The aerospace industry has been more resilient than expected to the impact of the financial crisis and, as a consequence, the long-anticipated steep downturn in airliner output has not materialized and probably will not materialize. This was the uncharacterically bullish perspective of GKN Aerospace CEO Marcus Bryson, who since 2008 has been warning of a decline in output and income and bracing the aerostructures maker for impact.
Bryson told AIN that the long backlog of airliner orders with which the aerospace sector entered the recession proved to be more durable than he had anticipated. There had been widespread concern that carriers would not be able to secure the financing needed to fulfill the massive orders many of them placed before the financial crisis went global. Professing himself to be delighted at having been proven wrong about the downturn, Bryson, at a May 26 press briefing in London, praised the decisive action taken by airframers Airbus and Boeing, as well as some governments, in quickly presenting alternative sources of finance to sustain the orders. He also said that the industry has proven to be very adept at juggling production and delivery schedules to avoid awkward gaps in output.
But surely once aerospace has expended the bountiful backlog it built up in the first eight years of the 21st century there is still the distinct possibility of a gap in output due to the fact that new orders have come at a more meager rate these past two years? That, concluded Bryson, depends on myriad macroeconomic factors that are still very much in the balance. One of these, according to many leading economists, is the all-too-real prospect of a double-dip recession resulting from a possible second-wave banking crisis now looming large in Europe. Other key factors, from GKN’s perspective, will be the timing of new airliner developments–most notably the timing of possible re-engining programs for existing Boeing and Airbus narrowbodies and the longer-term prospect of new-generation single-aisle jets.