Europe's Detroit? Pandemic bursts Toulouse aerospace bubble

Barely three months ago, Serge Dumas had one problem: how to keep up with record demand for the metal fasteners and bolts his small aerospace supply firm manufactures just north of Toulouse. Now, the head of Gillis Aerospace is wondering how to keep his 45 employees busy as Europe’s aerospace capital reels from plummeting jetliner demand caused by the coronavirus crisis. “In February, we were in the midst of euphoria and operating a just-in-time schedule,” Dumas said, referring to the drum beat of a fully-stretched aerospace supply chain. "In a few days, we went from accelerating flat-out to slamming on the brakes. We were flabbergasted.” Now his company, which recently partnered with Germany’s Boellhoff Group, has suspended an E800,000 investment in a new building and machinery. Gillis Aerospace, with annual revenues of E5m, is one of thousands of small to medium-sized firms hurt by the crisis as the French government and private lenders finalise a E1b fund to help the sector. Across the surrounding Occitanie region, a total of 40,000 aerospace jobs are seen at risk, up to half of which could involve Airbus, based in regional capital Toulouse. Once basking in wealth from air transport, France’s fourth largest city is alarmed by whispers that it could suffer a fate similar to Detroit, ravaged by recession in the auto industry. Four think-tanks and associations sounded the alarm in May, warning the area could succumb to “Detroit Syndrome”. “Right now, aerospace sub-contracting represents 86,000 jobs in Occitanie and Airbus buys 5-billion-euros of parts locally,” said Alain Di Crescenzo, president of Occitanie’s Industrial Chamber of Commerce. Planemakers employ another 30,000. “When Airbus coughs, everyone gets sick.” <br/>