September 9, 2020
By Karen Davison
What’s next for Aerospace?
It is no secret the COVID-19 crisis has had a devastating impact on the aviation and aerospace industry. Similar to the challenges in the automotive industry, companies must act quickly, adapt and collaborate in order to survive. So, what’s next?
I recently attended (virtually) SpeedNews’ 8th Annual Aerospace Manufacturing Conference, which prior to COVID-19, was to be held in Charleston – Don’t worry, SpeedNews will be back in Charleston in the future! Here are some insights from this year’s conference:
- Can I have a side of optimism please? Historically, the aviation/aerospace industry has recovered faster than anticipated in previous crises. We can hope the same holds true now. During this downtime, companies have the opportunity to focus on systemic problems that have been put on the backburner and possibly emerge stronger.
- Old is the new.. new (and improved). Discussions of NMA and new commercial programs have stopped, at least for now, as the industry is predicted to shift away from product development to more upgrade focused. Military programs, in particular, are expected to implement significant upgrades.
- Investing in employees yields dividends. While many operations must resort to (often huge and public) layoffs, and reduced employee salaries and bonuses, companies can still provide a work culture that helps attract and retain talent. Employers should consider offering career and professional development opportunities as well as mentor programs. Making employees feel valued for their contributions fosters loyalty. Flexibility and adaptation are also critical during these times, particularly while people are working from home and figuring out childcare options.
- Someone’s trash is another’s treasure. Accelerated aircraft retirement is expected (~3,300 planes over the next four years). This is good news for independent MROs as they can take advantage of the used, serviceable material of these aircraft.
- The comeback. By 2023, air travel demand is expected to reach pre-COVID levels. In addition, and due to the accelerated aircraft retirement and gradual ramp up in production over previous years, there is also an expected new airplane shortage in 2023. At this time, we expect to see a bounce-back for the industry.
Interested in the aerospace cluster in Charleston? Give me a call at the number below.
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