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Thu, Dec 27, 2012

GA Growth Will Help Drive Aerospace Gains In 2013

AIA Predicts Modest Increases Over The Next Five Years

Sales of general aviation (GA) aircraft and related products and services are expected to increase modestly over the next five years, fueled largely by sales of business aircraft, according to the Aerospace Industry Association’s (AIA) 2012 Year-End Review & Forecast. The report also predicts that sales of larger business jets will lead the sector and account for as much as 40 percent of all GA aircraft deliveries over the next 10 years. AIA further predicts that by the end of the decade, roughly 20 percent of all global business jet deliveries will go to buyers in China, up from about 7 percent today.

AIA said total GA aircraft shipments, including those of business aircraft, will reach 1,705 units in 2013, up about 9.8 percent from 1,553 units in 2012. GA aircraft also would likely account for nearly 59 percent of the total civil aviation aircraft shipped in 2013. Total GA dollar sales are expected to increase next year by almost 14 percent to $10.8 billion from about $9.5 billion in 2012.

Once the final 2012 figures are in, AIA expects that overall aerospace and defense industry sales for the year will have increased by 3.4 percent, from $210.8 billion in 2011 to $217.9 billion. The sales increase is projected to be largely due to strong civil aircraft sales, including those of business jets, as well as increases in aerospace and defense exports, to an estimated total of $95.5 billion in 2012 from $85.3 billion in 2011.

Total sales of civil aviation aircraft are expected to reach $67.48 billion in 2013, an 11.4 percent gain from 2012’s predicted total of $60.59 billion. Total aerospace industry aircraft shipments are expected to increase to nearly 2,900 units – up more than 10 percent from 2012’s predicted total of 2,624 aircraft shipments.

Naturally, the improving market is creating more aerospace jobs. By year end, total industry employment is projected to have increased slightly in 2012 to more than 629,000 jobs from around 625,000 at the end of 2011. Despite layoffs at some facilities supporting military programs, overall employment is expected to grow because of increased civil aircraft output.

However, AIA President and CEO Marion Blakey (pictured) warned that the industry’s growth could be threatened should Congress fail to reach agreements that would forestall mandatory across-the-board tax increases and federal government spending cuts, which are due to take effect on Jan. 1. She added that forecasting the industry’s outlook for 2013 is extremely difficult, “given the cloud of fiscal-cliff uncertainties.”

Blakey added that much needs to be done to ensure the aerospace industry’s long-term health. She outlined some of the association’s top policy priorities for next year, which include promoting implementation of the NextGen air transportation system, export control reform, extension of the R&D tax credit, focused investment in defense procurement and R&D and progress on NASA’s human space exploration strategy.

FMI: www.aia-aerospace.org, www.nbaa.org

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