AIA Unveils “Roadmap to Recovery” to Guide A&D Industry’s Comeback
September 23, 2020
Arlington, Va. — Today, the Aerospace Industries Association (AIA) released its “Roadmap to Recovery,” a strategic action plan for how aerospace and defense companies can work with government leaders to recover from the COVID-19 crisis and emerge even more resilient on the other end.
To better understand the crisis’ impact on the industry’s employees, companies, and its shared supply chain, AIA turned to Avascent, Boston Consulting Group, and McKinsey & Company for expert analysis. This independent research combined with comprehensive input and insight from our members resulted in a report that both identifies how the crisis is undermining the industry and provides a blueprint to help guide its recovery.
“This crisis is not only devastating our aviation sector, its shockwaves are reverberating across the defense sector because of our shared supply chain,” said AIA President and CEO Eric Fanning. “While companies and government leaders have taken initial steps to support jobs and help businesses survive, the severity of this crisis requires additional action. AIA’s ‘Roadmap to Recovery’ provides a strategic blueprint to help ensure a strong comeback, one that ensures the health of our workers, the resilience of our industry, and renewed strength in America’s national and economic security.”
Central to the Roadmap to Recovery are several recommendations to help industry and government overcome the crisis:
- Restoring Confidence in Air Travel – To help rebuild public confidence in the safety of air travel, A&D is partnering with allies across the travel industry—including the International Air Transport Association, Airports Council International, Airlines for America, and other airline and airport groups—to highlight the many layers of prevention, protection, and safety built into the travel journey.
- Strengthening the Resilience of the Supply Base – The industry will work to optimize communication between original equipment manufacturers (OEMs), prime contractors, and suppliers to ensure suppliers receive clear, stable information about upcoming demand as early as possible, which will increase suppliers’ ability to plan, even during uncertain times.
- Flexible Actions to Support Suppliers – Flexibility is essential during periods of uncertainty and crisis for businesses of all sizes. Private companies can support flexibility in the supply chain by offering balance-sheet support and sharing inventory risk.
Proposed Government Actions
- Targeted, Temporary, and Transparent Payroll Assistance – Protecting jobs and keeping employees on payroll is a shared priority for American businesses and policymakers. Enacting a transparent payroll cost share program, extending key CARES Act programs, and continuing supplemental funding to cover payroll expenses would help companies continue to pay employee wages, salaries, and benefits.
- Broader Financial Relief for Civil Aerospace – Government leaders could develop a derivative of the Small Business Administration Small Business Investment Company Program and establish an equity and/or debt investment fund that would send government-backed capital to suppliers in need.
- Research and Development (R&D) and Science, Technology, Engineering, and Mathematics (STEM) Education Government Stimulus – Investment in cutting-edge technologies can help protect jobs and critical skills now, while also paying economic dividends in the future.
- Maintenance Repair Overhaul (MRO) Stimulus – To help minimize MRO service disruptions, government could create funding opportunities for viable U.S. airlines’ major upcoming/scheduled MRO shop visits.
- Accelerating Defense Procurement – The Department of Defense can help relieve some of the stress on the industrial base by accelerating defense system and service procurements, with a focus on initiatives that involve suppliers with notable commercial aerospace exposure, and continuing to authorize increased payments against ongoing contracts as they reach development and production milestones.
- Continued Sustained and Stable Government Aerospace and Defense Funding – Sustained and stable federal investment in aerospace and defense will help ensure America’s national security and technological edge and preserve the health of the defense industrial base.
For more information, please click here to read the full report.
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