CAEN: The aerospace industry must embrace competition from technology companies such as Google and SpaceX which are already having a revolutionary impact on the sector, the head of the Airbus Group told AFP in an interview.

Describing the scale and speed of innovation in Silicon Valley as both “frightening and fascinating,” Tom Enders said the increasing digitalisation of the economy was having a profound impact on his company’s business.

“I think that in the future our industry will have to work much more closely with these new high-tech companies ... if only because these guys are increasingly intruding on our territory,” said Enders, 55, who is half-way through a four-year mandate as CEO of the European aerospace giant.

Enders cited SpaceX, the space transport company founded by former PayPal entrepreneur Elon Musk, whose Falcon launch vehicles are taking on the market-leading Airbus-built Ariane in the commercial satellite launch market.

SpaceX has also mounted a legal challenge to the monopoly held by Boeing and Lockheed Martin for the launch of US government satellites.

Google in April acquired the drone start-up Titan Aerospace which aims to compete with Airbus in making high-altitude unmanned planes that are meant to take on tasks traditionally done by more expensive satellites.

“Aerospace is still a rather young industry but these people are even younger,” he said. “And I think there is no debate as to which of us is the more vibrant industry. They are.”

Published in Dawn, June 10th, 2014