 |
|
|---|
|
|
 |
 AIA UPDATE: April 2006, Volume 10, No. 7
Aerospace Caucus Considers Aviation Modernization Needs in First of Three 2006 Briefings Air Force Secretary Mike Wynne and FAA Administrator Marion Blakey discussed key military and civil aviation modernization challenges looming over the next 20 years at the first of three 2006 policy briefings hosted in March by AIA. Wynne affirmed the nation's requirement for the next-generation Joint Strike Fighter as a result of the aircraft's planned adaptation for each of the military services and its interoperability with the air combat forces of major NATO allies. The new fighter will enter full-rate production by the end of the decade and remain in service at least until the middle of the century. Blakey addressed the challenges of modernizing the air transportation system to achieve full security and integration among civil and military users. She stated that runway expansion and other airport capacity projects will become more vital as cargo and passenger volumes increase dramatically through 2025. Founded in 2001, the House Aerospace Caucus now has nearly 50 members of Congress from 20 states with significant national defense, space system, or civil aviation production facilities. The Capitol Hill briefings focus on legislative or regulatory issues that affect the ability of the aerospace and defense industry to create jobs and compete globally. Planned summer and fall sessions of the caucus include discussions of space exploration initiatives and the evolution of U.S. defense trade and cooperation programs. AIA Source: patrick.mccartan@aia-aerospace.org AIA Supports NASA Workforce Study for National Academy of Sciences AIA is supporting the National Academy of Sciences in a study to define the human resources needed to implement the president's Vision for Space Exploration. The academy asked AIA to help determine if NASA would have the engineering and science workforce necessary to develop the next-generation spacecraft known as the crew exploration vehicle (CEV) and, if not, would industry be able to fill the gaps. In working on the question, the association's Space Council developed a consensus that NASA and industry have sufficient workforce resources, with minor adjustments, to successfully develop the CEV. By 2018, when the agency begins to launch and sustain human exploration of the moon, the pool of human resources will have grown — with proper planning and coordination — through an array of workforce development programs already gaining momentum in industry, government, and academia. Association President and Chief Executive Officer John W. Douglass is serving as the aerospace and defense industry representative on the academy's NASA workforce committee. AIA presented preliminary findings in late February, and the academy will take testimony at additional hearings in early May. A final report is expected by February 2007. AIA Source: jana.denning@aia-aerospace.org AEROSPACE FOCUS  WASHINGTON PIPELINE: AIA Forging a Fix for Berry Amendment Metals Mandate By John W. Douglass, AIA President and CEO Many AIA members are well acquainted with the Berry Amendment, which mandates U.S.-manufactured specialty metals in Defense Department products. But a lot of other people have been talking about the law recently after press reports surfaced about changes in how the Berry Amendment is being administered. AIA has been engaged on the issue, working with DoD officials to make certain the problem doesn't impede important deliveries as well as lending our expertise to journalists writing on the topic. The issue surfaced last fall when AIA and member companies learned DoD officials had moved away from a 33-year-old policy regarding the Berry Amendment. In a 1972 policy memo former Defense Secretary Melvin Laird directed officials to avoid applying the law throughout the entire supply chain right down to small components such as fasteners. Laird said procurement on the subcontractor level "make(s) impracticable any precise evaluation of all such purchases, even at enormous expense in both time and money. It is apparent, from the legislative history of the provision, that it was not intended that this department achieve or attempt to achieve the impossible in its implementation." When industry realized the standard had changed, companies stepped forward to self-disclose potential problems in cases where subcontractors couldn't document that a domestic producer provided all the metal in every component. A main point we've been stressing to the press is that the problem in many cases is with documentation and nothing more. Industry has always complied with the spirit of the Berry Amendment by using U.S. suppliers for major components and structures. No one is suggesting otherwise. As we all know, the aerospace and defense supply chain has changed drastically over the past three decades, and these changes are at the root of the problem. With suppliers all over the globe providing complete or nearly complete components, it is sometimes impossible to track the origin of every item. Integration of commercially available components into finished products — as DoD has urged industry for years — also contributes to the issue. Reports of delivery delays and partial withholding of payments have been filtering into AIA in the last couple of months. A subsequent problem has surfaced in cases where the amount DoD withholds for the questionable parts or metal has been many times the actual value of the part. Examples of how the new enforcement is affecting finished products show the potential for a tiny component that contains only a small amount of specialty metal to hold up items that are vital to our national security. One AIA member company had delivery of a major subsystem valued at $5 million held up for several weeks because a third-tier supplier could not confirm the origin of a stainless steel wire screen that cost $1.35. In another case, one of several parts flagged for withholding on a final product worth more than $40 million was valued at 1 cent. AIA has been working on possible solutions to the issue for months. We have met with DoD officials on the matter, along with company representatives, and are hopeful we can resolve the issue through negotiations and create solutions for both the short and long term. WASHINGTON WATCH: Association Submits Testimony in Support of Export-Import Bank AIA President and Chief Executive Officer John W. Douglass submitted testimony to the Senate Subcommittee on International Trade and Finance in March on reauthorization of the U.S. Export-Import Bank (Ex-Im). The bank's charter must be renewed for another four-year period before Congress adjourns this fall. Douglass reminded the subcommittee that Ex-Im loan guarantees support the sale of U.S. airframes and aircraft components in emerging aviation markets around the world. "The Export-Import Bank contributes to the vitality of U.S. aerospace companies by expanding access to high-risk international markets and countering the aggressive industrial policies of foreign export credit agencies," Douglass testified. "These core missions of the bank," he asserted, "hold strategic value for aerospace because our sector of the economy exports 40 percent of its total output." Douglass also pointed out that the bank returns billions of dollars each year to the U.S. treasury through interest and fee charges. Finally, the testimony renewed AIA's call for Congress to establish — on a permanent basis — the bank's authority to finance international sales of non-lethal defense equipment for civilian purposes. The dual-use provision, which Congress has temporarily extended three times since 1994, promotes U.S. relations with non-traditional allies, Douglass said. "Most of the dual-use transfers approved by Ex-Im," he continued, "meet the needs of Central European, African, and Latin American governments in search-and-rescue operations, air traffic control upgrades, port security, forest protection, firefighting, and rural infrastructure development." For the full testimony, go to AIA's Web site at www.aia-aerospace.org and click on "Speeches & Testimony" under "News & Events." AIA Source: patrick.mccartan@aia-aerospace.org WASHINGTON WATCH: Small Business Health Plan Legislation Advances in Senate The Senate Health, Education, Labor, and Pensions Committee approved the AIA-supported Health Insurance Marketplace Act authorizing creation of multi-state, fully insured, small business health plans under the umbrella of a certified trade association. The bill would eventually allow AIA to develop a comprehensive and cost-competitive health insurance plan for interested members of the association's Supplier Management Council. Committee members noted that small businesses employ approximately half of the nation's 44 million uninsured fulltime workers. At the same time, small business health care premium and compliance costs have increased in recent years by as much as 30 percent. The full Senate must now consider the measure and resolve differences between it and a similar small business heath plan bill adopted by the House in 2005. AIA associate members will urge Congress to act quickly on the legislation when the supplier council convenes in late April for its annual conference. AIA Source: patrick.mccartan@aia-aerospace.org WASHINGTON WATCH: AIA Organizes New C-TPAT Initiative to Thwart Terrorism AIA conducted an organizational meeting recently to outline aerospace industry participation in the U.S. Customs-Trade Partnership against Terrorism (C-TPAT) initiative. A voluntary government and industry partnership led by the U.S. Customs and Border Protection (CBP) agency, the C-TPAT purpose is to prevent smuggling of terrorists or weapons of terror into the United States in import shipments. Qualified participants in the partnership must meet requirements that are subject to audit to ensure confidence in the security of their overseas and domestic supply chains. In exchange, companies qualify for "green lane" treatment of their shipments, thereby reducing CBP inspections and delays. AIA Source: remy.nathan@aia-aerospace.org Aerospace Industry Draws Guideline for RFID Data Exchange One of the most ambitious initiatives currently underway in the Defense Department is implementation of radio frequency identification (RFID), which will enable quick and accurate tracking of parts and equipment throughout DoD's inventory. RFID "tags" are similar to "EZ Pass" transponders that allow commuters to drive through toll booths at highway speeds. When RFID tags are attached to boxes or pallets an inventory database will automatically keep track of their location every time they enter or leave a facility or move within it. Although DoD has provided basic requirements for how RFID will be organized and implemented, many details are yet to be determined. AIA's Electronic Enterprise Integration Committee (EEIC) has provided some of the most crucial implementation guidelines in its Aerospace Industry Guideline for RFID Data Exchange, which is nearing approval for publication and will soon be posted on AIA's Web site. The guideline, including templates and samples, minimizes the burden of RFID requirements on the supply chain by recommending a standard solution set of file formats and methods of information transfer. The recommendations allow flexibility in choosing format and transfer mode according to a supplier's own technical capabilities. Even though the industry guideline is intended for the exchange of RFID data between industry partners, such as suppliers to prime contractors, the documented data requirements therein are compliant with Defense Department RFID requirements, which prime contractors must satisfy. The EEIC will ensure that possible changes in contractual RFID requirements are harmonized in future revisions of the industry guideline. Use of this industrywide "best practice" — a voluntary guideline — will facilitate, simplify, and reduce the cost of compliance with DoD RFID requirements by minimizing the number of data formats and data exchange methods required for partners to support. It would also limit the number of interfaces needed by primes and partners from their legacy systems that would otherwise have been needed to support these data exchanges in an environment where a common industry guideline did not exist. This guideline is similar to a related "unique identification guideline" published on the AIA Web site in 2005 that has gained wide acceptance in the aerospace and defense industry and in DoD. AIA Source: bruce.mahone@aia-aerospace.org Plan Now to Attend AIA 2006 Regional Meetings AIA regional meetings offer members an opportunity to learn more about top issues affecting the aerospace and defense industry. The agenda generally consists of two informative general meetings, supply chain sessions, networking opportunities, guest speakers, and plant tours of host facilities.
Aerospace Trade Is Key Issue in Russian WTO Accession Talks The United States and Russia are in the final stages of negotiations on a bilateral agreement that will enable Russia to join the World Trade Organization. Still being negotiated is the 20 percent tariff treatment of civil aircraft imported into Russia. The standard for most of the world is zero tariffs on commercial aircraft and related parts and components. AIA supports the free flow of commercial aircraft and parts between the two countries and hopes that the two sides reach an agreement that accommodates unrestricted free trade. AIA Source: remy.nathan@aia-aerospace.org. AIA Supports Global Trade at Asian Aerospace Expo in Singapore
Bruce Scott, the association's International Council chairman, led a press conference during the first day of the show, discussing the importance of the aerospace trade on both sides of the Pacific. "Aerospace industry sales are a boon to the global economy as well as certainly a boon to the U.S. economy," Scott, president of ITT Defense International, told reporters. "It's good news for everybody." Joining Scott were Lt. Gen. Jeffrey Kohler, director of the Defense Security Cooperation Agency, and Nancy Graham, director of FAA's Asia Pacific region. Each highlighted close ties between the United States and Asia in both civil aviation and defense. Kohler discussed the many important strategic relationships the United States has across the Asia Pacific region, which includes allies such as Australia, Pakistan, India, Japan, South Korea, Taiwan, and Singapore. "We build relationships; it's very important," Kohler said. "When we help our friends and allies build the capabilities to defend themselves and defend their borders . . . that benefits us, and it benefits them." Graham described FAA activities in the region, including helping various countries update their air traffic systems and promoting international safety initiatives. In addition to the press conference, AIA supported member companies as well as DoD distinguished visitors and flight crews, met with officials from similar organizations from other countries, and helped coordinate the U.S. ambassador's reception. AIA Source: matt.grimison@aia-aerospace.org Aerospace Trade Balance Rises on Record Exports and Higher Imports  The trade surplus generated by aerospace foreign trade in 2005 reached $40 billion.With a $10.6 billion increase in exports and $1.8 billion increase in imports, the industry's trade surplus expanded $8.8 billion above the 2004 balance of $31 billion.Foreign sales logged their second consecutive year of growth, rising 19 percent to a record $67 billion in 2005. Military aerospace exports rose $0.7 billion to $10.2 billion. Civil aerospace exports also increased, up $9.9 billion to $57 billion. The largest component of civil aircraft exports, commercial transports, comprised $22 billion of the total — up $3.3 billion from 2004. General aviation exports, on the other hand, rose sharply in 2005 — up $1 billion to $2.4 billion. Meanwhile, civil helicopter exports rose 80 percent to $565 million. In total, civil aircraft exports grew 25 percent. Exports of complete aircraft engines, engine parts, and aircraft parts increased $5.2 billion in 2005, reflecting in part the increased production rates of foreign civil aircraft producers. Exports of engine parts and aircraft parts totaled $28 billion and exports of complete aircraft engines totaled $7.2 billion. After doubling in 2004, exports of spacecraft, satellites, and parts dropped by half to $316 million in 2005. Despite an overall increase in imports in 2005, imports of complete civil aircraft fell $794 million to $10.9 billion. Aircraft engine imports increased 24 percent to $3.3 billion. Aircraft and engine parts imports increased $2.9 billion to $13 billion, also reflecting increasing domestic production of civil aircraft. In total, imports of aerospace products rose $1.8 billion, or 7.1 percent, to $28 billion. For detailed aerospace trade data, see www.aia-aerospace.org/stats/aero_stats/aero_stats.cfm. AIA Source: david.napier@aia-aerospace.org AIA-sponsored Team America Rocketry Challenge Set for Liftoff May 20 Excitement is building in middle and high schools around the United States in anticipation of the upcoming Fourth Annual Team America Rocketry Challenge, sponsored by AIA, 39 of its member companies, and others. Here is a digest of an article that appeared in a recent edition of Embraer News, the employee newsletter of member company and sponsor Embraer.
AIA, along with National Association of Rocketry, created the challenge four years ago in an effort to revitalize the aerospace workforce by inspiring young people to careers in aerospace. Embraer has supported the program from the beginning. Since the first contest in 2003, nearly 30,000 middle and high school youth have participated in the Challenge. "This has been a great opportunity for Embraer to reach out to our most precious audience and the future of our industry — young people," said Claudio Felix, Embraer's external relations manager in Washington, D.C. Competing in last year's challenge were students from Plantation High School in Florida, located near Embraer's North American headquarters. Three of the school's teams competed in last year's national competition, and two placed 2nd and 9th out of more than 700 teams from across the nation. Joseph Vallone, physics teacher at Plantation High School and coordinator of the teams, believes that "through this rocketry program, our students will become more interested in science and go on to major in the sciences in college, a field that needs to attract our most promising students." More information on the Challenge is at www.rocketcontest.org. AIA Is a Partner of Space Day 2006 Space Day is an educational initiative founded and supported by Lockheed Martin Corporation in collaboration with NASA. Space Day uses space-related activities to inspire and prepare today's youth for careers in science, technology, engineering, and mathematics. Throughout the year, thousands of students, teachers, parents, and space enthusiasts participate in Space Day educational programs and celebrations across North America. "Living and Working on the Moon" will ignite the imagination of 21st century space explorers, scientists, and inventors by focusing the attention of young people on the challenges and accomplishments of space exploration. This event will be held May 4, 2006, at NASA's Goddard Space Flight Center in Maryland. For more information on events celebrating Space Day 2006, go to www.spaceday.org. CAST Leaders Named Laureates by Av Week Leaders of the joint industry and government Commercial Aviation Safety Team (CAST) have been selected to receive a prestigious Laureate Award from Aviation Week & Space Technology magazine for their work in improving aviation safety. The award, given for leading the international aviation safety initiative's work in reducing the risk of fatalities in world commercial aviation, was scheduled to be presented to CAST's co-chairs at a magazine-sponsored dinner in Washington, D.C., in early April. The CAST leaders are Peggy Gilligan, FAA deputy associate administrator for aviation safety and the government chair, and Hank Krakowski, United Airlines vice president for corporate safety, security, and quality assurance and the industry chair. AIA Vice President of Civil Aviation Mike Romanowski is a member of CAST's executive committee. CAST produced its first safety agenda in 1998 and reports today that industry and government investment in 47 of the most promising safety enhancements could reduce fatality risk in commercial air travel in the United States by 73 percent by 2007. Other safety actions and regulations, along with new aircraft, could reduce fatality risk by as much as 79 percent by 2007, according to the safety team. The CAST model:
Headed to Farnborough? Why Not Sponsor an AIA Event? AIA members can achieve valuable visibility for their companies by sponsoring association events at the Farnborough International Airshow, July 17–23:
AIA Working for Passage of New Acquisition Excellence Legislation The industry coalition known as the Acquisition Reform Working Group has released its annual package of acquisition reform legislative proposals for consideration by Congress this year. Release of the legislative package last month is being followed up by informational meetings with congressional committee staffs. The working group represents virtually every element of government contracting, including large and small businesses, manufacturers, and service companies. It seeks to reduce costs, enhance efficiencies, and promote quality management as the federal government expands the use of commercial practices and reaches out more to the private sector to acquire goods and services. AIA has been very active in the working group, ensuring that its proposals include acquisition excellence priorities from the association's annual top issues list. This year's proposals from the working group include:
AIA has been working with the DoD and other federal agencies to align industry and government on common, constructive solutions as well as to ensure that Congress fully considers industry views on acquisition excellence before adjourning in the fall. Details of the recommendations are available on AIA's Web site at www.aia-aerospace.org. AIA Source: terry.marlow@aia-aerospace.org |
Copyright © 2008 Aerospace Industries Association. All rights reserved. Terms and Conditions Privacy Policy