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U.S. Aerospace Industry Posts $151 Billion In Sales For 2001, Forecasts $6.6 Billion Decline In Sales For 2002

WASHINGTON, D.C., December 12 - The Aerospace Industries Association released figures today showing that the events of September 11 will cause a sharp contraction in industry sales as commercial transport production declines. At the association’s 37^th annual Year-End Review and Forecast Luncheon, AIA President and CEO John W. Douglass said that industry sales are projected to decline $6.6 billion, from this year’s near record figures of $151 billion. Describing the aerospace industry as a "trailing indicator," Douglass said that the impact of the terrorist attacks would become evident in the aerospace manufacturing industry next year, as companies make adjustments to the contraction of the civil aviation market. He noted that industry has already announced plans for layoffs of 60,000 to 70,000.

Speaking before 300 media, industry and government representatives, Douglass cautioned that all is not gloom and doom, as the industry posted near-record profits for 2001—an estimated $8.7 billion, up from $7.3 billion in 2000. This marks the sixth straight year that the industry has earned profits in excess of $7 billion. He added that sales for military equipment will increase next year, and will partially act to offset the reduction in commercial transport production.

Sales of missiles increased 14 percent to $10.8 billion in 2001, and space sector sales increased two percent to $31 billion. NASA and other non-defense federal agencies increased their space spending by $927 million, to $14.3 billion, while the Defense Department’s space spending increased only modestly. Commercial space exports remained down at $170 million in 2001—75 percent below 1998 levels. In March 1999, export licensing authority for commercial satellites and parts was shifted from the Commerce Department to the State Department. Douglass said the nation’s export policies continued to cast a shadow over this once vibrant sector of the aerospace industry, and he urged the administration and Congress to reform the nation’s export controls and license only those parts and technologies that are uniquely military.

He said that the trade balance for the aerospace industry improved in 2001 and remained the largest for all industry categories, despite an increase in imports in 2001. Imports of aerospace products increased 14 percent, to $32 billion, largely a result of increased imports of complete civil aircraft, up $1.9 billion, to $14 billion. Exports grew more than imports in 2001, increasing by 13 percent to $62 billion. The trade surplus generated by aerospace foreign trade in 2001 totaled $30 billion, or 11 percent above 2000’s balance.

P.A. Rel 2001-31

12.12.01

-AIA-

Contact: Matt Grimison, AIA
703-358-1076
matt.grimison@aia-aerospace.org