AEROSPACE INDUSTRY
Literally, All
the World's a Stage
the World's a Stage
Globalization is old hat on the civilian side of the aerospace industry. In 2001, 45 percent of all commercial aircraft and parts in the U.S. were imported, compared to only five percent in 1960. Similarly, dominance by American jet builders of the international market has shrunk from a 95-percent share in 1960 to just under 50 percent today, according to researchers at the Canada-United States Trade Centre in Buffalo, N.Y. Foreign-made content has also increased dramatically in that time. One example: Just two percent of a 1960s-era Boeing 727 originated outside the U.S. By contrast, 30 percent of the content going into a Boeing 777 built in the 1990s came from foreign suppliers, according to the Centre.
The movement toward sub-assembling was evident in last year's search by The Boeing Co. for a location in which to build its new 7E7 "Dreamliner." Accessibility by rail and sea was among the project's basic requirements. "Some of the sub-assemblies are huge," explains Robert Pittman, a senior principal at Lockwood Green in Atlanta. "Good port access is critical because you can't move many of these parts over roads." The trend in aerospace manufacturing toward sub-assembly mimics what has already happened in automotive production, Pittman believes. "Today, it's the competitive way to build aircraft."
Boeing, which plans to assemble the 7E7 in Everett,
Wash., is now locked in a bitter struggle with Europe's Airbus for leadership in the jetliner market. With headquarters in Toulouse, France, Airbus shares a duopoly with Boeing in the design and manufacture of larger passenger aircraft. Charges and counter-charges of unfair trading practices have been hurled by both firms, with U.S. and European politicians joining the fray.
Early this year, Airbus began final assembly of its massive 550-seat A380 jet in Toulouse. The double-decker A380 aims for fuel efficiency, comfort, range and less noise than previous generations of large passenger jets. The aircraft has captured the interest of major airlines, with 129 total orders from eleven customers (FedEx Corp. has requested several copies of a cargo version). But the A380's business model, based on moving travelers to and from major global destinations, adheres to the traditional hub-and-spoke paradigm that has long dominated commercial air travel. Boeing's 7E7, in contrast, is smaller, seating no more than 300. It aims to provide point-to-point travel, offering greater efficiency for passengers and opening up non- stop service between mid-sized destinations.
"Major carriers are already being eaten alive by smaller point-to-point service," says Lockwood Greene's Pittman, who believes the approach may be the wave of the future. The hub-and-spoke system relies too heavily on hub airports. "When weather or security-related problems arise at the hub, the whole system can break down," he says. Dissatisfaction with hub-and-spoke has also reignited interest in corporate jets and air taxi services, according to Pittman.
In September 2004, Airbus again upped the ante, announcing it would begin developing a new aircraft that it would launch in late 2005. Company president Noel Forgeard declined to offer specifics on the project, though industry speculation is that the product would likely be a mid-market rival to Boeing's 7E7. "Airbus is bubbling over with new projects," Forgeard said.
The movement toward sub-assembling was evident in last year's search by The Boeing Co. for a location in which to build its new 7E7 "Dreamliner." Accessibility by rail and sea was among the project's basic requirements. "Some of the sub-assemblies are huge," explains Robert Pittman, a senior principal at Lockwood Green in Atlanta. "Good port access is critical because you can't move many of these parts over roads." The trend in aerospace manufacturing toward sub-assembly mimics what has already happened in automotive production, Pittman believes. "Today, it's the competitive way to build aircraft."
Boeing, which plans to assemble the 7E7 in Everett,
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| AvCraft consolidated operations from Ohio and Texas at a new complex on the decommissioned Myrtle Beach Air Force Base in South Carolina. The 60-employee operation has an employment goal of 350. |
Early this year, Airbus began final assembly of its massive 550-seat A380 jet in Toulouse. The double-decker A380 aims for fuel efficiency, comfort, range and less noise than previous generations of large passenger jets. The aircraft has captured the interest of major airlines, with 129 total orders from eleven customers (FedEx Corp. has requested several copies of a cargo version). But the A380's business model, based on moving travelers to and from major global destinations, adheres to the traditional hub-and-spoke paradigm that has long dominated commercial air travel. Boeing's 7E7, in contrast, is smaller, seating no more than 300. It aims to provide point-to-point travel, offering greater efficiency for passengers and opening up non- stop service between mid-sized destinations.
"Major carriers are already being eaten alive by smaller point-to-point service," says Lockwood Greene's Pittman, who believes the approach may be the wave of the future. The hub-and-spoke system relies too heavily on hub airports. "When weather or security-related problems arise at the hub, the whole system can break down," he says. Dissatisfaction with hub-and-spoke has also reignited interest in corporate jets and air taxi services, according to Pittman.
In September 2004, Airbus again upped the ante, announcing it would begin developing a new aircraft that it would launch in late 2005. Company president Noel Forgeard declined to offer specifics on the project, though industry speculation is that the product would likely be a mid-market rival to Boeing's 7E7. "Airbus is bubbling over with new projects," Forgeard said.
