August 1974. Compared to the Cortinas and Maxis in the carpark, the prototype Concorde taxiing onto the runway at RAF Fairford looked astonishingly modern: but then, it always would. For the next quarter of a century, it would always be an object that stood out from its context, stylistically disconnected from the machines people build for more everyday tasks. Even now, when the carparks at Heathrow and Charles de Gaulle are filled with sleek creations, art-directed to the max by Mercedes and Renault to convey futurity, Concorde still looks as if a crack has opened in the fabric of the Universe and a message from tomorrow has been poked through. Age has, however, made it clear that the tomorrow in question is yesterday’s tomorrow; and age has shown too, of course, in the gradual revelation of the design’s practical flaws, such as the unsolved question of how to protect the wings from the wheels, which in July 2000 brought down Air France Flight AF4590 in a scrawl of flame.
Brian Trubshaw, the chief test pilot for Concorde at the British Aircraft Corporation, was at the controls that day in 1974, dressed in his orange flight suit. He swung the plane round and pointed it west up the tarmac. Concorde cornered smartly on its spindly undercarriage. It was quicker on the ground than other airliners, just as it took off and landed faster than them. In all its movements, Trubshaw and his colleagues and their French counterparts had learned to expect an element of hurtle, exhilarating to master. Events came at a Concorde pilot at a more adrenalised tempo. Trubshaw liked this: it was stretching. In the 1990s, having retired to a Cotswold village, he sometimes nipped next door to have a go on a neighbour’s flight simulator software, which had a Concorde module. It wasn’t the same, of course, ‘but it gives you a taste,’ he said.
Clearance from the tower came in over the co-pilot’s headset. On the centre panel in the cockpit, all four of the indicator lights that summarised the dataflow from the Olympus engines glowed green. With the wheel-brakes locked, Trubshaw gently throttled up the turbines, and engaged ‘re-heat’, the afterburning system which generated extra thrust by spraying fuel into the main engines’ exhaust. Then he let go the brakes and the plane gave him its almost shocking acceleration. There were well over a hundred people in the flight-test team – pilots, ground crew, technicians, engineers, administrators – but more often than not he was the fortunate one who got to ride up the runway in the right-hand seat of the conical cockpit, with the bigness of the plane just a sensed presence behind him, and the nose dropped so that there was nothing ahead but the blurring ribbon of concrete. He felt the sharp edges of the delta wing slicing the air into two flows, and the flow beneath the wing beginning to build in pressure, and building, and building, till there was enough lift for him to pull back the stick, and send the Concorde 002 skyward with a grinding roar; a man at the controls of the only airliner in the world that handled like a fighter plane.
Behind him there was jubilation. This was not a significant test flight – those were long concluded. Trubshaw was just going to fly one more standard supersonic circuit of the Bay of Biscay, where BAC and Aerospatiale had been allotted a piece of sky in which they could boom to their heart’s content. But today wasn’t an ordinary occasion either. Two days before, while Trubshaw was working out the logistics of a flight to Bahrain, to ‘prove the route’ for British Airways, his phone rang. It was Tony Benn, Secretary of State for Industry. Mr Trubshaw, Benn said, I understand you’re off to Bahrain next week; is there a chance you could organise a flight for me and some of the chaps before you go? Certainly Minister, Trubshaw replied. No problem at all. But which chaps are these? Oh, Benn said, the aerospace shop stewards from the plants at Filton and Weybridge. I thought I’d bring about fifty, if you have the seats.
Trubshaw would have said yes to any political request for a joyride. Concorde existed on sufferance. It needed constant backers to help it survive its constant crises. The latest one had almost killed the project. The multiplying cost of aviation fuel, in that year of the oil shock, had been the last straw for the airlines holding an option to buy Concorde; they had all dropped out. Benn had been instrumental in making sure that when Labour came back into office in spring 1974, the Government had nonetheless authorised a small production run of planes for the British and French national carriers. He had another claim to consideration, too. He was the MP for the Bristol constituency that contained the Filton plant, and he had been a steady friend to Concorde ever since it was first mooted. So he was owed a favour. But, as it happened, Trubshaw liked this Secretary of State. ‘He had an outstanding brain,’ the test pilot remembered 26 years later, when I interviewed him a few months before his death in the spring of 2001. ‘Of all the ministers, the great thing about this chap is he understood what he was talking about.’ Benn returned the feeling. Having learned to fly himself in the RAF towards the end of the war, he had glimpsed the great pyramid of repute which mounted from humble students like himself towards the shadowy apex where the mighty test pilots belonged, men like Trubshaw and his military counterparts Roly Beamont and Eric Brown, men who were stuffed with as much unostentatious grandeur as Chuck Yeager in the US. Benn had come along on many of Concorde’s earlier proving flights, including one in 1970 when a hydraulic system failed and the plane went into ‘an uncontrollable gentle roll’. He always brought a camera so he could take his own pictures of the plane. On one occasion, he asked for Trubshaw’s autograph.
Benn was a technocrat, the nearest thing there has ever been in British politics to the bright young men the Grands Ecoles turn out to administer the French state corporations. As Wilson’s Minister of Technology between 1966 and 1970, he had stood for a Britain that could be at home in the modern world. Whenever, during his time in office, British Rail announced the development of a new high-speed train, or the Atomic Energy Authority opened a new reactor, another steel and glass panel was added to the Britain he wanted to see built. The monument that symbolised his outlook was the Post Office Tower. He always got on well with engineers. In fact, to begin with, he thought of socialism as a way of engineering society, so that it was better, and more rational, and more efficient.
But times had changed since the Wilson Government made its grand attempt to put this vision into practice, with an integrated, co-ordinated blueprint for the entire British economy. The result, the National Plan of 1965, had lasted one year. Back in power now after four years of Heath, the Labour Cabinet was frantically reacting to events. The stock market was crashing, inflation was 20 per cent, the oil price had quadrupled, there were strikes everywhere. Like his colleagues, Benn spent his days rushing from emergency to emergency, arranging a cash injection here, calming an outbreak of militancy there. But unlike his colleagues, Benn had started to see a silver lining to the crisis, a promise glimmering amid the confusion: he thought he was witnessing a social revolution.
And this was probably why he was sitting in the cabin of Concorde on 3 August 1974 with his wife, two aides, a reporter from BBC Radio Bristol and fifty shop stewards from the AUEW and TASS. It was the stewards’ first ride in the plane they had helped to build. Despite spending most of the last 15 years welding Concorde’s airframe, and applying its aluminium skin, and turning the parts for its control linkages, none of them had ever left the ground aboard it; indeed, some of them had never flown at all before, or not since their war service. One had gone to confession, just in case. By arranging this jaunt, Benn was performing an act of restitution. He was dispensing social justice like a fairy godmother: yes, Mr Shop Steward, you shall go to the stratosphere. And, probably, he was doing so because he believed that the stewards represented the future. In its 1974 Manifesto, Labour had promised ‘an irreversible shift of power in favour of working people and their families’. To Benn, that meant power being transferred to grassroots union officials like these. When he looked around the chaotic industrial landscape of Britain, he saw a new, direct form of democracy based on union muscle. Yet other ministers refused to see it. Instead, they let their civil servants lecture them on the need for industries to make profits – ‘the Tory philosophy in a nutshell,’ he would expostulate a couple of months later. He felt closer to the shop stewards. Today’s event – he would write in his diary that evening, with a happy sense of inclusion – felt ‘like a coach outing to Margate or Weston-super-Mare’.
As Concorde 002 crossed the Cornish coast, Trubshaw relit the afterburners, and started to climb again, from the ordinary airline cruising height of 30,000 feet to Concorde’s altitude for supersonic cruising at 60,000 feet. As he accelerated past Mach 1, the bow wave of air the plane threw to each side of it became too energetic to slide into the atmosphere, and slammed against it instead, colliding with the air molecules in its path at a pressure of about 2lb per square foot. The assaulted air shook, and gave up the dose of extra energy as sound. Concorde climbed on, dragging its sack of reverberating noise behind. There is, of course, no such thing as the sound barrier. What there is, is the aerodynamic challenge of the turbulent passage through Mach 1; and then the different challenge as the speed continues to rise and the airflow over the aeroplane’s wings changes in character again, smoothing out, yet condensing into new standing waves, new vortices, new invisible knots and whorls of intense pressure. Both of these are easier in the thin air at 60,000 feet. Even so, up there where the sky darkens to a deep purple and a few stars show at the zenith, the rarefied molecules of the stratosphere still hit the fuselage hard enough to make it blisteringly hot. The skin of an ordinary airliner chills to –35 °C, causing the cold you feel when you touch the inner pane of the double windows. As Trubshaw levelled out at last, a sixth of the way into space as Nasa defines it, with the machmeter reading 2.2, Concorde 002’s skin temperature had risen to 90 °C from the friction, with hotter spots still on the wing edges and the nose tip. Tiny pumps moved thousands of gallons of fuel from tank to tank to trim the plane. In the engine intakes under the wings, a sequence of curved baffles, on which tens of thousands of hours of calculation had been expended, slowed the onrushing air so it wouldn’t stall Rolls-Royce’s turbines. Air-conditioning fans sucked heat from the cabin into the fuel tanks. The plane flew at more than twice the speed of its own boom: from Trubshaw and his passengers’ point of view, Concorde 002 soared in exquisite silence. Far below, the Atlantic was a sheet of wrinkled silver.
Concorde was a marvel, a genuine exercise in the technological sublime. It was the European equivalent of the Apollo Programme, a gasp-inducing, consciously grand undertaking that changed the sense, in those who contemplated it, of what human beings were capable of. When Britain and France agreed to build Concorde in 1962, no one knew how to design a supersonic passenger plane. There were proven military jets that flew at Mach 2, but those were one-seat aerial hotrods in which a fit young man could hurl himself around the sky for a couple of hours, followed by days if not weeks of maintenance work on his aircraft. A smooth ride, a commercial level of fuel economy, an aircraft reliable day after day: these were all mysteries to be solved, which helps to explain how the cost of the project kept multiplying, aided by some poor management and by some foolish late changes in the spec, until the price-tag, too, was worthy of a gasp. By some reckonings, Concorde ended up being designed not once, or even twice, but two and a half times, because of a decision to make the production model twenty feet longer than the prototype, and the constant jostling of redesigned components against neighbouring components which then also had to be redesigned. At the witness seminar on Concorde held at the Institute of Contemporary British History in 2000, one civil servant remembered the example of the plane’s ever-expanding wheels.
They discovered that the weight had gone up to the point where the wheel had to be larger to meet the runway requirements, but the wheel was a tight fit in the wing. So a bulge had to be produced in the wing. The result of that was that the air resistance was greater than it had been, more fuel was required, and to carry that fuel a heavier structure was required. Because a heavier structure was required, an even bigger wheel was needed.*
And at every revision, the designers were aiming at an extraordinarily narrow window of technical viability. As eventually completed, Concorde has a pay-load capacity of only 7 per cent of its take-off mass, a ratio more reminiscent of a satellite launcher than a normal airliner. It can cross the Atlantic, but only just. London-New York and Paris-New York are possible; Frankfurt-New York is not.
Yet, perverse though it may seem to say so, Concorde works at all because, in one limited sense, the designers were modest. They successfully confined themselves to solving only the next problem, filling in the immediately adjacent bits of the unknown. Take Concorde’s chosen cruising speed of Mach 2.2: it was just about at the safe limit of what a conventional aluminium structure could stand, in the way of atmospheric heating, so long as there were a few pieces of more resilient steel and titanium covering the sensitive nose and wing edges. If they had tried to a build a plane that flew at Mach 3, they would have been looking at a skin temperature at cruise altitude of 250 °C, enough to melt aluminium, and the whole plane would have had to be made out of unproven, exotic materials. Here was where the Americans went wrong with their government-funded Supersonic Transport: Boeing spent the 1960s trying to construct a super-duper Mach 3 SST, and ended up with nothing at all. The Russians, meanwhile, made the contrasting mistake with their Tupolev Tu-144, a.k.a. ‘Concordski’, and attempted a quick and dirty solution which didn’t refine military technology enough. The Tupolev’s engines were twice as heavy and burned fuel twice as fast as Concorde’s. It had the range to get only halfway across the Atlantic.
The real flaw in Concorde was not technological but social. The whole project was based on an error in social prediction. Those who commissioned it assumed that air travel would remain, as it was in 1962, something done by the rich: and not the mobile, hard-working managerial rich either, but the gilded upper-crust celebrity rich, the jet set as they were when the phrase ‘jet set’ was first coined. Concorde was built to move Princess Margaret, Noël Coward, Grace Kelly and Ian Fleming around the world. It was built to carry them to Barbados for the winter, and to New York to go shopping; to Buenos Aires to watch the polo, and to South Africa to go on safari. Since this pattern of use for air travel was assumed to be a given, the natural next step, technologically speaking, was to make the planes faster. But at the same time that Britain and France were betting on supersonic speed as the next step in aviation, one of the bosses at Boeing pushed through the development of a subsonic plane that could carry four hundred passengers at a time. The Boeing 747 was just as bold a leap into the unknown as Concorde, just as extreme in its departure from the norm; nothing so large had ever left the ground before. And Boeing’s gamble paid off. The 747 was the right plane for the future that actually arrived. It allowed airlines to serve the mass market for air travel that emerged in the 1970s. Concorde could not be adapted to suit the more varied needs of a world in which it had become normal for millions of people to fly. With its cramped tube of a cabin, and its tiny pay-load of passengers in relation to its operating cost, Concorde could never be turned into a workhorse of the skies. Even if the initial estimate of the price at which it would be offered to airlines had not been out by a factor of ten, it would still have been a strictly marginal proposition to operate. So by the time Trubshaw took Tony Benn and his coach party out for a spin, it was becoming painfully clear that Concorde had been a brilliant exercise in providing an unneeded product. Concorde was redundant to exactly the degree that it was superlative. It was a Batmobile when the market demanded a bus.
And as it happened, the trade unionists did not represent the future either. The era of their power was almost over. Two different lost causes were compounded, that day in 1974 – British socialism’s hope for the New Jerusalem, and the British aircraft industry’s hope that one sublime technological roll of the dice would readmit it to the big league of civil aviation players, along with the likes of Boeing and Lockheed. Over the Bay of Biscay, Concorde soared on, gorgeously excessive, gorgeously divorced from utility. It was now doing what Superman did in the comic books; at 1350 mph, it was moving faster than a speeding bullet. One of the shop stewards took an old thruppenny bit out of his pocket and balanced it on its edge on the table in front of him. It quivered, but it didn’t fall down.
December 1981. Early dusk over the Thames; rain in the wind. The lights were going on in the Palace of Westminster. Nine men in a committee room waited to help lay Concorde to rest. The MPs of the Commons Select Committee on Trade and Industry talked the language of grave, open-minded deliberation, but all of them, the Conservative majority and the Labour minority alike, expected that their inquiry into Concorde’s finances would end with the project being halted at last. The 16 planes authorised in 1974 had been tried out on route after route, and they had never made a profit for British Airways or Air France on any of them. Indeed, the demand for Concorde tickets seemed to be going down as the recession of the early 1980s bit. So far as the MPs were concerned, the plane had had every chance to prove itself, and had failed. The Committee could no longer be swayed by concern for Britain’s technological honour; they saw their primary duty as defending the public purse. For every year that Concorde went on operating, the Government had to pay out another £30 million of taxpayers’ money in subsidy. Total expenditure had reached £849 million by the end of 1980, and was still rising.
Concorde was anyway an anomaly now. The 16 planes had become technological orphans. They had only just managed to come into existence by monopolising all the available investment and all the official attention, in the process killing off a whole range of other initiatives that might have been more fruitful and self-sustaining. And now they were messengers from a lost world: the world in which British high-tech industry had existed since the Second World War, one sustained by the decisions of grandee industrialists and Whitehall mandarins with an ideal of the public good. For all that time, there had been an assumption that each new generation of technology would be integrated into a great British stability, and infused by a changing but always recognisable British identity. When Michael Powell in A Canterbury Tale had shown a hawk rising from a pilgrim’s hand and turning into a Spitfire, it had seemed natural. When English Electric developed the RAF’s new jet interceptor, the Lightning – tested by Roly Beamont – it had seemed to fit easily into the ‘New Elizabethan’ spirit the newspapers were fond of perceiving in the 1950s. It had seemed natural that in the picture-postcard skies above green fields, young Mr de Havilland would be testing some smooth silver prototype, that the needle-nosed Fairey Delta would be setting an air-speed record. This world was gone by 1981, hit by shocks and strikes and stagnation. A Government had come to power that thought the whole system was bankrupt, in practice and, more significantly, in principle. Thatcherite Tories resolved to have no industrial policy – to let the cold wind of the market blow away the whole cobwebby structure. The pound was allowed to float free on the foreign exchanges, while Geoffrey Howe’s budgets squeezed inflation out of the economy by raising interest rates sky-high. The combination was lethal. Suddenly, as speculative money rushed into the country, the pound soared to $2.40. Firms faced phenomenally high costs at home, to produce goods which were then hopelessly uncompetitive on the world market. Firm after firm folded. It was the end of metal-bashing; it was the end of Britain’s history as a traditional industrial power. Whatever happened next technologically, it would have to be something quite different: the old game was over.
Concorde survived because it was the subject of a very unusual international treaty. Britain couldn’t get out of the Concorde Treaty without French approval; France couldn’t void it without Britain’s say-so. Back in 1962 the idea seems to have been to create a technological bond between Britain and France, even if de Gaulle would not agree to let Britain into the Common Market. It was a ploy that their successors cursed. Over the next twenty years, whenever British government ministers thought about escaping from Concorde’s insatiable need for money, they always got the same advice from their law officers: it would cost more to pay the damages the French would win at the Hague for breaking the Treaty than to go on with the aeroplane. It always seemed to be that way round: the British wanting out, the French wanting to keep going, in line with their wider policy of using Concorde to lead the development of their aerospace industry. While RAF Fairford remained a shabby military base, minimally adapted for flight development work, its counterpart facility at Toulouse became the nucleus of a giant new industrial complex. (It’s now the nerve centre of Airbus.)
The Select Committee had convened, and Concorde’s finances were back on the agenda, because at the Anglo-French summit in the spring of 1981 the French representatives had hinted, for the first time ever, that they might be willing to say goodbye to the shared albatross. At earlier sessions, the Committee members had been presented with a table estimating that the net cost of keeping Concorde in service until 1985 would be a predictably grim £56.7 million: their first report, published in March 1981, expressed concern that the figure might be even higher, and urged the Government to take advantage of the new French flexibility. In response, in July 1981, Norman Lamont, a minister at the Department of Industry, officially announced that a survey was underway of the relative costs of three different options: (1) immediate cancellation; (2) gradual rundown over a two to three-year period; (3) indefinite continuation. At a follow-up meeting with President Mitterrand’s officials in October, the French formally objected to option (1), so the survey concentrated on comparing (2) and (3). ‘Indefinite continuation’ in civil service language is a phrase which already has the cool kiss of death planted on its brow. It implies deeply undesirable things, such as ‘unlimited demand on public resources’. When the MPs met again in December they expected to roast Lamont for the sin of considering (3) at all. It was settled in their minds that Concorde’s fate was to be option (2); that, after a decent period of study and quiet Anglo-French diplomacy, the long nightmare would be over at last. No unexpected outside party was going to ride to the financial rescue now. The last person who might actually have bought a couple of Concordes at the asking price, the Shah of Iran, had died in exile the year before. Federal Express had opened negotiations to lease two of BA’s Concorde fleet for use as blue-riband, top-of-the range, supersonic parcel-carriers; but it became clear to Lamont and Co that Fed Ex wanted the Government to pay Concorde’s support costs for as long as the company chose to keep up the arrangement.
But when Lamont and his boss, Patrick Jenkin, Secretary of State for Industry, together with a pair of supporting civil servants, arrived in the committee room on 9 December, things did not go as expected. A week before, the Committee had been sent a revised set of cost estimates, and as its members questioned Lamont, and found that he stood by the strange deviance in these figures from the earlier ones, it emerged that the Committee was facing an almost unprecedented development in Concorde’s history: a piece of good news. The March 1981 table from the Department of Industry had set the £56.7m cost of keeping the plane against a projected cost for cancelling it (and paying redundancy money, compensation and so on) of £47.5m. Cancelling was expensive, but it had a clear margin in its favour. In the revised figures, on the other hand, the five-year projected outlay for keeping Concorde going had suddenly shrunk to a mere £5.9m. Though the cancellation estimate had fallen, too, it dropped only to £34.2m. Suddenly, the Committee was being told that the economical option was to keep the plane in the air.
The MPs didn’t believe a word of it. For two whole decades, mirages of Concorde’s commercial success had been conjured periodically in the House of Commons by ministers making the case for just a bit more public money. Now, when there was any mention of success, MPs reacted with the hard-won wariness of punters who had been induced to invest in a perpetual-motion machine, a device for extracting gold from seawater or several acres of beachfront property in Kansas. They hammered at the witnesses on the two points where it was claimed improvement would take place: a sharp rise in BA’s income from Concorde, and a sharp fall in expenditure on technical support for the plane. The Committee’s printed report, published a few months later, said that promises of reduced expenditure were not to be relied on. This was more nonsense, another mirage, another burst of optimism that would surely evaporate when it turned out to be based on nothing more than hopeful jiggery-pokery with the accounts.
But this time something really had changed.
There had never been much enthusiasm for Concorde at the top of BA, whose management had been lumbered with buying seven Concordes – a duty imposed on them as bosses of a nationalised industry. Essentially, they saw the plane as an overspecified toy, an expensive gewgaw with too much vroom to it. Only the line managers in direct contact with BA’s Concorde operations were at all keen. They were the ones who had pushed through the dispiriting experiments with ‘city pairs’ in the hope of finding some combination that generated enough demand for Concorde. London-Bahrain? No. Melbourne-Singapore? No. A two-hop service from London to Washington to Dallas, in association with the Texan airline Braniff? Maybe, but Braniff went bust. Even on the core route from London to New York, income from ticket sales never came close to covering operating costs.
Then in February 1981 Sir John King was made chairman of BA, and suddenly – in the words of Bruce MacTavish, one of the civil servants who appeared with Lamont before the Select Committee – ‘it was “love that bird!” time.’ It was not that King was a visionary. He was not the sort of businessman who would ever have let his enthusiasm for a product distract him from the bottom line. Though he came from manufacturing, and from aerospace manufacturing at that, he had deliberately chosen to work in areas where profits were not disturbed by unproven technology. His first company, Pollard Ball and Roller Bearing, supplied Rolls-Royce with ball-bearings. ‘One of the most basic things you can make,’ he said with satisfaction. When he praised the simplicity of a widget, it meant something quite different from the flush of cognitive pleasure engineers got out of simple solutions. He meant ‘simple’ as in ‘dependable’, with a dependable margin on each one sold. His recipe for business success was simple, too: cut out the wishy-washy stuff, the blue-sky research; nurture the cash cows, kill the rest. At his next company, the engineering conglomerate Babcock International, he fired 16,000 of the 40,000 employees. In his bristling assertiveness and self-confidence, he resembled a human truncheon. He was Mrs Thatcher’s favourite businessman.
This was not a man who would ever have endorsed in a million years the building of a big-ticket dream machine like Concorde. But he understood the value of a brand. He understood the subtle psychology of building up your product in the consumer’s imagination. Concorde was a burden, but it could be made into an advantage. Its catastrophically small share of the world aviation market gave it scarcity value. The mark of its failure could become the badge of its exclusivity. Concorde’s glamour, he saw, could be used to differentiate BA in the crowded market for transatlantic flights. It could be made into a unique selling point for the whole airline – BA-commissioned market research showed that passengers on BA’s bog-standard services experienced a reflected lustre from the very existence of Concorde in BA’s fleet. It made their own choice of carrier seem that little bit more sophisticated and exciting. The marketing department called this the ‘halo effect’. What’s more, seeing Concorde as merely an unfeasibly expensive way of getting about missed the point. A special super-luxury niche exists for a handful of products whose prices are effectively disconnected from their utility: instead, the price works as a guarantee of their desirability. Ferraris belong in this category; so do Rolexes, couture clothes and, on a humbler level, bottles of champagne. Participating in this market is not easy; but if a Ferrari-like appeal could be established for the sensation of spending nearly three and a half hours in a seat on Concorde, then BA could hope to obtain the pay-off for having the airline equivalent of champagne to sell – i.e. a truly fabulous return.
The question, then, was whether BA could find a basis for operating Concorde that would let it fulfil the two functions King had identified for it: promoting the airline as a whole, and supporting itself in the Veuve Clicquot market sector. Fortunately, the first piece of the puzzle had already been laid into place, though not much notice had been taken at the time. In 1979, the Government had agreed to wipe out the purchase price of BA’s seven planes with a payment of £165m from the Public Dividend Capital account, a special form of expenditure reserved for occasions when there was a real prospect of a return, a ‘public dividend’. Instead of taking money for the planes, the Government agreed to take 80 per cent of Concorde’s operating profits, if there were any. The significance of this was not just that it wiped the financial slate clean. It also allowed for the possibility of running Concorde on a different footing from any other airliner. The usual rule of airline economics is that a new plane must be ‘amortised’ before technology makes it obsolete and the airline has to buy a replacement. In other words, if you expect that you will be upgrading to the next Boeing or Airbus model in ten years’ time, you divide the price you paid by ten and work the plane so that every year it produces that amount of income and then some. You’re in a hurry. You need your aeroplane to begin to pay for itself now. But there was no upgraded supersonic passenger plane coming along. Concorde’s sell-by date was determined only by the lifespan of the machine itself. It would be the most modern thing of its kind till the last one could no longer stagger off a runway. And if its purchase price did not need to be paid off over a set number of years either, that meant that, uniquely, there was now no hurry at all. Concorde did not need to rack up the mileage. It could be cosseted in its hangar, and deployed only in situations where its unique qualities would be rewarded. It could be operated not for maximum utilisation, but for maximum profit. And this is what happened – which is why, twenty years later, the Concordes in BA’s fleet have still flown fewer hours than much younger subsonic planes.
So while King applied his medicine of cuts and redundancies to the rest of BA, he made sure that Concorde was nurtured and protected. He ordered the creation of a special Concorde Division to coax out the plane’s potential, effectively an autonomous ‘airline within an airline’. There was already an esprit de corps within the small world of Concorde pilots. ‘It was like a little Concorde flying club,’ Brian Trubshaw said. Those who had experienced the unique satisfactions of flying the plane tended to be emotionally committed to its existence, and were willing to do whatever was necessary to keep it airborne. King took advantage of this. Captain Brian Walpole was appointed General Manager of the new division, with a Concorde First Officer, Jock Lowe, as his assistant. It was the first time that the pilots had been put in charge. They set to work to build the brand, refitting the planes’ interiors with new leather seats and new carpets, sorting out the menus and stripping away the generic BA naffness that had afflicted Concorde in the 1970s. Then they turned their attention to the routes. Here they abandoned all the hopeful experiments, and concentrated operations in two areas only. For 5 to 10 per cent of the time, Concorde would fly charters sold through specialist travel agents, harvesting the wallets of aviation buffs who were fascinated by the plane itself. So began the tradition of supersonic package tours to Paris, to Vienna, to Lapland for Christmas. For the rest of the time, it would fly the Atlantic. BA had not quite given up on Washington yet, and later there would be a lucrative winter service to Barbados, but most important, Concorde flew London-New York, New York-London over and over again. To and fro it went in the purple stratosphere, carrying magnates and celebrities who had paid exactly as much as the market would bear. Till Walpole and Lowe took matters in hand, tickets cost around 25 per cent more than a standard first class fare. The Concorde Division decided to commission a straightforward piece of market research. They asked first-class passengers on BA’s ordinary flights across the Atlantic to guess what the Concorde fare was. The guesses were all a lot higher than first class plus 25 per cent. They raised Concorde fares to the average of the guesses. The price of a luxury, after all, is what people are willing to pay for it. As a result, although total demand for Concorde tickets was down during the recession of the early 1980s, all the planes that did fly flew full and generated much more money per seat.
All these changes were very much in the spirit of a remark made by Colin Marshall, the department store executive King later headhunted to be the airline’s CEO. His first question to one of BA’s senior marketing men was: why had there only been three cheeses on his Concorde flight from New York the previous day? Concorde had always had crises, but this time, the plane’s fate would not be decided by aerodynamics, or by international treaty obligations, or by industrial policy. This time it was not about the technology, or any of the implications of the technology. This time it was entirely about the finances, about the marketing. It was about the cheeses.
Only the very earliest results of BA’s change of direction showed up in the figures the Select Committee saw in December 1981. (Walpole and Lowe weren’t appointed until the next spring.) BA predicted a small profit of £1m or so for the financial year 1981-82, rising to £5.4m for 1982-83, and £7.4m for each of the years after that. But the gains on the income side of the balance sheet made much less of an impression on the net cost to the Government of keeping Concorde than the dramatic reductions that had been achieved on the expenditure side. The thing that had really changed was the projected support costs. The plans for supplying Concorde with spare parts and technical back-up had not caught up with the fact that there were only 16 Concordes in the world; the small fleet was being supported on a scale appropriate to a success story. It was true that Concorde’s support costs per plane could never quite be brought down to standard airliner proportions. Like it or not, there were certain fixed costs involved in maintaining a unique class of aeroplane, even if BA made the maximum use of resources such as the old Concorde prototype they kept behind locked hangar doors as a ‘Christmas tree’, stripping out its systems one by one for spare parts. But as BA went through the plans for the period up to 1987, they found they could delete £7m from the budget for engine spares; £5m for airframe spares, and so on. The biggest item, however, was the Concorde fatigue specimen kept at the Royal Aircraft Establishment in Farnborough. This was a full-sized Concorde fuselage rigged with heaters and strain gauges to simulate the effects of the roasting the plane got every time it cruised at Mach 2.2. Getting rid of it was controversial. Were they risking passenger safety? But 20,000 cycles of heating and cooling had already been logged on the test specimen, it was pointed out, and that was enough to guarantee Concorde’s immunity from metal fatigue well into the 21st century. The test rig went, at a saving of £36m. Adding all the cutbacks together produced a five-year forecast for net expenditure on Concorde of £40.9m. It was subtracting BA’s predicted five-year profits of £35m from that figure that in turn produced the stunning new estimate of only £5.9m to keep Concorde running.
Reporting all this to the Select Committee, Lamont said it would take ‘a few months or so’ to confirm that BA’s plan was working, that they were ‘getting the extra traffic they think is possible’. And then he made early use of a formula that was going to be repeated so often during the privatisations of the 1980s, in a multitude of variations, that it would virtually become a Thatcherite mantra. ‘The future in markets and the future in sales in any company are always subject to great uncertainties.’ Sometimes this careful shrug when a public asset was transferred into the marketplace insured the Government against a nasty surprise for investors, as in the case of the Rover Group, or the water companies, or British Coal. At other times, it covered the possibility that the asset in question might turn out to be a lot more productive when commercially exploited than anyone had realised.
Concorde, it turned out, fell into the latter category. As the results of BA’s new strategy began to come in, the airline’s estimated operating profit for the plane was revised upwards again to a likely £10.2m for 1982-83, and £10.7m per year thereafter. British officials now began to wonder whether BA could not adopt Concorde altogether. Could it not cover the plane’s costs entirely out of profits and take the whole thing away to where it need never be the responsibility of ministers, or ministries, or select committees again? This would certainly be an ideologically desirable exit. Concorde flies boldly into the private sector! What a spectacular vindication that would be of the ‘Tory philosophy’. The redemption-by-profit of Concorde created the terms on which Thatcher herself could consent to be proud of it, a token of the national greatness she continued to believe in even as she presided over the final massacre of Britain’s heavy industries.
Events now moved fast. At the Anglo-French meeting in May 1982, Lamont put the idea to his French counterpart, Charles Fiterman. Supposing Britain replaced its official obligations where Concorde was concerned with a set of equally binding commercial contracts – would that count, for France, as abiding by the Treaty? The French agreed that it would. The crucial unspoken assumption was that if it didn’t work out, Britain would not revert to state support of the plane. It was privatise or bust, and the French accepted that. So a letter was despatched to King at BA headquarters. The Department of Industry would be dropping Concorde’s support costs, come what may, at the end of March 1983. Would he care to pick them up? King asked for time to think. He said maybe.
On 2 April 1982 Argentine troops invaded the Falklands. While King considered, the British task force sailed, landed, fought a war, and won a victory that would ensure the survival of Thatcher’s Government. Concorde’s military cousin, the delta-winged Vulcan bomber, built to deliver the British nuclear deterrent in the days before Polaris, played a part. The last Vulcan squadrons were due to stand down in the summer of 1982, but it was decided to use the planes up rather than retire them. The speed governors were removed from the plane’s throttles – it didn’t matter if the pilots wore out the Vulcan’s Olympus 301 engines, ancestors of Concorde’s Olympus 593 powerplants. Paint was scraped from long-disused refuelling probes. The mankier planes were cannibalised for spare parts. Accompanied by a fleet of tanker aircraft, the Vulcans set off to fly the entire length of the Atlantic from north to south. It took 11 tanker-loads of fuel, pumped across in mid-air, to get two Vulcans from Britain to the Falklands, stopping off at Ascension Island en route. The Vulcans’ age soon showed. The last ones had been manufactured in 1964, and by now their systems were fragile. Refuelling probes snapped off in flight; cabin pressurisation failed; missiles jammed in the bomb bay of one, forcing it to land, extremely carefully, in Rio de Janeiro. Still the fat triangles came whipping in at Mach 1 towards Port Stanley, the grey swells flickering by 250 feet below, black exhaust from the Olympus 301s ruling a quadruple line across the sea from horizon to horizon. Still they soared as they reached their target; still they dropped their 21,000lb of explosives onto the Stanley runway.
The same family of technologies that made this journey possible made Concorde’s daily run to New York possible, too. One was the mirror image of the other. In Operation Black Buck, as they codenamed the Vulcan campaign against Port Stanley, the history of Britain’s V-bomber force ended with a bang no one predicted in a war no one foresaw. Yet it was Concorde’s seemingly routine transit across the Atlantic that was the true wonder – it passed the test inadvertently set by Leonardo da Vinci long before the dawn of real aviation. Wondering what use might be found for the flying machines he dimly envisaged, Leonardo suggested that people might ‘seek snow on the mountain tops and bring it to the city to spread on the sweltering streets in summer’. Passers-by in the hot streets of London and Manhattan would stop when they heard Concorde rumble, and tilt their heads to see the unmistakeable silhouette go by. It scattered intimations of grace which could fall into a frantic urban day like cold white stars. It dropped (as it were) snow, not bombs.
John King said maybe because taking over responsibility for Concorde involved a whole extra dimension of risk for BA. Until now, the airline had had to cover only its own running costs with the income it earned from operating Concorde. Money from Concorde ticket sales came in; payments went out for salaries, fuel, maintenance, airport charges and spare parts. What was left after these costs had been deducted formed BA’s operating profit as it had been defined in all the discussions to date. All the other charges associated with keeping the plane flying were borne by the Government. Now, though, it was being suggested that BA should expand its balance sheet to include all the transactions that presently took place between the Government and the plane’s manufacturers.
BA’s dealings with the aerospace companies had been nice and simple and limited up to then: just the usual relations between a buyer and a set of sellers. When BA needed a part for one of Concorde’s Olympus engines, they went to Rolls-Royce. When they needed something for the airframe, they went to British Aerospace. To replace a piece of the fuel system, they went to Aerospatiale. The companies had a catalogue price for each part and BA paid it. Simple. The problem was that the production lines turning out these spare parts had, again, been set up on the assumption that there’d be many more than just two customers. Manufacturing spare bits’n’bobs for a plane you’ve built is usually a lucrative business. In fact, some aviation companies generate the bulk of their profits from supporting the products their clients bought earlier – Rolls-Royce’s business model for its Trent aero-engine is a case in point. Here, however, the catalogue price that the contractors charged for the spares didn’t nearly cover the cost of creating them. The curse of the inverted pyramid had struck again: big cost structure, tiny utilisation of the capacity. Every year there was a shortfall, which the French Government took care of where Aerospatiale and the engine specialist SNECMA were concerned, and the British Government covered for Rolls-Royce and British Aerospace, in effect paying them a direct annual fee for sticking with Concorde. This was not optional. Without the spares Concorde would swiftly be grounded. So if BA were to become the sole custodian of the British Concorde fleet, it would have to take over the Government’s role, and start paying off the contractors’ shortfall on top of the list price for the spare parts. Which changed the whole basis on which BA calculated its operating profit. Suddenly, the airline was no longer looking at a projected surplus of £10m a year, but at a situation pushed way back towards the bare break-even point. John King had to ask himself if he was willing to tie up the chunk of BA’s capital that would be required to operate the plane, when the prospects were so uncertain of getting the kind of return that would justify the risk. Was the ‘halo effect’ worth it?
King’s first priority was to get the yearly subventions to Rolls and BAe reduced to the point where he could see a clear profit margin re-emerge. Through the summer of 1982, BA pressed the contractors to cut costs. King had a strong hand and he knew it. In March 1983 the Government would cut off Concorde support payments unilaterally and BA was the only candidate to take them over. Essentially, he pointed out, BAe and Rolls had the choice between earning less from their Concorde departments, and earning nothing at all. The contractors took the point. Assisted by the ingenuity of their Concorde staff, who were often committed to the plane in the same way that its pilots were (and King was not), they came up with a minimal plan for its support. BA’s accountants crunched the figures. The £10m-a-year surplus was gone for good, but an operating profit had reappeared in the projections. It varied between £3.5m and £5.4m, giving a £23m total pot of profits over the next five years. This was tight but it was doable. There was enough here to proceed to the next stage of negotiations – Concorde’s operational finances were only half the problem. There still remained all the questions to do with ownership.
On 13 December 1982 King wrote a formal letter to Iain Sproat, now the Under-Secretary of State for Trade. He laid out BA’s terms. If the airline could have the right to abandon Concorde in future; if in that case the airline would be safe from ever paying the contractors to make spares for Air France; if, above all, the price was right – then, there was something to talk about. BA was ready in principle to take on Concorde. The Government thanked the airline for its ‘positive attitude’, and in recognition of it, extended the deadline by one year, to make time for negotiations. State funding for Concorde would now cease from 31 March 1984, and this time the date was final. To thrash out the remaining problems, a Review Group was set up: representatives of the Departments of Trade and Industry (now merging into the DTI) would face negotiators from BA, led by the airline’s Director of Planning.
The events of the next year took place in a selection of conference rooms scattered around the DTI’s concrete behemoth of a building on Victoria Street. The members of the Review Group rarely gathered in the same room twice. Sometimes there would be a scenic view out towards Westminster, and sometimes there would be a window facing onto an airshaft, or no window at all; but there were always jugs of water on the table, and big cut-glass ashtrays, this being before government offices became smoke-free zones. Bruce MacTavish, aide to Lamont at the Select Committee hearing and now Head of the Concorde Branch at the DTI, co-chaired the sessions with Brian Walpole of BA’s Concorde Division. Each was flanked by colleagues. Rolls-Royce and British Aerospace were not represented: when input was needed from, for example, Brian Trubshaw, by then head of BAe’s Concorde Department, DTI officials would hold separate talks and report back. In theory, everyone sitting around the expanse of institutional tabletop was a state employee, since BA was still nationalised; but the company men and the Government men were divided by their opposing interests as much as any two parties are when one is buying and the other is selling.
Three issues dominated the negotiations. The first two – how much the airline should pay towards the remainder of the fatigue programme and how much it should pay the Government to quash the 80/20 profit share – were resolved, with BA agreeing a worst-case charge of £11.8m for the fatigue tests and £7.2m for the profit share, adding up to £19m out of the £23m pot. But the third item proved contentious. It became the needle’s eye Concorde had to pass through. The plan was that, when all the new contracts had been signed, BA would be left with clear title of ownership to its Concorde fleet, and also to the backlog of spares that had built up over the years as Rolls-Royce and BAe produced more parts than the airline’s anaemic Concorde ops required. This wasn’t just a question of rivets or fuel gauges or catches for luggage lockers; the spares included the dismantled equivalent of several complete Olympus engines. BA’s hope of managing technical support economically in the future depended on having access to them. In exchange for handing over the planes themselves and the reserve of assets built up during Britain’s long involvement with supersonic flight, those on the Government side of the table were looking for a single, comprehensive payment. Make us an offer, they said. So the men from BA did.
Unfortunately, the amount BA offered is not on record. It seems reasonable to assume that with £4m left of the £23m pot of profits, the number they came up with would have been somewhere around, or a little under, the £4m mark. They certainly imagined that it was going to be accepted. But the civil servants said no. Gravely, politely, but emphatically: no. They could not possibly part with equipment in which so much public money had been invested for that kind of price. Would they care to say how much they were looking for? No, they would not. It was up to BA to come up with an acceptable offer. Or if not, not. The BA representatives were aghast. To be sure, the figures could be stretched. But if they had to pay an amount that raised their total costs a long way above what could be financed plausibly out of Concorde’s income in the near future, it would push the operation into the zone of complete impossibility. The civil servants must know this, and yet they were pushing for it all the same, which implied a grim truth: that despite all the promising talk of the last two years, the Government was fundamentally resigned to Concorde going out of service. Sombrely, the BA team gathered up their papers and went back to BA headquarters, whose new name, Speedbird House, was now looking more than a little ironic. It seemed that all along they had misjudged the Government’s commitment to the negotiations. ‘Never was Concorde closer to being stopped,’ Brian Walpole told the witness seminar in 2000. ‘Dealing with civil servants,’ Brian Trubshaw told me, ‘nearly drove me mad.’ The plane appeared to be done for. It had tried to pass through the needle’s eye and had failed.
At least, that’s how the company side remembered it. Things looked very different from the Government side of the table, as I discovered when I talked to Bruce Mac-Tavish, the DTI’s former chief negotiator, who is retired and lives in Surrey. ‘Defeat never entered my mind!’ he said, chuckling a little at the mock-heroic ring of the sentence. He is terribly discreet, but as I went over the ground with him, a picture gradually emerged. The pilots and the engineers may sometimes have thought of MacTavish and his colleagues as dry souls, who knew the price of Concorde rather than its value, but as far as they were concerned they were makers and doers. MacTavish had been working on the administrative end of Concorde for almost a decade. He had been responsible for coming up with the formula, in 1979, that allowed BA to stop amortising its Concordes. ‘In words of which I’m inordinately proud, we resolved “to enter Concorde into BA’s books as a fully depreciated asset”. In other words, we wrote it off without saying we were writing it off.’ His colleague John McEnery was equally proud of minting the 80/20 formula. They, too, looked at the sky with pride when the unmistakable silhouette went by. Now that the fate of the plane was going to be decided on their own territory of well-drafted agreements and ingenious compromises, MacTavish and his colleagues surveyed the situation to see what they had to work with; for Concorde, as he put it to me, had ‘as many angles as a dog has fleas’. And they saw, far more clearly than the company negotiators did, that an agreement was politically almost inevitable. King had Thatcher’s ear, and the political clout that gave him had been invested in his claim to the plane. ‘He had put his dhobi-mark on it,’ MacTavish said – as if Concorde were a bundle of clothes that King fully expected to get back from the negotiating process pressed and folded. But, given that very sharp limitation on their bargaining position, it was still the DTI team’s duty to get the best possible deal for the taxpayer. ‘It was bad enough having to part with the original aircraft for nothing, but to part with the spares at a derisory sum, well, the Treasury wouldn’t have let us.’ So the DTI team decided that their best strategy for getting anywhere near the target figure for the spares that the Treasury had given them lay in playing down the inevitability of success. The grimmer the outlook seemed to be, the better. It was not, in fact, that the civil servants in the Review Group were fatalistic about Concorde; it was that they were much, much better poker players than BA gave them credit for. I asked if it was acrimonious. ‘I don’t think so,’ he replied. ‘There was just a lot of the “After you, Claude!” “No, no, after you, Cecil!” type of stand-off.’
Finally, after the BA finance department at Speedbird House had squeezed and massaged the profit projections again and again, and redefined the acceptable level of risk, and made the maximum allowance for the fact that the fatigue-test costs would fall due gradually, the offer on the table over at Victoria Street crept up to £9.3m. The civil servants smiled, and minuted as Paragraph 47 of the report that they recommended that amount ‘for acceptance by HMG’. Three pages later Paragraph 54 quietly acknowledged that the deal would be the end of an era. ‘The current programme of disposal by HMG of redundant items includes the means of producing further Concorde aircraft.’ It really was goodbye. But at least the planes themselves were saved, to fly for another 17 years, till the Charles de Gaulle crash. And, since November 2001, they have been flying again. On 31 December 1983, the day of the deadline, BA ceremoniously handed over a cheque for the £7.2m plus £9.3m that they owed the Government. Less than £17m to privatise a project on which nearly £900m had been spent – and Concorde, which had seemed all but dead two years before, jinked, sideslipped, and flew triumphantly through the eye of the needle.
When the witness seminar on Concorde convened, the old Concorde hands turned out to reflect on the history, the technology and the politics of the plane. But they also gathered to tell Concorde stories. One of the best was told by Captain Jock Lowe, who had, he said, once met the American pilot of an SR-71 Blackbird spyplane. This pilot had been on station in the stratosphere over Cuba one day, when he and his co-pilot got a crackly request from Air Traffic Control to move a couple of miles off course. ‘Eh?’ they thought; for not much moves in the thin air up at 60,000 feet that a spyplane can get in the way of. But as they sat there swaddled up like astronauts and plugged into their craft’s systems by a tangle of umbilicals, an Air France Concorde out of Caracas sailed by, ‘with a hundred passengers sitting in their shirtsleeves, eating canapés’. Another planeload of rich people had entered the kingdom of heaven.
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