Aerospace manufacturer

An aerospace manufacturer is a company or individual involved in the various

aspects of designing, building, testing, selling, and maintaining aircraft, aircraft
parts, missiles, rockets, or spacecraft. Aerospace is a high technology industry.

The aircraft industry is the industry supporting aviation by building aircraft and
manufacturing aircraft parts for their maintenance. This includes aircraft and parts
used for civil aviation and military aviation. Most production is done pursuant to
type certificates and Defense Standards issued by a government body. This term has
been largely subsumed by the more encompassingterm: "aerospace industry".
An Airbus A321 on final assembly
line 3 in the Airbus plant atHamburg
Finkenwerder Airport
Contents
Market
Largest Companies
Geography
Cities
Consolidation
Suppliers
Supply chain
See also
References NASA's AIM (Aeronomy of Ice in the
Further reading Mesosphere) satellite, assembled in
clean room
External links

Market
In 2015 the Aircraft Production was worth $180.3 Billion: 61% airliners, 14% business and general aviation, 12% Military aircraft,
10% military rotary wing and 3% civil rotary wing; while theirMRO was worth $135.1 Bn or $315.4 Bn combined.[1]

The global aerospace industry was worth $838 billion in 2017: Aircraft & Engine OEMs represented 28% ($235 Bn), Civil &
Military MRO & Upgrades 27% ($226 Bn), Aircraft Systems & Component Manufacturing 26% ($218 Bn), Satellites & Space 7%
($59 Bn), Missiles & UAVs 5% ($42 Bn) and other activity, including flight simulators, defense electronics, public research
accounted for 7% ($59 Bn).[2] The countries with the largest industry were led by the United States with $408.4 Bn (49%) followed
by France with $69 Bn (8.2%) then China with $61.2 Bn (7.3%), United Kingdom with $48.8 Bn (5.8%), Germany with $46.2 Bn
(5.5%), Russia with $27.1 Bn (3.2%),Canada with $24 Bn (2.9%) andJapan with $21 Bn (2.5%).[2]

In 2018, the new commercial aircraft value is projected for $270.4 billion while business aircraft will amount for $18 billion and civil
helicopters for $4 billion.[3]

Largest Companies
 Largest Aerospace Companies ($ billion)
Revenue Operating Profit
Company
2017[4] 2016[5] 2015[6] 2014[7] 2017[4] 2016[5] 2015[6] 2014[7] Country

Boeing 93.4 94.6 96.1 90.8 10.3 4.90 5.18 7.47 United
States

Airbus 72.3 70.8 68.8 80.6 3.70 2.40 4.34 4.50 EU

Lockheed Martin 51.0 47.2 40.5 45.6 5.90 5.55 4.71 5.59 United
States

United Technologies 30.9 29.0 33.1 36.2 3.83 3.84 3.00 4.57 United
States

GE Aviation 27.4 26.3 24.7 24.0 6.64 6.12 5.51 5.0 United
States

Northrop Grumman 25.8 24.5 23.5 24.0 3.30 3.19 3.08 3.20 United
States

Raytheon 25.3 24.1 23.2 22.8 3.32 3.24 3.01 3.18 United
States

Safran 17.9 16.8 16.6 18.3 2.58 2.54 1.71 2.74

France

BAE Systems 13.4 13.4 13.9 13.7 - - - - United

Kingdom

Rolls-Royce Holdings 12.7 12.0 13.2 14.7 1.11 0.98 1.77 2.15 United
Kingdom
Leonardo Italy
12.5 12.8 13.9 17.2 0.90 1.05 0.94 0.72
(Finmeccanica)

Geography
In September 2018, PwC ranked aerospace manufacturing attractiveness: the most attractive country was the United States, with
$240 billion in sales in 2017, due the sheer size of the industry (#1) and educated workforce (#1), low geopolitical risk (#4, #1 is
Japan), strong transportation infrastructure (#5, #1 is Hong Kong), a healthy economy (#10, #1 is China), but high costs (#7, #1 is
Denmark) and average tax policy (#36, #1 is Qatar). Following were Canada, Singapore, Switzerland and United Kingdom.[8]

Within the US, the most attractive was Washington state, due to the best Industry (#1), leading Infrastructure (#4, New Jersey is #1)
and Economy (#4, Texas is #1), good labor (#9, Massachusetts is #1), average tax policy (#17, Alaska is #1) but is costly (#33,
Montana is #1). Washington is tied to Boeing Commercial Airplanes, earning $10.3 billion, is home to 1,400 aerospace-related
T Georgia, Arizona and Colorado.[8]
businesses, and has the highest aerospace jobs concentration. Following areexas,

In the European Union, aerospace companies such as Airbus, BAE Systems, Thales, Dassault, Saab AB, Terma A/S, Patria and
Leonardo are participants in the global aerospace industry and research ef
fort.

In Russia, large aerospace companies like Oboronprom and the United Aircraft Corporation (encompassing Mikoyan, Sukhoi,
Ilyushin, Tupolev, Yakovlev, and Irkut, which includes Beriev) are among the major global players in this industry
.
In the US, the Department of Defense and NASA are the two biggest consumers of aerospace technology and products. The Bureau
of Labor Statistics of the United States reported that the aerospace industry employed 444,000 wage and salary jobs in 2004, many of
which were in Washington and California, this marked a steep decline from the peak years during the Reagan Administration when
[9]
total employment exceeded 1,000,000 aerospace industry workers.

During that period of recovery a special program to restore U.S. competitiveness across all U.S. industries, Project Socrates,
contributed to employment growth as the U.S. aerospace industry captured 72 percent of world aerospace market.
By 1999 U.S. share
of the world market fell to 52 percent.

Cities
Important locations of the civil aerospace industry worldwide include Seattle, Wichita, Kansas, Dayton, Ohio and St. Louis in the
United States (Boeing), Montreal and Toronto in Canada (Bombardier, Pratt & Whitney Canada), Toulouse in France and Hamburg
in Germany (Airbus, EADS), the North-West of England and Bristol in Britain (BAE Systems, Airbus and AgustaWestland),
Komsomolsk-on-Amurand Irkutsk in Russia (Sukhoi, Beriev), Kiev and Kharkiv in Ukraine (Antonov), Nagoya in Japan (Mitsubishi
Heavy Industries Aerospaceand Kawasaki Heavy Industries Aerospace), as well as São José dos Campos in Brazil where Embraer is
based.

Consolidation
Several consolidations took place in the aerospace and defense industries over the last few decades.

BAE Systems is the successor company to numerous British aircraft manufacturers which merged throughout the second half of the
20th century. Many of these mergers followed the 1957 Defence White Paper.

[10]
Airbus prominently illustrated the European airliner manufacturing consolidation in the late 1960s.

Between 1988 and 2010, more than 5,452 mergers and acquisitions with a total known-value of US$579 billion were announced
worldwide.[11]

In 1993, then United States Secretary of Defense Les Aspin and his deputy William J. Perry held the "Last Supper" at the Pentagon
with contractors executives who were told that there were twice as many military suppliers as he wanted to see: $55 billion in
military-industry mergers took place from 1992 to 1997, leaving mainly Boeing, Lockheed Martin and Raytheon.[12] Boeing bought
McDonnell Douglas for US$13.3 billion in 1996.[13] Raytheon acquired Hughes Aircraft Companyfor $9.5 billion in 1997.[14]

Marconi Electronic Systems, a subsidiary of the General Electric Company plc, was acquired by British Aerospace for US$12.3
billion in 1999 merger,[15] to form BAE Systems.

In 2002, when Fairchild Dornier was bankrupt, Airbus, Boeing or Bombardier declined to take the 728JET/928JET large regional jet
program as mainline and regional aircraft manufacturers were split and Airbus was digesting its ill-fated Fokker acquisition a decade
earlier.[10]

On September 4, 2017, United Technologies acquired Rockwell Collins in cash and stock for $23 billion, $30 billion including
gies expected by year four.[16]
Rockwell Collins' net debt, for $500+ million of syner
 [17]
Major aerospace and defence deals 2011-2017
Target Buyer Closed U.S. Bn
Precision Castparts Berkshire Hathaway Jan 2016 37.2
Rockwell Collins United Technologies Nov 2018 30.0
Goodrich United Technologies Jul 2012 18.3
Orbital ATK Northrop Grumman Jun 2018 9.2
Sikorsky Lockheed Martin Nov 2015 9.0
B/E Aerospace Rockwell Collins Apr 2017 8.6
Alliant Techsystems' A&D Group Orbital ATK Feb 2015 5.0
Exelis Inc. Harris Corp. May 2015 4.75
Avio S.p.A. Aviation Business General Electric Aug 2013 4.3
Titanium Metals Corp Precision Castparts Dec 2012 3.0
Firth Rixson Alcoa Jul 2015 2.85

The Oct. 16, 2017 announcement of the CSeries partnership between Airbus and Bombardier Aerospace could trigger a daisy chain
of reactions towards a new order. Airbus gets a new, efficient model at the lower end of the narrowbody market which provides the
bulk of airliner profits and can abandon the slow selling A319 while Bombardier benefits from the growth in this expanded market
even if it holds a smaller residual stake. Boeing could forge a similar alliance with either Embraer with its E-jet E2 or Mitsubishi
Heavy Industries and its MRJ.[18]

On 21 December, Boeing and Embraer confirmed to be discussing a potential combination with a transaction subject to Brazilian
government regulators, the companies’ boards and shareholders approvals.[19] The weight of Airbus and Boeing could help E2 and
CSeries sales but the 100-150 seats market seems slow.[20] As the CSeries, renamed A220, and E-jet E2 are more capable than their
predecessors, they moved closer to the lower end of thenarrowbodies. In 2018, the four Western airframers combined into two within
nine months as Boeing acquired 80% of Embraer's airliners for $3.8 billion on July [10]
5.

Suppliers
The largest aerospace suppliers are United Technologies with $28.2 Billion of revenue, followed by GE Aviation with $24.7 Billion,
Safran with $22.5 Billion, Rolls-Royce Holdings with $16.9 Billion, Honeywell Aerospace with $15.2 Billion and Rockwell Collins
including B/E Aerospace with $8.1 Billion.[21] The electric aircraft development could generate large changes for the aerospace
suppliers.[22]

On 26 November 2018, United Technologies announced the completion of its Rockwell Collins acquisition, renaming systems
supplier UTC Aerospace Systems as Collins Aerospace, for $23 billion of sales in 2017 and 70,000 employees, and $39.0 billion of
sales in 2017 combined with engine manufacturerPratt & Whitney.[23]

Supply chain
Before the 1980s/1990s, aircraft and aeroengine manufacturers were vertically integrated. Then Douglas aircraft outsourced large
aerostructures and the Bombardier Global Express pioneered the “Tier 1” supply chain model inspired by automotive industry, with
10-12 risk-sharing limited partners funding around half of the development costs. The Embraer E-Jet followed in the late 1990s with
fewer than 40 primary suppliers. Tier 1 suppliers were led by Honeywell, Safran, Goodrich Corporation and Hamilton
Sundstrand.[24]

In the 2000s Rolls-Royce reduced its supplier count after bringing in automotive supply chain executives. On the Airbus A380, less
than 100 major suppliers outsource 60% of its value, even 80% on the A350XWB. Boeing embraced an aggressive Tier 1 model for
the B787 but with its difficulties began to question why it was earning lower margins than its suppliers while it seemed to take all the
risk, ensuing its 2011 Partnering for Success initiative, as Airbus initiated its own Scope+ initiative for the A320. Tier 1
consolidation also affects engine manufacturers : GE Aviation acquired Avio in 2013 and Rolls-Royce plc is taking control of
Industria de Turbo Propulsores.[24]

See also
Aerospace
Aviation accidents and incidents
List of aircraft manufacturers
List of spacecraft manufacturers
Military-industrial complex
Aircraft parts industry
Aerospace industry of Russia
Aviation

References
1. Kevin Michaels (April 28, 2016)."MRO Industry Outlook"(https://www.aeromontreal.ca/download/fca8adddfff353/01-
MRO+Industry+Outlook_Kevin+Michaels.pdf)(PDF). ICF International.
2. Richard Aboulafia and Kevin Michaels (16 July 2018)."The Global Aerospace Industry Size & Country Rankings"(htt
ps://aerodynamicadvisory.com/wp-content/uploads/2018/07/AeroDynamic-Teal_Global-Aerospace-Industry_16July2
018.pdf) (PDF). The Teal Group / AeroDynamic Advisory.
3. Lee Ann Shay (Jan 2, 2018)."Commercial Spending Will Lead MRO Field In 2018"(http://aviationweek.com/commer
cial-aviation/commercial-spending-will-lead-mro-field-2018). Aviation Week & Space Technology. Comparing civil,
helicopter, business aviation and military MRO forecasts for 2018.
4. "Top 100 aerospace companies by revenue 2017" (https://www.flightglobal.com/asset/24628). Flight International. 3
Sep 2018.
5. "Top 100 aerospace companies grow more profitable" (https://www.flightglobal.com/news/articles/analysis-top-100-a
erospace-companies-grow-more-prof-440409/). Flight International. 1 September 2017.
6. "Top 100 Special Report"(https://www.flightglobal.com/file/?contentId=13060). Flight International. 13 September
2016.
7. "Top 100 Aerospace Companies"(https://d3fod5fkpt74ph.cloudfront.net/bef643f18cd3410788f767ce75e3e615/f99aa
5ad15a843bb899aa1f24f215e1e.pdf)(PDF). Flight International. 15–21 September 2015.
8. "Aerospace manufacturing attractiveness rankings"(https://www.pwc.com/us/en/industrial-products/publications/ass
ets/pwc-aerospace-manufacturing-attractiveness-rankings-2018.pdf)(PDF). PwC. September 2018.
9. Parker, Dana T. Building Victory: Aircraft Manufacturing in theLos Angeles Area in World War II, pp. 131-2, Cypress,
CA, 2013.
10. Jens Flottau (Jul 12, 2018)."Aerospace Consolidation Anew: Now It's The Commercial Airframers"(http://aviationwe
ek.com/commercial-aviation/aerospace-consolidation-anew-now-it-s-commercial-airframers)
. Aviation Week &
Space Technology.
11. "Mergers & Acquisitions - Aerospace & Defense"(https://imaa-institute.org/m-and-a-by-industries/#mergers-acquisiti
ons-industry-Aerospace-Defense). Thomson Financial, Institute for Mergers, Acquisitions and Alliances
.
12. Leslie Wayne (Feb 27, 1998). "The Shrinking Military Complex; After the Cold W
ar, the Pentagon Is Just Another
Customer" (https://www.nytimes.com/1998/02/27/business/shrinking-military-complex-after-cold-war-pentagon-just-a
nother-customer.html). New York Times.
13. "Boeing offering $13 billion to buy McDonnellDouglas" (https://www.nytimes.com/1996/12/16/business/boeing-offerin
g-13-billion-to-buy-mcdonnell-douglas-last-us-commercial-rival.html)
. New York Times. Dec 16, 1996.
14. "Raytheon wins bidding war for Hughes Aircraft"(https://www.flightglobal.com/news/articles/raytheon-wins-bidding-w
ar-for-hughes-aircraft-1467/). Flight International. 22 January 1997.
15. "All-UK merger sends European defence into disarray"(https://www.flightglobal.com/news/articles/all-uk-merger-sen
ds-european-defence-into-disarray-47309/). Flight International. 27 January 1999.
16. "United Technologies To Acquire Rockwell Collins For $30 Billion"(http://www.utc.com/News/News-Center/Pages/Un
ited-Technologies-To-Acquire-Rockwell-Collins-For-30-Billion.aspx)(Press release). United Technologies. September
4, 2017.
17. Michael Bruno (Sep 18, 2017)."Northrop To Buy Orbital For More Than $9B" (http://aviationweek.com/world-satellite
-business-week/northrop-buy-orbital-more-9b)
. Aviation Week & Space Technology.
18. Jerrold T. Lundquist (Oct 18, 2017)."Opinion: C Series Deal Ends Aerospace Status Quo"(http://aviationweek.com/c
ommercial-aviation/opinion-c-series-deal-ends-aerospace-status-quo). Aviation Week & Space Technology.
19. Michael Bruno and Guy Norris (Dec 21, 2017)."Boeing, Embraer Mull Combination That Could Reset OEM Industry"
(http://aviationweek.com/business-aviation/boeing-embraer-mull-combination-could-reset-oem-industry)
. Aviation
Week Network.
20. Jon Hemmerdinger (6 June 2018)."Mergers may fuel long-awaited E2 and CSeries sales bump"(https://www.flightgl
obal.com/news/articles/analysis-mergers-may-fuel-long-awaited-e2-and-cseri-449225/)
. Flightglobal.
21. Thierry Dubois and Jens Flottau (Jan 20, 2017)."Tier 1 Consolidation Continues As Safran T
akes Over Zodiac" (htt
p://aviationweek.com/connected-aerospace/tier-1-consolidation-continues-safran-takes-over-zodiac)
. Aviation Week
& Space Technology.
22. Michael Bruno (Dec 6, 2017)."Industry Landscape Could Reboot Under Aircraft Electrification"(http://aviationweek.c
om/commercial-aviation/industry-landscape-could-reboot-under-aircraft-electrification)
. Aviation Week & Space
Technology.
23. "United Technologies Announces Intention toSeparate Into Three Independent Companies; Completes Acquisition
of Rockwell Collins" (http://www.utc.com/News/News-Center/Pages/United-Technologies-Announces-Intention-to-Se
parate-Into-Three-Independent-Compan.aspx)(Press release). United Technologies. November 26, 2018.
24. Kevin Michaels (May 18, 2017)."Beware, OEM-supplier Relations Are Changing"(http://aviationweek.com/commerci
al-aviation/beware-oem-supplier-relations-are-changing)
. Aviation Week & Space Technology.

Further reading
Hartley, Keith. The Political Economy Of Aerospace Industries: A Key Driver of Growth and International
Competitiveness? (Edward Elgar, 2014); 288 pages; the industry in Britain, continental Europe, and the US with a
case study of BAE Systems.
Newhouse, John. The Sporty Game: The High-Risk Competitive Business of Making and Selling Commercial
Airliners. New York: Alfred A. Knopf, 1982.ISBN 978-0-394-51447-5.

External links
"U.S. Aerospace Industries Association".
"Aerospace, Defense & Government Services – Mergers & Acquisitions (January 1993 - December 2016)" (PDF).
Grundman Advisory. 6 Apr 2017.
Jens Flottau (Feb 22, 2018)."Opinion: Airframers Should Watch Where They Squeeze Suppliers". Aviation Week &
Space Technology.

Retrieved from "https://en.wikipedia.org/w/index.php?title=Aerospace_manufacturer&oldid=878083152

"

This page was last edited on 12 January 2019, at 22:18(UTC).

Text is available under theCreative Commons Attribution-ShareAlike License ; additional terms may apply. By using this
site, you agree to the Terms of Use and Privacy Policy. Wikipedia® is a registered trademark of theWikimedia
Foundation, Inc., a non-profit organization.