Schriftenreihe der Forschungsgruppe "Große technische Systeme"
des Forschungsschwerpunkts Technik - Arbeit - Umwelt am Wissenschaftszentrum Berlin für Sozialforschung
FS I I 93-506 The Airbus Matrix:
The Reorganization o f the Postwar European Aircraft Industry
Glenn E. Bugos
Wissenschaftszentrum Berlin fur Sozialforschung gGmbH (WZB) Reichpietschufer 50, D-10785 Berlin
Tel. (030)-25 491-0 Fax (030)-25 491-254 od. -684
THE AIRBUS MATRIX: THE REORGANIZATION OF THE POSTWAR EUROPEAN AIRCRAFT INDUSTRY
Abstract
The history of the European airbus family has several implications for large technical sytems research. First, it represents the successful attempt of the European aircraft industry at breaking the American monopoly on the technical key component of global air traffic, namely the production of large passenger aircraft. Secondly, it stands for a major technical development project in which not only R&D activities of many heterogeneous and partly rivaling enterprises had to be harmonized but also the research and economic policies of various European countries. Thirdly, it is an account of the establishment and operation of a production system that—being scattered all over Europe—heavily depends on communication, logistics and other infrastructure systems. The author relates the history of European aircraft industry from the first European cooperative projects in the area of military aircraft and missile engineering up to the commercial breakthrough of the civil airbus in the 1980s. According to the author, the transition from conventional, rather rigid staff/line organization to flexible matrix organizations that are adaptable to heterogeneous conditions was the crucial prerequisite for the success of the air bus program.
DIE AIRBUS-MATRIX: ZUR REORGANISIERUNG DER EUROPÄISCHEN LUFTFAHRTINDUSTRIE NACH DEM 2.
WELTKRIEG
Zusammenfassung
Die Geschichte der Airbus-Flugzeugfamilie ist für die Forschung zu den großen technischen Systemen in mehrfacher Hinsicht von Bedeutung. Es geht dabei zum einen um den erfolgreichen Versuch der europäischen Industrie,das amerikanische Herstellermonopol für die zentrale technische Komponente des weltweiten Flugverkehrsystems, eben für Passagierflugzeuge, aufzubrechen. Zum zweiten gehtes um ein großes technisches Entwicklungsprojekt, in dem sowohl die Forschung und Entwicklung von vielen, relativ heterogenen, teilweise sogar miteinander konkurrierenden Unternehmen als auch die Forschungs- und Wirtschaftspolitik verschiedener europäischer Länder unter einen Hut gebracht werden mußten. Und zum dritten schließlich geht es um den Aufbau und Betrieb eines über ganz Europa verteilten Produktionssystems, das in hohem Maße von.
kommunikations- und transporttechnischen Infrastruktursystemen abhängt.
Ausgehend von den ersten europäischen Kooperationsprojekten im Bereich des militärischen Flugzeug- und Raketenbaus zeichnet der Autor die Geschichte der europäischen Flugzeugindustrie bis zum kommerziellen Durchbruch des Airbussen in den achtziger Jahren nach. Der Schritt von der traditionellen, eher starren Stab-/Linien-Organisation zur flexiblen, den heterogenen Bedingungen anpaßbaren Matrixorganisationen war - so die These des Autors - die wichtigste
By the mid-1970s, the European aircraft industry was considered a model of Euro
pean industrial integration. It was heavily integrated vertically. That is, beginning in the late 1950s state ministries in Britain, France, Germany and other European states, intervened to consolidate their nation's small, diverse aircraft firms into one diversified national champion big enough
to
challenge the economies of scale enjoyed by American aircraft firms. By the mid-1970s, Aerospatiale dominated the French aircraft industry, Messerschmitt-Bölkow-Blohm dominated in Germany, British Aerospace in Britain, Aeritalia in Italy, CASA in Spain, Fokker in the Netherlands, Saab in Sweden, Hellenic Aerospace in Greece, and so on.
The European aircraft industry was also heavily integrated horizontally around product consortia. Again through the active intervention of state ministries, beginning in the mid-1960s, these national champions increasingly wedded them
selves to collaborative and international projects, like the Concorde, the Airbus, the Tornado fighter, the Roland missile. To develop these aircraft, the national firms created unique consortia that dominated that product area in Europe—Airbus Indus
trie GIE in transports, PANA VIA GmbH in fighters, and Euromissile and Euro
copter. As an alternative to this European strategy for launching aircraft programs, several European firms pursued an American strategy by creating joint ventures with American firms like Boeing, Lockheed and McDonnell Douglas.
Two organizational ideas illuminate this history of integration. The first is that of the consortium form of organization. There were many ways to construct "a consortium," and those managers, engineers and politicians that rebuilt the European aircraft industry used two general types of consortia. To create the national cham
pions, state defense or aviation ministries awarded maintenance and production contracts to reward consortia that fixed the capital and manpower assets of diverse firms. These arrangements generated economies of scale, moved the firms farther down the learning curve, and rationalized the accumulation and specialization of skills, thus facilitating the ultimate fusion of these firms. During the programming of the European aircraft industry, state ministries arranged risk-fixing consortia that committed these firms to getting one new aircraft into the air, but without disrupting the capital and resource structures of those firms.
The second organizational idea is that of matrix organization. American aerospace firms in the 1960s adopted a matrix organization to depict the continuing, balanced interaction between program heads and departmental heads, and how they shared equal authority over the daily work of any individual engineer. The makers
of the European aircraft industries adopted the matrix image to show, on an interna
tional level, how the lines of functional authority in the various national firms crossed with the lines of program authority in the various aircraft consortia. The firms maintained expertise; the consortia then pulled from those firms the expertise they needed to get an aircraft into the air.
When viewed through the prism of the matrix organization, the reconstruction of the European aircraft industry falls into three periods. First, the creation of functional groups, that is, larger, more skilled national aircraft companies in the European states, beginning in roughly 1956 and peaking in 1970. Second, the crea
tion of program groups, that is, international aircraft consortia like Airbus Industrie GIE and PAN AVI A Tornado GmbH, beginning in roughly 1964 and again peaking in 1970. Third, from 1970 to the present, the consolidation of the matrix and the creation of engineering protocols to routinize transactions between the two groups.
National Champions
In 1955 the occupying forces returned an aircraft plant to Walter Blohm, chairman of the Blohm & Voß GmbH, a shipbuilding firm in Hamburg. Blohm had founded the plant in 1933 on Finkenwerder island in the Elbe to build large flying boats for Lufthansa, and then expanded it in 1936 to build transport and marine patrol aircraft for the Nazi regime. The buildings at Finkenwerder had escaped Allied bombs, but had been stripped clean of machinery by the occupying forces or Blohm's civilian ship-building plant. Blohm's engineering staff was also dispersed: some to Ameri
can, British, or French aircraft firms, others to German plants converted to civil uses.
With these civil plants and a consumer-oriented economic policy, German engineers had worked die Wirtschaftswunder, brought Germany back to die state of the art
in
many industries, and had established Germany as a stable potential member of the Atlantic alliance.
In May 1955 the occupying forces allowed the German government, on the front lines of a cold war, to begin rearming the Bundeswehr and to begin building their own aircraft. Walter Blohm wrote to Dr. Hermann Vogt, his wartime aircraft designer, and asked Vogt to return from Dayton, Ohio to run Blohm's newly re
opened Hamburger Flugzeugbau GmbH. First on the Bundeswehr's shopping list was a transport plane, not unlike those Vogt had designed during the war. Since
1951, former Nazi aircraft builders like Blohm had denounced the Allies' prohibition against German aircraft production as an economically-motivated effort to prevent competition from the German industry, arguably at a high level technologically after the war. They believed that as soon as Germans could begin building aircraft, Ger
man aircraft would dominate the international market.1
But Blohm's hopes for a quick and complete rebirth were thwarted. Vogt declined his invitation to return, citing better opportunities in America. Also, the German government was politically pressured to show its interdependence with NATO, so they bought aircraft from their new European allies. More importantly, Bundeswehr officers were uncertain about the level of production expertise in these new German firms, and wanted to be sure they could maintain foreign-bought air
craft before they diverted their expertise into designing German aircraft.
In 1957 the Bundeswehr bought fifty Nord 2501 "Noratlas" transports, to be built in northern Germany, under license from Nord Aviation in France, by a con
sortium called Flugzeugbau Nord GmbH. Blohm led the construction of the consor
tium: his partners were Weser Flugzeubau, 80% financed by the Free State of Bremen, and Seibel-ATG of Donauworth, a subsidiary of a firm that built railroad cars. The Bundeswehr insisted that, before work began in September 1958, the member firms present a plan for dividing the work, and capitalize the consortium at one million Marks, roughly the net assets of the three firms. This arrangement fixed the firms' capital, during the term of the contract, around the work-sharing agree
ments they had negotiated.
The Bundeswehr imposed a similar capitalization and work sharing scheme in 1958, when they bought 210 Lockheed F-104Gs for interception duty in the Luft
waffe. Throughout the 1950s, America’s NATO allies argued for a European production pool, that would sell standardized weapons to a central NATO pro
curement agency. The U.S. Air Force and Lockheed lobbied hard in the late 1950s to make the F-104G one such standard NATO weapon. European air forces needed such a defense-oriented, land-based interceptor, and the F-104G version would be made cheaper by stripping out its most sophisticated electronics. The U.S., German and Belgian air forces established a NATO Starfighter Management Office based in Belgium, and this procurement office bought the license from Lockheed and bought the assembled aircraft from two international consortia, literally
1 Christopher Andres, "Der Neuaufbau der Deutschen Luftfahrtindustrie, 1955-1969,"
Unpublished Magisterarbeit, Technische Universität München (25 November 1988).
Arbeitsgemeinschaften (= Arge). The Arge Nord included three German firms—
Hamburger, Weser, and Folke-Wulf— and one Belgian firm—Fokker. Because the NATO procuring office had assumed the risks of the contract, they did not require that these firms pool their capital for the contract, which was difficult given international laws.
The Arge Süd included several newly renovated firms in southern Germany—
Heinkel, Messerschmitt AG, Siebei ATG, and Domier. The Bundeswehr built and stocked a new plant near Manching to do the final assembly and flight testing of the F-104Gs. The Bundeswehr gave to Messerschmitt AG the contract to run the Manching plant, and around this plant the southern firms fixed their capital. That is, the other firms became increasingly expert at fabricating parts in particular metals, and Messerschmitt workers became more expert at assembling and testing them.
The Manching assembly line was easily converted to a maintenance facility once production ended. They began to retrofit on it small equipment that made the aircraft more German—radios, generators, hydraulic pumps-parts originating in other, more modem German firms like Siemens and AEG. Lockheed engineers taught their German counterparts much about program management, quality control and the American system of standards and specifications. The Germans hoped to parlay this understanding into subcontracts from the American firms that then dominated the world aircraft markets. And the German airframe consortia learned about modem aircraft by maintaining them, by keeping them functioning as a complete system, by integrating new, improved equipment into an established airframe. The telemetry equipment installed at Manching made it the German center of flight testing, which became especially important as the F-104Gs started crashing in the mid-1960s.2
The Bundeswehr attributed the F-104G crisis to the poor integration of the electronic equipment, and gave to the Arge Süd design responsibility to work out the problems. They brought into the investigation the firm Bölkow GmbH, led by Lud
wig Bölkow, a self-proclaimed technocrat, who had built up his firm on research and prototype contracts in electronics, missiles and helicopters. Messerschmitt envied Bölkow’s engineering team, and Bölkow envied Messerschmitt his production facili
ties. The two firms had already cooperated in the design and testing of a vertical- take-off-and landing fighter aircraft in the early 1960s, and in 1964 capitalized their
2 Kurt Johannson, Vom Starfighter zum Phantom (Frankfurt: Europäische Verlagsanstalt, 1969).
cooperation in a limited liability firm, the Entwicklungsring Süd GmbH. With the encouragement of the Bavarian state government, in 1965 the two firms negotiated a work-sharing agreement designed to culminate in an eventual merger of the two firms.3
The northern firms increasingly accumulated the expertise to design and build transport aircraft. Three of the firms merged in 1963 to form VFW GmbH after the German government offered to contract with them and Nord Aviation of France to build the C-160 Transall. Werner Blohm, now in charge of the cash-strapped Ham
burger Flugzeugbau GmbH tried to keep his firm independent, hoping to cash in as competing firms realized the sheer size of the Finkenwerder plant made it an asset in the assembly of transport aircraft. But by 1968 the German government threatened Blohm's contracts unless he merged his firm with the VFW or Messerschmitt- Bölkow combines. Bölkow was dedicated to further diversifying his firm out of military contracts and offered Blohm the best price. By 1969, the new Messer- schmitt-Bölkow-Blohm GmbH had become the leading German aerospace firm. In total capitalization, MBB was followed closely by VFW which, betting that the future of the aircraft industry lay in international interdependence, in 1969 merged with Fokker of the Netherlands.
The governments of France and Britain also led the rationalization and con
solidation of their aircraft industries in the late 1950s in order to break the econo
mies of scale protecting the American aircraft monopoly. After World War II, Brit
ain, like the United States, kept a dozen aircraft companies alive and working.
These firms formed an industrial mobilization base in case of war with the Soviet Union. By 1957 Britain decided it could no longer afford to be a world power on the saine scale as the U.S. and the U.S.S.R. The British Secretary of State for De
fense, Duncan Sandys, wrote his 1957 White Paper invoking the same images of winning weapons and technological deterrence (as opposed to mass-mobilization of conventional forces) that Dwight Eisenhower had invoked for his New Look policy in 1954. Sandys cancelled Britain’s manned aircraft programs, including its V-force of strategic bombers, to rely instead on cheaper ballistic and air defense missiles.
Sandys announced that the British aircraft industry could expect only three military contracts in the next five years, and that he had no plans to keep a dozen firms alive.
He asked them to merge “naturally” into two consortia and offered to act as a
3 Kyrill von Gersdorff, Ludwig Bölkow und sein Werk—Ottobrunner Innovationen (Koblenz: Bernard and Graele Verlag, 1987).
“marriage bureau.” As a stick he threatened to impose mergers through the
“selective allocation of contracts;” as a carrot, he promised to reintroduce govern
mental launching grants for civil aircraft.
Launching grants had been authorized by the 1949 Civil Aviation Act, but abandoned by the Conservative government after 1951 to encourage more private investment in civil aircraft. The Act also had nationalized the two largest British airlines, the BOAC (British Overseas Airways Corp.) and BEA (British European Airways). Though the airlines were free to buy the aircraft they wanted, the gov
ernment pressured them to buy British. In practice, then, the government subsidized new civil aircraft through the airlines. Before a new British aircraft could compete with an American one, a British airline had to buy the minimum launch order, make progress payments as high as 90% of the total order, and then prove that the aircraft could operate economically. BOAC lost £7.8 million when the Comet airliner lost its certification, and £22.4 million when the Britannia was delayed.
Ever hopeful, in 1957 DeHavilland sold BEA on its proposed DA 121 “Tri
dent” aircraft, and Sandys decided to make this a test case of his new rationalization policy. Working through his Ministry of Supply, in January 1958 Sandys pushed DeHavilland into forming a consortium called Airco Ltd., capitalized at £100 mil
lion, two-thirds owned by DeHavilland and one-sixth each by Fairey and Hunting.
BEA then signed a £39 million launch contract for 24 Tridents. The Trident would hold 111 seats, but because it was driven by a Rolls Royce RB. 141-3 Medway engine with 14,000 pounds thrust, it had potential for future stretch. However, early in 1959 BEA suddenly got pessimistic about seat demand. BEA told Airco to reduce the range and the seats to 87, and use the smaller RB.163 Spey engine. BEA paid Airco £333,000 for the changes, but the changes cost Airco six months of develop
ment time, and the interest of other airlines that wanted a bigger aircraft. Into this delay and market niche, Boeing launched their 131-seat 727. The 727 ultimately sold over 2,000, while Airco sold only 115 Tridents.
In July 1959 Sandys created a new Ministry of Aviation to get the national airlines out of launch policy, and to oversee the rationalization of the British aircraft industry. In three months—November 1959 to January 1960—the British firms sifted themselves into two airframe and two engine companies. Sandys had already let one major military contract following his 1957 White Paper, for a multi-mission fighter jet called the TSR.2. The consortium of firms working on that contract—Vickers- Armstrong Ltd., English Electric Aviation and Bristol—pooled their stock into a
holding company called British Aircraft Corporation. Hawker Siddeley Aviation took out bank loans to buy up its collaborators, like DeHavilland, to form the more vertically-integrated and diversified of the two national firms. Satisfied, in 15 Feb
ruary 1960 Sandys announced that he would only give contracts or launch aid to these two firms. Those that resisted, like Handley-Page still under family owner
ship, went bankrupt and were liquidated into assets that the two national champions then bought.
Now that British aircraft firms were larger and better integrated, Sandys hoped they could regain the market share they had lost to American firms since the early 1950s. In 1953 British firms produced 2,000 airframes per year; by 1960 they produced only 510. By 1960 American firms held 90% market share of the Free World’s military aircraft, and an 80% market share in civil a irlin e rs .O f course, the American military bought 75% of all military aircraft, and American airlines bought one half of all commercial aircraft, but American firms also dominated the export markets. The Americans held such a large market share because they produced so many aircraft that they could keep the price of each aircraft very low. By entering as subcontractors or maintenance contractors, some of the German firms broke the vicious cycle of economies of scale that had locked them out of the American air
frame industry.
However, Sandys did not want Britain to be reduced from its second rank among the free world’s airframe producers to being a subcontractor to American firms. Thus, from 1960 to 1965 the British government directly financed their air
lines’ “buy British” policy through launch aid, that is, an “interest free financial contribution to the launching costs of a civil aircraft or aero-engine project, repay
able as a levy on sales and licenses.” Allowable launch costs included one-time expenditures on design, testing, jigs, tools, and worker training. The staff of the Ministry of Aviation evaluated each firm’s proposed launch costs and the prospects of sales. If approved, the government gave a one-time payment of half that amount.
Because the firm had to raise the other half, and would get no more government funds, theoretically the usual risk rules applied. In 1961 the Ministry of Aviation approved the launch of two civil aircraft—the BAG 1-11 and the HSA—intended to
4 Ministry o f Aviation, Report o f the Committee o f Inquiry Into the A rcraft Industry under the Chairmanship o f Lord Plowden, 1964-1965. Command 2853 (HMSO, December 1965) 9-11; Hayward, Keith The British A rcraft Industry (Manchester University Press, 1989).
compete directly with the Americans, and consolidate Britain's position as an air
frame producer.
DeGaulle especially hoped to break what he called the "American coloniza
tion of the skies."5 By 1960 French aircraft firms were already well integrated on a regional basis and, as state-owned enterprises, already had access to government launch funds. (The government had nationalized the six firms that had collaborated with the Nazis, leaving private only two military' aircraft firms--Dassault and Breguet.) Following a typically technocratic Cold war pattern, in the early 1960s DeGaulle initiated a series of large, flashy, cooperative, aerospace projects.
DeGaulle hoped to build a European defense bloc, beginning by weaning the Ger
mans from America which had just signed an arms eo-production treaty in October 1964. Still, the Germans remained interested in DeGaulle's proposals. They wanted to be good Europeans and knew they could also learn, and profit, from working with their European neighbors.
In 1965 the newly-instated Labor government in Britain inherited a real fiscal crisis, and inherited several aircraft programs already well-delayed, too closely optimized to British needs to find big export markets, and too expensive for the small British market. Denis Healy, the new Secretary of State for Defense cancelled the three military aircraft programs and bought three much cheaper American air
craft—the F-4 interceptor, the C-130 transport, and the F - l l l strike bomber—on American credit and American promises that half of all the equipment on each air
craft would be British. And Healy started talks with DeGaulle, and later with the German government, about cooperative aircraft projects. Not only would a strategy of European collaboration break British subordinance to American firms and stop the brain drain out, but it gave them access to other national treasuries, multiplied the number of potential customers, and forced British firms to design more multi
mission aircraft.
By 1965, then, Germany, France and Britain were well along in consolidating their aircraft firms into clear national champions, through capital-fixing consortia and government directed mergers. Some state ministries had directed the invest
ments of these aircraft firms in the same way that other state ministries direct foreign policy. In the technology-charged politics of the mid-1960s, each national govern
ment then injected into their new aircraft firms pan-European politics, pan-European
5 John Costello and Terry Hughes, The Concorde Conspiracy (Charles Scribner's Sons, 1976)41.
money, pan-European goals. They programmed the European aircraft industry around individual aircraft--the Concorde, the C-160 Transall military transport, the Roland missile, the SEPECAT Jaguar strike aircraft, the Alpha Jet trainer, the Tor
nado fighter jet, the Airbus. It is significant that the European governments launched many programs simultaneously; therein lies the creation of the matrix organization.
Matrix Organization
American management consultancies in the early 1960s began packaging and selling the ideal of matrix organization and program management, as management consul
tancies are wont to do, as a miracle cure to all industrial ills. Program management had already become a fixture in most high-tech industries—large civil works, nuclear power plant construction, computers—largely because it was such a visible part of American efforts to expedite the development of the Atlas and Polaris ballistic mis
sile programs. Program managers generally invoked a package of fancy managerial techniques-PERT charts, systems engineering, concurrency and redundancy—to cut through existing bureaucratic obstacles and insist that every firm working on an air
craft or missile keep to their schedule and performance specifications.
That is, program management teams dedicated themselve to the technological system rather than to building up firms and other engineering institutions. Both institution builders or program managers might work for either a government or a corporation, either in design or manufacturing, in one country or another. But they both advanced up their respective hierarchies with differing strategies: institution builders by accumulating talent; program managers by finessing deadlines.
When Jean-Jacques Servan-Schreiber called on Europeans to respond to The American Challenge, he warned against not only the growing technology gap between the two continents but also the growing managerial gap.6 American firms consistently beat their European competitors to market, which was how they raised cash to buy European firms. So European aerospace firms in the late 1960s sent their young engineers to American business schools to study NASA and Air Force methods of program management. Back in Europe they wrote textbooks and
6 Jean-Jacques Servan-Schreiber, The American Challenge (1967).
founded professional societies to advocate the goals of program management and the image of matrix organization.7
Functional groups formed the vertical hierarchies of the matrix-like univer
sity departments, basic research laboratories, professional societies, labor unions, certifying and standards agencies, flight test teams, specialized subcontractors.
These held engineering and managerial expertise, did research, trained people, advo
cated disciplines to solving problems, and advanced the general state of the art. The more functional skills mastered by an engineer, the quicker he advanced through his department. The more functional groups a company president integrated into his firm, the more control his firm had over the technologies they used. The more func
tional groups maintained within a nation-state, the broader became its industrial mobilization base. The more functional skills developed in the European aircraft industry, the greater became its independence from American firms.
Program teams formed
the
intersecting hierarchies of the matrix. They completed tasks, like building specific aircraft, within an economy of time. They had deadlines, a patriotic mandate, and money to motivate the institution builders to work for them. The departments determined how something should be done, while the program team determined when, what, and for how much something should be done. Program managers were also directly linked across institutional borders: the program manager responsible for the aircraft prime contract reported ultimately to only one program manager in the procuring agency or airline, and the aircraft pro
gram manager demanded each subcontracting firm designate only one component program manager ultimately responsible to him.
The matrix structure descended from the line and staff structure of the large, integrated corporations that appeared in America around 1880, where it rationalized the throughput of commodities; and descended further from the line and staff struc
ture invoked by the Prussian military to rationalize the throughput of violence.
Matrix organization, in the 1950s and 1960s, rationalized the throughput of ideas.
That is, the matrix organizational chart represented the epistemologies of the manag
ers that built European aircraft. They intended the charts to structure the flow of
7 Bernd J. Madauss, Handbuch Projektmanagement (Stuttgart: C.E. Poeschel Verlag, 1984); Erwin Grochla and Norbert Thom, "Die Matrix-Organisation: Chancen und Risi
ken einer anspruchsvollen Strukturierungskonzeption," ZFBF Kontaktstudium 29 (1977) 192; Arbeitskreis Management, Empfehlungen Zum Management von Großprojekten (AKM, 1977).
information and authority through an organization so as to replace, or to mirror, their scientific methods. To an historian, the intellectual rationality of the builders of large technological systems is evident in how they divided their labors. The matrix chart, by connecting institution builders with program managers, clarifies, I think, the organizational epistemologies of all business-government complexes-those that produce agribusiness, health care, large civil works projects, or weapons.
From the perspective of a ministry of defense, the matrix indicated that the myriad firms and universities that constituted the industrial mobilization base rented their skills to a program manager who fielded winning weapons. From the perspec
tive of a corporate president, the matrix indicated he had two types of lieutenants, vice-presidents that maintained engineering, accounting or manufacturing depart
ments and vice-presidents responsible for fielding specific products. From the per
spective of any individual engineer, the matrix meant that he reported to two bosses, the department head that determined his rate of career advancement and the program manager to whom his skills were tasked.
Most social histories of technology follow one hierarchy or another—the insti
tution or the program. But the two hierarchies often touched, organizationally, long enough to solve a problem. That is, the matrix federated the two hierarchies, with
out diminishing their stores of human capital, while integrating the technology they produced. Where the two met, we find new tools of technical management; tools to sift ideas during project planning,make design decisions through systems engineer
ing, and negotiate certainty on the testing plots. 8 The functional departments were the warp, the program groups were the woof. Both were woven into a net that caught, and constrained, all the institutions of a military industrial complex or the European aircraft industry.
Airbus Industrie GIE
In 1964, at the request of British European Airways, various British and French firms began discussing a wide-body aircraft designed for the short-hop, crowded
8 The affect o f matrix organization on aircraft engineering is discussed in Glenn E. Bugos,
“Manufacturing Certainty: Testing and Program Management for the F-4 Phantom II,”
Social Studies o f Science, (May 1993); and "The Programming o f American Industry, 1954-1964," (Business and Economic History (1993).
skies between the European capitals. To describe their goals they used the then generic term "airbus." In December 1965 the German firms working together on the C-160 Transall, the successor to the Noratlas, formed a German Airbus Working Group (Arbeitsgemeinshaft Airbus) and joined in the design speculation. Various groupings of firms proposed Airbus designs, but none of the firms created formal engineering organizations with functional payrolls, because none of the firms could even expect to finance the project themselves.
State ministries, however, were willing to fund the program, so long as the Airbus at least hinted at profit. These state ministries adopted the committee form of technical decision-making. One joint evaluation committee represented the national flag carriers-BEA, Air France and Lufthansa—who judged the design proposals and decided which they would most likely buy. Air France wanted the largest possible Airbus, BEA wanted the smallest, each airline wanted a short-hop aircraft to com
plement Boeing's plans for the 747 jumbo jet. Another committee represented the state ministries who decided whether the airlines and aircraft firms had defined an Airbus that would emerge at the state of the art. (They modelled this committee after the one used for Concorde, in which the primary companies-Sud Aviation and British Aircraft Corporation-remained subcontractors to the state aviation minis
tries.) In these committees, authority was diffuse and the power to veto was wide
spread.
In September 1967 the governments of Britain, France and Germany signed an agreement for one more year of preliminary design and studies of potential Work
sharing arrangements. The state ministries had designated Sud Aviation, Hawker Siddeley and Deutsche Airbus GmbH to do the detailed negotiations. But the minis
tries still had full oversight, and the champions of national industries still dominated the champions of European products. That is, the ministries specified a “buy Euro
pean” policy rather than buying parts off-the-shelf (meaning American) and
a
policy of "juste retour" that compensated each country with work proportional to its investment capital. The French government insisted Sud Aviation be made the "pilot contractor" for the airframe, and they had already begun merging the two state- owned firms into Aerospatiale, a firm holding more of the skills needed to manage such a large project. The British government, between 1962 and 1970, had boosted the public capitalization of British aerospace firms from ten to seventy-five percent and, to recoup some of that investment insisted that the Airbus carry Rolls Royce engines (RB.207) that had not yet been built. MBB was too novice to make such
demands, but Bölkow got the German government to build up the MBB engineering campus at Ottobrunn so that they could negotiate more equally with their French and British partners. In 1968, the firms working on the Airbus still considered it less an aircraft than a reason to subsidize their diversification into wide-body transports.
Britain would not commit to the project. By late 1968, the airframe devel
opment price estimates jumped 40% (to $516 million), airlines generally doubted the delivery schedule, and a recession hit tax revenues in Europe. France and Germany were willing to pay the costs of pan-European politics, but Britain was not: they were still excluded from the European Community and the Labour government had warm ties to America. Furthermore, the British Aircraft Company kept asking for launch air for the BAC 3-11 that would compete directly with the Airbus. More im
portantly, Rolls Royce encountered design problems, so the engine no longer seemed like a big profit item. Rolls dumped its efforts (and so much capital that it bankrupt the company, leading to nationalization in 1972) into an American strategy, that is, designing the RB.211 for the Lockheed L-1011 TriStar. Rolls thought it could com
pete head to head with Pratt & Whitney and General Electric, and that they would learn nothing in
a
partnership with another European firm.In 1968 the Germans and French proposed an Airbus A300B, slightly smaller than the A300 and with a choice of engines, but launching with a General Electric engine built in France under license. The Germans and French had simply tired of the Brits' procrastination, and served notice that they considered the Rolls engine a strain on the project. In April 1969 Britain officially bailed out of the Airbus. The Germans and French signed a new agreement, in May 1969, that committed both governments to funding the redefined Airbus through flight certification. Then the state ministries largely removed themselves from the design and administration.
They would ultimately be paid back from a levy on the sales of aircraft, they rea
soned, and thus subordinated their national industrial goals to the design of an eco
nomically viable aircraft.
They gave all technical decision-making, and the responsibility for satisfying the airlines, to a Groupement d'interet Economique, called Airbus Industrie GIE.
The French government had created the GIE formula in 1967 to encourage high- technology firms to collaborate, especially internationally. 9 The GIE formula sig-
9 "Ordonnance no. 67-821 du 23 Septembre 1967 sur les groupements d'interet econo
mique," Journal Officiel de la Republique franyaise (28 September 1967) 9537. The best
nailed much more commitment to finishing a project than did a venture partnership, the liability of which was limited to the capital jointly fixed in the partnership.
Under the GIE, the total assets of every member firm were fully liable if Airbus Industrie did not deliver aircraft on time to their customers or did not pay their con
tractors. MBB and VFW took out bank loans to pay for their part of Airbus work, and the German government guaranteed these loans so that the German firms were not placed at greater risk than the state-owned French firms with access to govern
ment funds. This commitment from the firms and the governments bought credibil
ity in the eyes of the customers, and credibility was what Airbus then lacked most.
Furthermore, the GIE formula was more flexible than a merger or joint venture.
Members did not
tie
up working capital to own a piece of the program since all their capital was at risk, membership was expanded easily, and voting rights negotiated according to the size of the purchase. This meant that the capital relations of the member firms did not constrain their technical relations.Three committees sifted information from the shopfloor of Airbus Industrie GIE to the vested governments. The Intergovernmental Committee, Comprised of state ministers, met twice yearly and, for the benefit of the press, ratified decisions hashed out in the other two committees. They reiterated the commitment of the European governments to the Airbus matrix, by most fiercely debating the launch of new aircraft programs and the admission of new members firms.
The member firms—Aerospatiale and Deutsche Airbus—split the seats
on
the Airbus Executive Committee which monitored any changes to work-sharing agreements or the Airbus configuration. A Bavarian politician, Franz-Josef Strauß, chaired the Executive Committee from its inception until his death in 1988. To expand the European flavor of the Airbus, in December 1970 the Germans sold part of their share of Airbus work to the Dutch and Spanish governments which funded and guaranteed the membership for, respectively, Fokker and CASA. Thus, no member firm had a majority of votes, but each could veto any attempts to deviate from the development plans. These difficulties in changing the plans, coupled with the intergovernmental agreement to fund the aircraft through to flight certification, gave the Airbus tremendous momentum.
Hawker-Siddeley in 1970 again unsuccessfully pressed the British govern
ment to guarantee its membership in the consortium. Hawker had planned to design
discussion o f the GIE formula is Pierre Muller, Airbus—L1 Ambition Europeenne (Paris:
Harmattan, 1988).
and build the Airbus wings and, despite the British withdrawal, they remained inter
ested in the work. Airbus members agreed that Hawker was the firm best qualified to build the wings. Airbus production, like the production of all transports, would be paced by the delivery of the wings, the most complicated part of a large airframe.
They allowed Hawker to privately raise $70 million, mostly from German banks, which it would invest in tooling for the Airbus wings, for the privilege of building those wings. But Hawker remained a subcontractor, without the membership rights enjoyed by those firms that were completely at risk.
The third committee, the Airbus Executive Agency in Paris, kept the accounts on Airbus, monitored the funds paid in and received by each partner for their work, and monitored credits for export sales. Airbus Industrie functioned as a money mailbox. It did not hold cash, incur costs, declare a profit or loss, pay taxes, or adhere to accredited accounting standards. The member firms did all those normal corporate transactions under the laws of their host nations. The firms negotiated, for instance, how much it would cost Deutsche Airbus to design, tool and build the Center fuselage, and how much Deutsche Airbus would recoup from the sale of each complete Airbus. Deutsche Airbus made a profit by beating that price through fac
tory innovations. Liberal technology-sharing agreements prevented a member firm from hiding innovations and, in theory, members had no incentive to price gouge since they are both contractees and contractors.
Each member firm also paid an overhead of 2% to Airbus Industrie GIE, an international bureaucracy of about eighty engineers and managers, headquartered in Toulouse that reported to the Executive Agency. Sud Aviation ran the Airbus pro
gram from May 1969 until the Airbus Industrie GIE bureaucracy was ready to take over, in December 1970, and a Frenchman has always been managing director of Airbus Industrie. From 1970 to 1975 the managing director was Henri Ziegler, the first president of Aerospatiale and the French leader of the Concorde.10
Ziegler functioned like an ideal-typical program manager. He delegated authority to a small staff and inculcated in them the notion that they worked for a new, transnational organization, and represent nothing but the aircraft. They focused on the Airbus the work of a wide-flung network of engineering firms, pro
duction plants, and testing labs. In every previous collaborative program, as in the Airbus negotiations up to the French-German memorandum-of-understanding,
10 On Ziegler's role see Bogdan, Lew. L'Epopee du Ciel Clair (Paris: Hachette, 1988); Jean Pierre Quittard, Airbus, ou la volonte europeenne (Paris: France Empire, 1979).
committees had made the decisions and sales contacts, or more often, had deferred decision-making to committees closer to the ministerial level. (One Briton joked that DeGaulle chose the seat fabric for the Concorde.)11 By contrast, Ziegler's staff could make any decisions within the general outlines of the aircraft specification signed in May 1969. Once Ziegler and his staff inherited the Airbus specifications, they adopted a time-oriented, technically conservative outlook. Sud had begun fab
ricating the first prototype aircraft in September 1969, and kept to an inviolable, standard 36-month development schedule with the first flight in September 1972 (they were one month late) and FAA certification a standard fourteen months later.
Ziegler and his staff closely monitored the member firms for timeliness.
The role of Airbus Industrie in the integration of Europe was evident in the shopfloor protocols they adopted to routinize and expedite their work in an industry full of uncertainties, and in the congruence of corporate cultures that made these protocols possible. The program staff quickly froze the technical interfaces between the different subsystems and airframe subassemblies. Then they apportioned con
tracts geographically, in that Deutsche Airbus managed all the subcontracts with German firms and all the research in the territory of the center and rear fuselage.
Aerospatiale likewise governed the forward fuselage and cockpit, Hawker-Siddeley the wings, and CASA the tail. These subassemblies were then designed, produced, and tested concurrently, that is, in parallel rather than sequentially by building on more fundamental components. To show how all these concurrently-developed subassemblies would merge together exactly as planned in the program schedule, Airbus Industrie sketched a PERT chart. The PERT chart showed the temporal rela
tions and technical responsibilities of all the involved institutions. It also allowed Airbus Industrie to manage by exception, that is, they intervened only when some subcontractor did not finish its equipment on time, thus holding up the whole pro
gram.
To further hasten design, Airbus Industrie started with standard equipment, and hooked them together quickly, to give the Airbus a physical presence. When they couldn’t buy some design expertise from a European firm, they bought it in
11 Before American firms empowered program managers to solicit help from their depart
ments, committees o f the vice-presidents o f engineering, manufacturing, finance, etc., negotiated what each department would contribute to the building o f a new airframe, and the guy whose name was on the letterhead would arbitrate any disputes. In an era when airframe generations turned over every two years, departments could more easily swap promises within committees.
America. Forty percent of equipment and spares for the first Airbus, figured by price, came from American firms. Most of the equipment that spanned the entire aircraft came from France. In part, that reflected Aerospatiale’s management of all systems-wide equipment. In part, it reflected an earlier decision by the French gov
ernment to invest in developing the functional expertise of its general electronics firms. Ziegler had demanded that Airbus equipment contracts be placed with the best firms, regardless of national origin, so that Airbus would not become a vehicle for developing national equipment suppliers, a policy which had created problems with the Concorde.
All of the systems integration and testing, however, was managed by the Air
bus bureaucracy. In 1969 they issued a series of Interface Control Documents that told equipment contractors how to design connectors between equipment. Airbus Industrie had to audit changes in weight, heat transfer, or electromagnetic interfer
ence as equipment was added, improved or deleted. That is, one firm could not design an antenna to emit an electromagnetic signal that clashed with the signals emitted by another firm’s equipment. Nor could Aerospatiale relocate to the tail some hydraulic pump that unbalanced the aircraft center of gravity or reduced CASA’s weight envelop for the tail structure. Most of this systems auditing could only be done by swapping prototypes and testing them on the complete Airbus air
frame mockup at Toulouse.
The Airbus bureaucracy also rewrote standards and specifications for Europ
ean aircraft. They started with the American Federal Airworthiness Requirements, which aircraft had to satisfy in order to operate in the United States, and with mate
rial and processing standards issued by various American agencies, to prove to customers that the A300 would emerge as the state of the art. As the European firms learned more about the quality control and design for transport aircraft they rewrote the standards to codify the best, proven practices at the time. The resulting stan
dards and specification handbooks routinized much of the component design pro
cess, and thus gave an intellectual momentum to the Airbus program equal to that of the physical momentum of the early prototypes.
For Airbus Industrie, as with Boeing and McDonnell Douglas, its access to customers through sales and service was its most important central function vis the member firms. One year after FAA certification, in March 1974, Airbus Industrie had sold only twenty A300s, mostly to Air France. In July 1975 they made their first non-European sales, to Air India and South African Airways. But even after
delivering their first forty aircraft the Toulouse runway still held sixteen white-tails (so-called because they lack airline markings). Airbus Industrie had no authority to hire and fire workers during the natural cycles of aircraft delivery, nor could nationalized firms hire and fire as notoriously as Boeing or Douglas did. So they revised work schedules to keep member firms working as steadily as possible, and built for inventory.
Airbus Industrie became increasingly desperate to break into the huge Ameri
can market. In 1978, they saw a chance with Eastern Airlines, then bleeding red ink.
Eastern president Frank Borman liked the immediate availability of the A300, he liked its twin engine design which made it quieter and more fuel efficient than the longer-range American aircraft, and he liked Airbus Industrie's leasing offer which Borman expected would save Eastern Airlines $100 million over the purchase of American aircraft. By 1980, as international air transportation picked up, forty air
lines had bought 292 A300s outfitted with 157 different options. Tailoring gave the airlines a sense of control, and was inexpensive because the Airbus production process still required a lot o f handwork. Airbus Industrie monitored the additions of options, assuring that none of the options delayed the delivery of the aircraft or diminished its proven performance.
Consolidating the Matrix
By the mid-1970s, well before the Airbus A300 had proven its commercial success, the state ministries had to decide if and how Airbus Industrie would continue.
Ludwig Bölkow, in a 1972 speech, urged that the programming of the European aerospace industry lead to the creation of three aerospace companies, transnation- ally-chartered and publicly held, much like Royal Dutch Shell or Unilever.12 Or perhaps like Fokker-VFW GmbH, formed in 1969 from a transnational fusion of Amsterdam-based Fokker and Bremen-based VFW, and promising to capture a sub
stantial market share for its forty-seat feeder aircraft. Such transnational firms, Bölkow argued, could break the trend towards amassing skills in bigger national champions. By following an American model of vertically-integrated, aircraft firms
12Ludwig Bölkow, "A European Aerospace Industry: A German View," text o f speech delivered in Rome, 27 February 1972 (Ordner: "MBB Allgemeine Fusion, 1966-1977,"
Deutsches Museum Archiv).
capable of manufacturing complete aircraft, Europe was destroying all the advan
tages of internationalism—specialization of research labor, die pooling of research and manufacturing skills, and interdependence in sales and service. That is, Bölkow wanted the functional groups to be as transnational as the program consortia, and suggested starting this reorganization with engines, launch vehicles or tactical mis
siles. Such interdependence on skills, such a renunciation of national sovereignty over the technical control of future aircraft, Bölkow argued, was the essence of true integration. But European governments were not willing to forgo autarky in any industry so crucial to their national defense. And the transnational ideal tarnished when Fokker-VFW wrote off 1150 million Marks on its VFW 614 feeder aircraft, most of it money from the Bundes and Bremen governments, prior to VFW's shot
gun divorce from Fokker and fusion into the MBB combine.
Alternatively, the German government in 1974 suggested making Airbus Industrie a prime contractor, endowed with its own publicly-raised capital, that would service a single Airbus sales consortium. This arrangement was working well with the Tornado fighter aircraft. A single buying agency, organized under NATO auspices, gave one prime contract to PAN AVIA Tornado GmbH, a company jointly held by MBB, British Aerospace, and Aeritalia. The PANA VIA consortium had a transnational staff slightly larger than Airbus Industrie, and they distributed and managed subcontracts apportioned on a national basis according to how many fight
ers a nation ordered through the buying agency. The consortium collected the parts and shipped them to the respective national firms, which then did final assembly, testing and maintenance.
The French favored keeping the same GIE structure and developing a family of aircraft, as Boeing and McDonnell Douglas had begun doing, to satisfy the widest range of airline customers. Before they could extend Airbus Industrie GIE, how
ever, Germany and France had to solve the problem of Britain. When Martin Grüner became Coordinator for Aerospace in the German Economics Ministry, in 1974, he tried to bring Britain back into the Airbus consortium and thereby force France back to their original Europeanist intentions. Back in 1970, Germany had unilaterally surrendered portions of its work share to Fokker (6.6%) and CASA (3.2%) so that those firms could become Airbus members. Furthermore, Grüner knew that, by 1975, Britain was much more interested in collaboration. The BAC 3- 11 was destined to be a commercial failure, and the development of the Rolls-Royce RB.211 for the Lockheed TriStar had bankrupt the company. In 1974, the British
government called in its loans to Rolls and nationalized the company. The govern
ment also forced the merger of Hawker-Siddeley and BAC and, in 1977, national
ized the resulting British Aerospace Corporation. When forced to search for new partners to launch transport aircraft programs, however, BAe might have more con
veniently turned to American firms.
Both Boeing and McDonnell Douglas had taken a bemused attitude towards Airbus in the late 1960s. Douglas even licensed to Airbus production of their DC-10 engine nacelle that connected the General Electric engine to the wing, an arrange
ment that saved Airbus Industrie enormous time. But by 1974, both American firms had developed foreign policies, had become international in their subcontracting, and started offering partnerships that might pull apart the Airbus consortium.
Aeritalia had already opted out of Airbus Industrie in favor of an American strategy. An American strategy meant not selling aircraft to American airlines, but selling parts that American aircraft firms would use on the aircraft they sold domes
tically and abroad. The precursors of Aeritalia (the Italian government had created their national champion in 1969) had made fuselage panels for the DC-9 and the vertical stabilator for the DC-10. In 1970, Boeing offered Aeritalia a full partnership in the design of the QSHA (for Quiet, Short-Haul Airline), contingent on risk-shar
ing funds from the Italian government. However, Boeing abruptly and capriciously cancelled the program, and invited Aeritalia to instead take subcontracts for its Boeing 767. Aeritalia took the subcontract and stayed within the American subcon
tracting network, and as a result of the Boeing subcontracts Aeritalia became a leader in the fabrication of composite panels.
But to the other European firms Aeritalia’s demotion from partner to subcon
tractor symbolized the arrogance of the American firms. In June 1975 Boeing approached Aerospatiale about joint work, and McDonnell Douglas offered Dassault funding for its foundering Mercure 200 transport program. Prime Minister Jacques Chirac claimed France had tired of German and British procrastination on commit
ting to a family of Airbuses, and allowed Aerospatiale to sign a letter of intent to make an at-risk investment in tooling for the 757. One year later Aerospatiale broke off the agreement. Aerospatiale claimed Boeing wanted them to work as a subcon
tractor, with Boeing handling all the marketing, and with no guarantee that the col
laboration would become more permanent. Aerospatiale president Henri Ziegler called the DC-10 and 757 “American Trojan Horses,” and vowed renewed commit
ment to Airbus Industrie. Germany also wanted to commit to the continuation of
Airbus.1 3 While MBB prepared to take over Hawker's work on the Airbus wings, Ziegler set a deadline of May 1978 for Britain to commit to the Airbus family.
Britain was more receptive to an American strategy, since it had a longer tradition of trans-Atlantic cooperation. Boeing asked Rolls-Royce to design a stronger version of their now-successful RB.211 as the launch engine for the 757, and asked British Aerospace to accept a major subcontract to design and make the wing. British Airways, historically sweet on American jets, promised a big order for the new aircraft. The Ministry of Technology hoped that for the first time in a decade, British Aerospace, British Airways and Rolls-Royce could all be pointed in the same direction on developing the 757. But Boeing was consistent in its policy that, since it was the world leader in transports, it would be superior to all collabora
tors. For the 757, Boeing would design all the tooling and do the final assembly, flight testing, quality control and marketing in Seattle. Boeing offered BAe a fixed price contract, based on what Boeing estimated the wings would cost in-house, for designing the most sophisticated part of the aircraft. And Boeing made no guarantee on future collaboration. As one Boeing executive put it: “The Europeans do things differently from us. They talk about collaboration first, then they decide on a pro
ject. We do it the other way around.” 13 14
Because of Boeing’s policy of superiority, because Hawker-Siddeley had made £60 million manufacturing wings for the A300, and because British Aerospace thought they could demand more control over their European partners, British Aero
space opted for a European strategy and the Prime Minister, James Callaghan, ulti
mately approved their choice. British Aerospace, however, did not want to repay the French and Germans for the work they had already done on the A300. The British urged the launch of a new, smaller aircraft, the Joint European Transport, and asked for a new consortium arrangement. Furthermore, they wanted to move the final assembly out of Toulouse and to a BAe plant near Manchester. Even though final assembly and flight testing represented only six percent of total Airbus work, BAe argued that the move would weaken the French accent and make the entire European effort more balanced. The French argued that move would also destroy all momen
tum behind the Airbus organization. Customers came to Toulouse to see “Airbus production” and for all sales and support. British Aerospace reneged on these
13 "Ärger über französischen Alleingang," Süddeutsche Zeitung (14 August 1976).
14 Robert R. Ropelewski, "Boeing Unveils Three 7N7 Versions," Aviation Week and Space Technology (13 September 1976) 21.
demands in exchange for future promises of more work for Britian, In September 1978 BAe joined Airbus Industrie as a full partner by making its full assets liable to the program, and with f 100 million in loan capital for the A310 and £25 million for Airbus “work in progress,” meaning the A300. Airbus Industrie most wanted an A300 order from British Airways, to move aircraft off its inventory, but accepted one from Freddie Laker. Airbus Industrie convinced the member firms to make the same parts for the A310 they had developed for the A300, meaning BAe got the wings and the connecting portion of the center fuselage. In the mid-1980s, Airbus Industrie launched two more aircraft projects--the A320 and the A340—using roughly the same work and risk sharing arrangements. Thus, after the temptations of the American strategy in the mid-1970s, the Airbus consortium consolidated its matrix organization. The matrix had proven to be flexible, enduring, quickly expanded, and easy to edit.
Matrix organization had become the core organizational paradigm of the post
war aerospace industry. The “corporation,” as an organizational form, belonged to capital (most national laws say corporations must try to make a profit, not simply make products); and the “complex,” like the military-industrial one, belonged to the nation state (only the modem nation state could generate excess militarism and bestow excess profits). For all the people working to design a new machine, the corporation structure explained their financial relations; the complex explained their political relations; and the matrix explained their technical relations. The matrix had also become the managerial skeleton of the large technological system. New groups of people hoping to attach some new component to a technical system—an aircraft, for example-had to first attach themselves to its matrix, that is, to its system of technical management.
Expansion
In June 1992 the BDLI, the German Aircraft Industry Association, moved their bi
annual airshow back to Schönefeld airport in the reunited Berlin. In the main hall, Airbus Industrie had a small, virtually unmanned display, looking like a front office for some underground organization. Instead of the metal parts or black boxes that most companies displayed, Airbus Industrie displayed scale models of assembled aircraft, the Airbus A300 and A310, as well as the newest members to its family of
aircraft, the A320, A321, the long-range A340. The Airbus display stood, appropri
ately, between the much bigger display by Lufthansa, which buys the Airbus, and the display by Deutsche Aerospace, which builds huge parts of the Airbus. (In 1989 MBB was bought by the largest German firm, Daimler-Benz, which merged it with Domier and MTU, a German gas-turbine engine firm, to create Deutsche Aerospace AG.)
Nearby in Hall E, other European firms displayed metal forgings or black boxes, and advertised their historical contribution to the greater glory that is Airbus.
Given the social, political and technical momentum behind the Airbus and, formerly, the Tornado fighter, British Aerospace felt no shame in announcing in July 1992 that they would stop building complete aircraft of any kind and become just a subcon
tractor to transnational projects. In the European aircraft matrix, virtually every firm is a subcontractor. Three-quarters of MBB's annual turnover during the 1980s came from transnational projects, and most of the remaining quarter came from in-house research on equipment they hoped to hang on future transnational projects. For the Germans the success of the Airbus signaled the rise of their aircraft industry while for the British, given that Britain had the second strongest aircraft industry in the
1950s, their participation in Airbus Industrie signaled a relative decline.
General Dynamics was at the Berlin Air Show selling the internationalized version of its F-16, hoping to profit from the cancellation of the European Fighter Aircraft, the offshoot of the PAN AVIA Tornado GmbH. However, there were no other big American prime contractors—no McDonnells, no Northrops, no Boeings.
Yet Goodyear sold tires; Textron sold navigation equipment; Lockheed sold airport construction services; IBM sold logistics-oriented computers. These firms were firmly attached to the American military industrial complex. Still they wante4 to sell their way into the European aircraft matrix; to diversify their markets, to find partners in risky new projects, to attach themselves to the Airbus juggernaut. Since 1978, the non-European content of Airbus had dropped to eight percent, though American firms had been especially active in licensing their products to European partners to obscure their foreign origins. Air show organizers, surely aware of the visual politics of displays, housed these American subcontractors with the now- struggling Slovak and Polish firms that once sold their skills and parts to the Soviet Union’s military industrial complex.
