Record sales projected for aerospace industry

BUSINESS DIGEST

December 07, 2007|By Allison Connolly | Allison Connolly,Sun reporter

ARLINGTON, Va. -- The aerospace industry, which employs tens of thousands of workers in Maryland, should post record sales this year, and the trend should continue into 2008, the Aerospace Industries Association said yesterday in its annual report.

Led by increased shipments of commercial airliners and business jets, the association projects 2007 sales to be an all-time high of $198.8 billion, up from $183.3 billion last year. Next year, the association expects sales to rise 6 percent to $210.6 billion, with the civil aircraft business contributing more than half of those sales.

"I think it shows remarkable confidence in our industry," said Marion C. Blakey, the association's new president and chief executive officer, who presented highlights of the report to association members and the media at the Crystal Gateway Marriott hotel in Arlington. Blakey previously was administrator of the Federal Aviation Administration.

The association is expecting a slight decrease in defense sales next year because Congress has been reluctant to spend federal budget money on new equipment.

The space sector may also feel a crunch as the National Aeronautics and Space Administration prepares to retire the space shuttle fleet by 2010. A next-generation space vehicle, which is to take astronauts to the International Space Station and the moon, will not fly before 2014. Meanwhile, the United States faces growing competition from China, which is also seeking to put a human on the moon.

Going into an election year, spending on defense and space is "very much a question mark," Blakey said.

Jim Schwendinger, vice chairman of the global aerospace and defense industry sector for Deloitte Consulting LLP, said the industry probably won't grow as fast next year as this year but will be stable.

"Most aerospace executives I've talked to say they feel good about being sustained at this level," he said.

No matter who wins the presidential election next year, Schwendinger said, there probably won't be a drop-off in homeland security spending. He also said the government will have no choice but to repair and replenish the helicopters and air tankers that have been working overtime during the wars in Iraq and Afghanistan.

Schwendinger said his space clients are optimistic about a bump next year from non-shuttle-related business such as satellites and space-based weapons for surveillance and counterterrorism.

The aerospace industry added jobs this year for a total of 637,000 workers, up from 635,000 last year, the report said.

allison.connolly@baltsun.com

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