OVER the past century the aerospace industry in the North West has grown to become a core sector and wealth generator for the region, grossing an estimated £7 billion a year in sales.

While traditional industries such as textiles, mining and the automotive components sector have steadily declined, the aerospace sector has become the backbone of the regional economy.

It provides well-paid jobs for some 60,000 direct employees, with many more dependent indirectly and is the region's key exporter.

In the UK, the North West is the epicentre of aerospace production, has one of the largest aerospace clusters in Europe and is still at the cutting edge of globally important technological advances.

Despite all this, the industry is vulnerable to the cyclical nature of the aerospace market and is currently experiencing a turbulent period due to a number of influences, not least of which are the "production gap" between the end of major aircraft programmes and the start of their successors, the repercussions of terrorist attacks and last year's SARS virus scare.

It's now ten years since the North West Aerospace Alliance was established to bring together manufacturers, mainly small to medium-sized enterprises (SMEs) hit by a downturn in orders, to look at ways to secure the future, preserve jobs and win new business.

Initial suspicion among companies that were used to keeping themselves very much to themselves eventually gave way to a realisation that in order to survive, companies needed to co-operate and at the same time maintain their competitive edge, to collaborate instead of going their separate ways.

The ensuing decade has seen many changes within the industry, centred on globalisation, rationalisation and still more competition for business.

While the region is still home to "giants" of the industry like Rolls-Royce at Barnoldswick and BAE Systems at Warton and Samlesbury, the grass roots of the industry - smaller specialist engineering companies - collectively support thousands of jobs.

Their task is rapidly changing. Where once they would "build to print" - make aerospace components to the prime manufacturers' drawings - they are now having to take their share of risk and invest to win larger packages of work, delivering complete sub assemblies direct-to-line, much like automotive manufacture.

Despite these changing roles and some significant rationalisation, the aerospace industry in the North West remains strong, if leaner. The NWAA has seen its membership soar from a handful of inaugural member companies centred on East Lancashire to a major regional alliance of more than 800 manufacturers and suppliers.

With the assistance of the Northwest Development Agency, national and European funding, the NWAA now provides a comprehensive range of services, ranging from competitive packages for members exhibiting at air shows to training and education initiatives and trade missions.

It has also acted as a catalyst to bring together mini consortia of member companies with complementary skills and technologies, enabling them to bid for higher value packages of work on key programmes.

This year the Alliance hopes to take things much further. Explains its chairman, Dennis Mendoros: "We are awaiting a crucial decision on plans to establish the North West Aerospace Innovation Centre (AIC) of international importance in the region and we also plan to broaden our base as a cluster organisation, by providing additional services to our member companies and interact more effectively with other clusters and organisations."

The AIC initiative is a multi-million-pound project, which already has the backing of the Northwest Development Agency, the industry, universities and other stake-holders.

The proposal is backed by all eight North West universities and is seen as a centre where industry -- both Primes and SMEs -- and academia can pool knowledge and exploit new technologies in a joined-up way that will ensure that the region maintains its lead in key aerospace technologies through collaboration and innovation.

Since the turn of the millennium it has been the NWAA's view that mid 2004 to early 2005 would be a watershed period for the aerospace industry as once again the production "upwave" gathers pace with the arrival of new programmes.

SMEs in the North West have to face the fact that large manufacturers now buy and sell in the global market. Modern communications mean it's nearly as easy and much more cost effective to put out work packages to companies in the Indian subcontinent, the Far East and Australasia.

Dennis said: "That means we need to be sharper, keener, more efficient and more competitive. At the NWAA we firmly believe that the beginning of the second century of aviation offers both difficult challenges and some very real opportunities."

At the NWAA's recent 100 Years of Flight Conference, Lord Bach, Minister for Defence Procurement, confirmed that the UK's share in the JSF could net the UK £5 billion in the planning stages and a colossal £25 billion during production.

That's just one aircraft programme but added to other programmes including Eurofighter, the new double-deck Airbus A380 airliner and the major A400M heavy transport aircraft, the potential for sustaining the region's aerospace sector is there.

Dennis added: "If our SMEs can join together and win work packages on new aircraft programmes, be cost effective at what they do and take a technological lead over overseas competitors, the rewards are potentially vast."s