Forecasts 2007: Let the good times roll

What do the next 12 months have in store for the aerospace industry? In a series of articles, our journalists predict the future in their specialist areas

It has been a good 12 months to have been in aerospace. Even the crisis that engulfed Airbus and EADS over executive resignations, internal squabbles, A380 delays and threatened order cancellations was tempered by a record number of deliveries. Down the supply chain, first- and second-tier equipment and systems manufacturers, particularly in Europe, for whom a hitch in a key Airbus programme might have caused a bow-wave of misery, seemed unabashed as they focused on ramping up capacity to feed the voracious appetite of the airframe manufacturers.

In the USA, despite the slow efforts by the country's ailing domestic airlines to haul themselves into fleet replacement mode again, Boeing Commercial Airplanes and its suppliers continued to ride high on strong deliveries and the prospect of even better things down the line thanks to an ever-bulging 787 orderbook. Expansion by Asian carriers and in the European low-cost sector continues apace, with breakneck economic growth and a desperate lack of infrastructure in China and India, in particular, fuelling a seemingly insatiable demand for air transport.

This is all in the teeth of a soaring oil price that - other things being equal - ought to have sent the industry into an uncontrolled spin. The fact that it has not is testament to the underlying strength of the market.

In defence, the spike in procurement and programme funding that followed the launch of the war on terror and the Afghanistan and Iraq campaigns by the USA and its allies has levelled off, as Washington juggles other spending priorities alongside the rising cost of maintaining occupying forces in these theatres.

Stories of aerospace executives and senior pilots suddenly finding themselves jobless after 9/11 have rapidly been replaced by tales of woe from manufacturers and airlines facing massive skills gaps as older workers approach retirement. Although a number of manufacturers - including Bombardier in Northern Ireland - announced job losses, companies are more aware than ever of the danger of shedding skilled engineers and designers only to be found wanting when the next upturn in production comes along.

Business aviation, a casualty of the Wall Street slump that followed the World Trade Center attacks and the Enron crisis, has bounced back stronger than ever, with demand from emerging regions such as Europe, the Middle East and Asia - as well as new sectors such as air taxis - keeping the champagne corks popping in airframer boardrooms. With the likes of Honda, Piper and Embraer all rushing in at the lightest end of the market, the sector looks more dynamic than it has for a long time.

In spaceflight, although Europe suffered some setbacks in 2006, manned spaceflight took a giant leap with the return of the Space Shuttle, while the prospect of space tourism moved closer to commercial reality. After a hiatus of more than 30 years, which saw two Space Shuttle disasters, mankind seems on the verge of another great stride in space exploration.

One thing that changed little in 2006 was the structure of the industry, with no big mergers or takeovers, either in manufacturing or the airline sector. The emergence of Dubai Aerospace Enterprise - still a global player on paper only - was the biggest development.

With few signs to the contrary, 2007 looks like being another bumper year. In the following pages, our journalists cast their expert eyes over what the big developments are likely to be, and what icebergs could stand in their way.

Source: Flight International