Machine technology for industry is consolidating

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0
Shipping Terms:
FOB
Date Posted:
2012-05-31
Expires:
2012-11-30
Status:
Expired

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Still, all manufacturing firms depend on their order book. Aerospace companies have found an alternative source of profit: servicing the goods they make. Rolls-Royce already gleans 51% of its revenue from servicing its engine fleet: its Trent jet engines are continuously assessed from a slick operations room at Derby. That figure is set to increase, the company says. For Bombardier’s global transport division, by contrast, the share of revenue from services went down between 2007 and 2010, from 21% to 14%.
Moreover, aerospace—including making the guts of aircraft engines, as Rolls-Royce does—is a global industry with standardised technologies. Only the paint job and interiors differ between planes made for different countries. Train production, by contrast, has until recently been largely national, which made it hard for manufacturers to achieve scale or make widely marketable goods. While Rolls-Royce hawks its wares around the world, Bombardier’s facilities (across Europe and North America, as well as in Derby) have depended on single contracts to build local rolling stock. Each type of train Bombardier produces at its various sites is a different size and specification; fewer than 10% of trains made at Derby are exported.
That insular model has now begun to change—but not to Bombardier’s advantage. Standardisation of technology is increasing and the industry is consolidating. Despite the popular stereotype that continental Europeans favour their own national suppliers, protectionism is loosening: in 2010, France’s state-owned Eurostar agreed to buy German-built Siemens trains; Spain’s Renfe also uses German express vehicles. That means the Bombardier factory in Derby can no longer rely on its status as Britain’s sole trainmaker. (Already in 2005 Hitachi won a deal for the British railway but shipped the fully assembled trains from Japan; the company will soon open a new facility in Britain but the carriage ca

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