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The Contender

How Airbus got to be number one.

Instead, Beteille gathered 10 engineers and handed them a specification for a twin-engine, wide-cabin jet, written in 1966 by Frank Kolk, chief engineer at American Airlines. Beteille told the team to follow the specification and use existing engines. They came back with a 250-seat airplane that had eight seats abreast rather than nine but could carry the same freight containers as the bigger American aircraft. “We kept the designation A300—it was one way of not drawing attention to what we were doing,” says Beteille. At the end of 1968 the Airbus team announced that they had downsized the new airplane and eliminated the RB.207. The British government walked out, but the British firm Hawker Siddeley remained as a subcontractor, and the German and French governments agreed to split the costs. Meanwhile, Beteille had met Felix Kracht, who was to become another father of the Airbus organization. Kracht, a sailplane pioneer, had experience in international programs from the Franco-German Transall C160 military transport.

By the end of the 1960s, the center of gravity for the Airbus program was located in France, at least in part because the French had assigned important talent and more people to the project. Under president Henri Ziegler were Beteille as technical director and Kracht as production director, and it was the latter two who defined the program as it exists today.

Kracht, who died last year,was instrumental in establishing the technique of assembling large components, fabricated in different countries, at a single location. One of the most expensive mistakes on Concorde had been the use of two final-assembly lines in Britain and France doing exactly the same thing—with an enormous duplication in tooling and overhead.

“No way,” recalls Beteille. “One line was a prerequisite.” That line would be in Toulouse—and not for French gloire, Beteille maintains. “It’s the only place in Europe with enough airspace to do flight tests,” he says. But he adds that if they’d done everything on an assembly line, hundreds of workers would have had to be transplanted from Hamburg and Manchester to Toulouse. Kracht and Beteille thought the workers would be more productive at home.

The solution was called “light assembly”: The body and wing sections would be completed in Germany and Britain, with wiring, fluid lines, air ducts, and insulation in place, so fewer people would be needed in Toulouse for final assembly. And that is how every Airbus is built today. Management was organized according to the same principle: Look at Concorde and do the opposite.

The Airbus partners agreed to delegate all day-to-day decisions to a small headquarters in Toulouse. It would do basic design, assembly, flight test, sales and marketing, and support for the new airplane. It would report to a supervisory board, but would make all decisions autonomously.

In July 1973, Adam Brown, now Airbus’ head of strategic planning, joined the firm directly from Hawker Siddeley’s Hatfield factory, where he had helped sell Tridents. “It wasn’t a very difficult decision, although a lot of people thought we were crazy,” Brown recalls. “But what was there to lose?”

“We Germans thought we were coming to a French company, but it was the French who were totally lost,” says Jurgen Thomas, now special advisor to Airbus’ CEO, Noël Forgeard. “The French were hierarchical, with no delegation of power. They weren’t in a position to take a decision in a meeting.” The British and Germans resorted to subterfuge, Thomas recalls. “We let things leak ahead of the meeting, so that the French could propose it as their solution. It was much easier.”

Thomas admits that some stereotypes of German management proved true: “There was still a Prussian disease. It was formal, the agenda had a time slot for each item, and there were separate paragraphs for everything.” The British encountered a different culture at the Airbus facility. At de Havilland’s Hatfield division there were six levels of company dining. “They had toilets for different levels of staff,” recalls Thomas. Airbus people took lunch in an all-ranks café. “You’d see a vice president having lunch with a secretary,” says Thomas. One senior executive from Hawker Siddeley stomped out in disgust.

“Only the French would have done it” is how Adam Brown recalls the first A300 sales tour, a six-week odyssey around the Americas from Rio to Chicago in 1973. French fashion designer Andre Courreges designed the women’s cabin crew uniforms. Ted Lapidus dressed the men. Four and a half tons of Moet & Chandon champagne occupied the cargo hold. They got away with such frills because nobody cared. “The Airbus people were looked down on by people on Concorde,” Thomas says. Even the Mercure got more attention in Paris, thanks to Dassault’s political pull.

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