Vertical Focus: News & Trends Impacting the Aerospace Supply Chain
Steeling For Tariff Impacts
What impact will the proposed tariffs on foreign steel and aluminum have on sourcing activity for domestic suppliers in the U.S. aerospace industry, which relies heavily on foreign aluminum?
Some interesting activity has already occurred. For example, sourcing activity for aluminum coils on industrial purchasing site Thomasnet.com is up 53 percent week-over-week—a huge jump in buyers looking for North American aluminum suppliers.
Thomas data also shows that sourcing activity for steel is up 24 percent month-over-month at Thomasnet.com. This increase in sourcing activity for North American suppliers of aluminum and steel could be indicative of manufacturers lining up domestic sources before the proposed tariffs kick in and prices for foreign metals soar.
Boeing Dreams Big
Singapore Airlines is the launch customer for Boeing's newest and biggest variant of its Dreamliner 787 widebody aircraft. The 787-10 version of the Dreamliner measures about 18 feet longer than the 787-9.
Dreamliner sales have been strong. The U.S. jetmaker has sold nearly 1,300 Dreamliners to airlines across the world. Of those, about 170 are for the larger 787-10.
With the delivery of its new 787-10, Singapore Airlines becomes the world's first airline to have all three variants of the Dreamliner, although its 787-8s and 787-9s fly under its low-cost subsidiary, Scoot.
The 787-10s, however, will fly flights for Singapore Airlines' operations only under its main brand. The carrier plans to use them for "regional" flights of up to eight hours.
Its 787-10 will fly from its hub in Singapore to Perth, Australia, and Osaka, Japan, according to the carrier.
Straight From The Source
SpaceX is on schedule to activate its south Texas launch site before the end of 2018, according to Teslarati. That is exciting news in the aerospace industry, as SpaceX owner Elon Musk has suggested that its launch site in Boca Chica, Texas, is under consideration as a testing site for a rocket to Mars.
"When you think back to the original space race between the United States and the Soviet Union over 60 years ago, private companies such as SpaceX entering space exploration is absolutely amazing," says Thomas President and CEO Tony Uphoff.
The Thomas Network at Thomasnet.com shows some interesting trends in aerospace-related categories:
- Sourcing activity for aerospace contract manufacturing is up 13 percent year-over-year, up 36 percent month-over-month, and over the past 12 weeks, it's up 17 percent above its historical average. This rise is a significant and steady upward trend in aerospace-related companies looking for manufacturers to make components or parts.
- Sourcing activity for aircraft & aerospace machining is up 14 percent above its historical average. Machining is closely related to contract manufacturing, as it is a process where the supplier cuts or shapes raw material into a part or component required by the customer. This service is a huge category in manufacturing, and an upward trend here specific to aerospace is a great indicator of the industry's strength.
Aerospace Trade Stats
- The U.S. Aerospace & Defense (A&D) industry generated $143 billion worth of exports in 2017. Over the past five years, A&D exports have grown by 26 percent, or from $113 billion in 2012 to $143 billion in 2017.
- A&D accounted for nine percent of all U.S. exports in domestic goods and is the nation's third-largest exporting industry.
- A&D is the nation's leading net exporting industry and generated a trade surplus of $86 billion in 2017.
- Exports of supply chain products including engines, components, and parts accounted for 56 percent, or $80 billion of total U.S. A&D exports.
- The U.S. is the world's largest exporter of A&D products and accounted for 34 percent of global A&D exports, up four percent since 2010.
SOURCE: Aerospace Industries Association