The aircraft industry faces a difficult and challenging period. On the one hand, the reduction in the demands for military aircraft since the height of the rearmament programme has been substantial. On the other hand, the volume of production of civil aircraft during the next few years depends on the success of the manufacturers in selling the aircraft which are at present in course of production or development; and while I am optimistic of their success, it is unlikely that any increase in civil production will wholly offset the decline in military production.
An inter-departmental examination of the problems involved in this transition, including the future of Government policy on aeronautical research, is now being made. The Transport Aircraft Requirements Committee, which keeps under constant review all possible outlets for British transport aircraft, is also in present circumstances inviting the Society of British Aircraft Constructors into its discussions.
Lastly, it is desirable that the industry should reshape itself into stronger units. I have accordingly intimated to the industry that in placing orders for further requirements the Government will be influenced not only by the quality of design but also by the resources, technical and financial, available to complete the project quickly and successfully; and that, in so far as these criteria are not met in isolation, the Government will require the chosen contractor to work in association with one or more other contractors.