Ramon Lopez/WASHINGTON DC
The US aerospace industry will post a record $7.4 billion in profits on $140 billion in sales this year, and expects to see sales grow by $4.5 billion next year to $145 billion, according to the Aerospace Industries Association.
The US trade group, however, declines to make predictions beyond 1999, saying the industry has yet to see the major fallout of the Asian economic crisis.
AIA president John Douglas says the industry faces critical issues as US firms move through periods of economic and political uncertainty. These include streamlining of the US export control system, repair of the defence export loan guarantee programme, and the need for more aerospace research and development spending. Meanwhile, US aircraft manufacturers face efforts to implement tougher noise restrictions on their products.
Douglas advocates firm antitrust ground rules following the failed merger between Lockheed Martin and Northrop Grumman, . He says the Department of Defense is not ready to address the issue of major transatlantic defence mergers, but "-will have to do it someday whether ready or not".
Most of the 1998 sales gain came from rising commercial transport production. Sales of large civil aircraft alone increased $6 billion to an estimated $33 billion. Civil rotorcraft and the general aviation sector also gained this year, but the AIA says shipments of US-made civil helicopters are projected to fall in 1999 as the rotorcraft sector consolidates.
Total sales of military aircraft dropped this year although foreign sales softened the fall. Declining exports of missiles and "anaemic" Pentagon spending on missiles prompted sales to dive to $8 billion in 1998. On the plus side, weapons sales to the Pentagon are expected to rise $1.3 billion to $42 billion in 1999, as the mix of military aircraft spending shifts from research and development to procurement of Boeing F/A-18E/Fs, Lockheed Martin/Boeing F-22s and Bell Boeing V-22s.
Source: Flight International
