The aerospace industry has gone through a large amount of uncertainty over the past few years, with this being driven by a few notable trends. Despite this, there have been several signs that the industry is growing, such as higher employment and increased revenues.
This is driven by a few different trends that have become increasingly more evident recently. While market demand has been the primary driver of this, there have been a few other factors at play. These factors have resulted in certain trends beginning in the first place and speeding up and becoming increasingly more mandatory.
Key Trends In The Aerospace Industry
Information about an industry is one of the largest drivers of success, as it allows a company to evolve and adapt to an ever-changing market. As a result, those involved in the aerospace and defense (A&D) industry have had to pay a particular amount of attention to certain areas.
Focus On Asia-Pacific
The Asia-Pacific region has been re-evaluating much of its aerospace and defense needs in the past few years, with much of this being focused on its future resources and strategies. This has resulted in increased attention on the market from the United States and Europe-based companies.
Aside from the revenues that have been generated as a result of these partnerships, there are a variety of reasons that this has been the case. One of the more notable of these is that an expansion into the market can offset many of the risks involved in the industry. This is primarily because of a reliable and increasing demand in the region.
Alongside this has been that many companies have been taking a more decentralized approach to business. As a result, the Asia-Pacific has become a more attractive area to establish an additional headquarters.
Focus On Low-Risk Digital Innovation
When accounted for a percentage of sales, the aerospace industry has one of the lowest amounts focused on innovation, standing at roughly 4.1%. This hasn’t meant that companies in the niche haven’t been effective with their spending.
In contrast, much of this has been focused on low-risk, high-impact technologies received well in most markets. This has included artificial intelligence, sensory technologies, and robotics, each of which has taken up the majority of innovation investment.
While the variety of areas that this has been focused on has been limited, it has had a large return on investment. This has been seen in reduced long-term costs, such as in labor, repairs, and maintenance.
Companies have often focused on these low-risk areas, as there have been many cases where opting for higher risks haven’t paid off.
Though innovation has been limited, aerospace companies have been modernizing their platforms in a variety of ways. This has been driven by the fact that many of these systems have been outdated and considered legacy software, which provides a host of challenges.
However, the modernization process has been relatively slow, which means that it will take a considerable amount of time for it to take place. While this may be somewhat faster for newer firms, larger multinationals may lag with much of this.
Despite being slow to begin, this has already started to pick up steam in recent years. Much of this has been due to newer and more specialized equipment, which demands modern platforms to operate on.
Implementation Of More-Electric Aircraft
Fuel has been one of the larger costs associated with maintaining operations, which has led to many firms aiming to reduce this as much as possible. One of the primary ways that they’ve been able to do so is by moving toward more fuel-efficient aircraft, with More-Electric Aircraft (MEA) being the first step.
There is a more long-term goal with this: the move to All-Electric Aircraft (AEA), although this is an increasingly complex process. As a result, firms are taking a more incremental approach by integrating their current equipment with newer components.
Alongside this is a certain amount of research into research and development. Coupled with the low volume of funds directed toward innovation, however, this has been a somewhat elongated process.
It’s been over two decades since there’s been much consolidation in the aerospace niche. The industry looks to surpass much of this, as there has been a staggering number of mergers and acquisitions (M&As) over the past few years. This shows no sign of slowing down in the coming years.
There have been a few reasons for this, with long-term cost savings and increased production rates being more notable. Alongside this is the opportunity to fund more research and development, which could further enhance cost-efficiency and production.
This has meant that many larger firms have been focusing on purchasing small-to-medium-sized businesses that have been specializing in the research and development phase of the industry.
Autonomous Flight Systems
Autonomy has been a growing trend in the majority of industries in the past few years and has impacted them in several years. The aerospace industry is no exception. Much of this has been focused on increasing autonomous flights, with the end goal being to launch fully human-free flights shortly.
While this may still be several years away, investments and innovation will consistently be geared toward this in the coming years. We should see planes being cut down to just one pilot and subsequently becoming unmanned in the coming years.
This has already occurred with drones, although this technology will need to be scaled-up before it’s ready for larger planes and longer journeys.
The maintenance, repairs, and operations (MRO) part of the aerospace industry has often been one of its more complex aspects. This has become especially true as technology has become increasingly advanced. Alongside this have been the costs that are associated with each of these.
As a result, many commercial airlines have looked for ways to reduce these costs. Much of this is being tackled by simulated data, which allows airlines to plan their maintenance and repairs ahead of time.
By taking a cautious approach, companies can reduce the costs associated with each of the above by predicting when issues will arise and subsequently avoiding them. However, this hasn’t been too effective with newer advances, as there are fewer data points to draw upon.
Advances in materials have led to a variety of possibilities for aerospace companies. The majority of this has been seen through the increased use of carbon nanotubes and graphene, both of which provide several benefits.
The most notable of these have been seen by making planes more efficient by reducing weight and less fuel consumption. As a result, there can be a lower cost associated with traveling.
This could lead to further advances in the field, as NASA and MIT scientists have been using these materials to create more advanced wings that could provide more benefits to the niche.
Complexity is one of the more defining trends across any aerospace process. This has meant that those in the field have had to determine more ways to make this simpler while retaining accuracy and reducing risk. One way that this has been done is through the use of Multiphysics simulations.
This is something that has taken a while to catch on in the industry, thanks in large part to many companies still being attached to legacy systems. As this changes, however, multiphysics simulations look to become increasingly more common across the industry.
There can be a variety of effects with this use, although the extent of it may be difficult to determine. In many cases, it should allow companies to enhance their work with single physics domains.
During the research and development phase of any product, its production is often the most expensive area. There have been several ways that the industry has been looking to reduce this, with 3D printing becoming one of the most common.
Alongside the cost reduction that’s seen with 3D printers, companies can see significantly less time being spent on the R&D phase. By doing so, firms will be able to reduce the time it takes to design a product and release it to the market.
Aerospace Industry Stats and Growth Projections in 2021
Many of the trends that have been facing the aerospace industry have made themselves evident in a variety of statistics. This has meant that there are a few that every company in the sphere should know.
- The United States Aerospace and Defense industry (A&D) employs 13% of the manufacturing workforce, about 2.4 million people as of 2016.
- The average salary in the aerospace industry is 44% above the national average.
- Exports in the industry continue to increase, having jumped 26% from 2012 to 2017.
- The A&D industry accounts for 9% of the United States’ exports.
- Five states account for 55.1% of exports, namely, Washington, California, Connecticut, Texas, and Florida.
- The industry is expected to grow an average of 5% through 2031.
- Spending on innovation remains relatively low as a percentage of sales, with this averaging 3.6% in the United States.
- The A&D niche accounted for 6.1% of all value added to the manufacturing industry.
- A&D was responsible for 5% of value-added in 15 particular states, which subsequently accounted for 71% of the value it added to manufacturing in general.
- America holds the largest share of key players in the global aerospace market, with a share of 52%.
Data is vital to the success of a business in any niche. By focusing on the various trends that are affecting the aerospace industry, both small and large companies will be able to position themselves for the future. This can make or break any business, regardless of its size.