t about getting down with the kids in California.

  • It’s about being more efficient, more productive and more competitive.
  • Innovating where it adds real value for our business and first and foremost, of course, for our customers.
  • Disrupting this industry the way we want it to happen.

And it’s about doing it now.

If we do, ladies and gentlemen, the question won’t be: “are we moving fast enough?

It will be: “where are we going next?

Thank you very much for your attention.

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