State of the Industry Presentation to ICAO
June 7, 2019
ICCAIA Chairman and AIA President and CEO Eric Fanning
Friday, June 7, 2019
Remarks as prepared
Thank you to all the members of the ICAO Council, the Council President, and the Secretary General for inviting me to speak here today. As many of you know, ICCAIA is made up of six industry associations representing manufacturers from the United States, the European region, Russia, Japan, Brazil, and Canada, and we plan to welcome more members into ICCAIA in the future.
Together, through regional and national associations, we represent over 1000 major aerospace manufacturing companies located in 23 countries. As the President and CEO of the Aerospace Industries Association of America, I’ve had the honor to serve as ICCAIA chairman since January.
This is my first State of the Industry address, and I want to use this time to speak about issues and opportunities in aviation, including what industry innovation looks like today; how we can ensure the right policies and regulations are in place to realize our potential; and how we can build on the inspiring past of our industry to have an even greater impact on the world in the future.
I am fortunate to be able to address you today as the representative of a thriving global aerospace and aviation industry. Our work relies on a truly global supply chain and global workforce. 2018 was another successful year our sector. While business jet deliveries were down very slightly – less than one per cent – both Airbus and Boeing had record years for commercial aircraft deliveries.
We’re looking forward to continuing this success. As manufacturers, the companies we represent are often some of the first to see the trends that will affect the whole industry in the future, like automation, additive manufacturing, and composites.
Moving forward, the outlook for growth is very strong, with Airbus and Boeing predicting demand for about 40,000 airliners in the next twenty years, worth around US$6 trillion. The Asia-Pacific region is expected to make up about half of this demand.
The aircraft that manufacturers are working to deliver now will support the considerable growth we expect to see in aviation in the coming decades. So as an industry, we have to be forward focused. Given the long life-cycles of the products we produce, an airliner can easily expect to be in service for 25 years. We must serve our customers by looking at the challenges we see in the future, not just today.
Some of these future challenges are ones we, and in fact the whole aviation ecosystem, have been thinking about for a long time. One of the most obvious is the environmental challenge. We must ensure we can deliver this growth in aviation and all the benefits it will bring around the world, while also fulfilling the long-term obligation we have made as an industry to reduce our CO2 emissions. Specifically, we’ve committed to a reduction of 50% from 2005 levels by 2050.
I’d like to commend the Council and Member States for helping keep us on track to deliver on that goal by committing to carbon-neutral growth next year when the pilot phase of CORSIA begins. This is just the first step – but it is an essential one.
Manufacturers are doing our part too in this challenge and will ensure our new aircraft continue the notable improvements we’ve seen over time. We must use all of the tools at our disposal, including sustainable aviation fuels, which will be just as important as new aircraft technology in reaching the environmental goals we’ve set.
But many of the challenges we are thinking about as manufacturers are much newer – challenges that weren’t even on the horizon a few years ago. Fundamentally, they’re about what aviation will be in the future.
Some of these are topics ICAO is already monitoring, like Urban Air Mobility – UAM – and Commercial Space. ICAO’s work on the Global Aeronautical Distress and Safety System will ensure aircraft are better tracked, leading to safer flights. And Remotely Piloted Aircraft Systems have pushed the industry forward on integration of this technology into our airspace
These technological advancements will challenge both ICAO and industry to evolve and ensure we aren’t too slow in recognizing the opportunities they bring. And a major part of this will be ensuring the proper regulations are in place for these new technologies.
Last year, AIA released a study – in partnership with Avascent – about the future of unmanned aircraft systems. It noted that one of the biggest obstacles to fully implementing these new technologies is not having necessary regulatory frameworks. Fortunately, this is something all of the associations in ICCAIA are thinking about.
Canada is currently preparing to launch its Vision 2025 report that will look at the barriers to growth and innovation. It will also look at how to overcome these barriers and inform a Canadian national aerospace strategy that helps the sector to thrive. The European industry has worked with the European Commission and other stakeholders to study how Europe can maintain a leadership position in aviation.
In the United States, AIA published a report called Vision 2050. It’s the result of a partnership with McKinsey and Company, working with over 70 industry experts to provide a comprehensive look at the future of the aerospace industry and the innovations that will shape the world over the next thirty years. The report lays out a future where drones perform new tasks, from repairs to deliveries; autonomous air ambulances transport patients to hospitals; and supersonics move business travelers around the world in half the time.
This report isn’t just an optimistic view of what’s to come. It’s also the beginning of a long-term effort to identify and advocate for the steps to reach that vision. Vision 2050 can inform our work and make sure our present actions in advocating for our sector and developing new technologies help achieve this future.
For instance, it’s helping guide efforts to implement a regulatory framework for UAM that ensures safe and efficient integration with Unmanned Aircraft Systems Traffic Management and protects the spectrum requirements for aviation safety. And the report is connected to the forward-focused actions so many ICCAIA members are taking.
Industry is moving forward with new technologies at a pace much faster than we are traditionally used to in aviation. Over $1 billion was invested in UAM technology in 2018 alone. In Europe, companies like Lilium have already performed their first unmanned test. In the United States, companies like Boeing, Embraer, and Bell are developing this technology and conducting test flights with the aim to be fully operational in cities around the world by the mid-2020s.
While aviation will change in the coming decades, the importance of coming together at ICAO will not. This body will continue to be vital in delivering a safe, secure and efficient global airspace. In fact, ICCAIA just recently increased the number of full-time staff we have in Montreal, as a recognition of the critical work being done here and the need for industry to have a more effective voice.
ICAO’s essential work on establishing a regulatory framework for safety has helped create the infrastructure we have today and the high level of safety in aviation. You’ve played an essential role in thinking about the coordination of higher altitude airspace across the globe. This will become increasingly important for new technologies, like weather observation, delivering internet to underserved parts of the world, or enabling commercial space operations.
And your expertise in bringing different states and industry together to ensure harmonization and interoperability where it is needed will continue to serve an essential role.
To ensure that these technologies realize their potential, ICAO must continue to engage with those at the forefront of innovation. While in many cases it will be manufacturers and members of ICCAIA enabling these technologies, we also need to ensure that we keep abreast with what the ultimate users of these technologies will be. We must use this as an opportunity to design a system that meets their needs as well as those of existing aviation actors.
But like the rest of our industry, ICAO will also have to evolve. Because our industry and world are changing.
Outside of new types of aircraft, we also have to consider new types of users of our airspace and how we can offer them the support they need as they work in new markets. New technology will help us reimagine and rework the way that goods and people are transported and the way that services are performed. Many non-traditional aviation industries – like the energy industry – are already using drones for power inspections. Drones are now critical to disaster recovery situations around the world, and as the technology continues to mature, so will the uses of it.
ICAO will potentially have to operate more flexibly than it has traditionally had to do, bringing future users into the ICAO ecosystem at an early stage. This will help ensure that innovation isn’t stifled and we don’t set overly prescriptive standards, but instead offer guidance to operators and regulators to enable performance-based standards. This won’t just help us learn from them, but also ensure they benefit from the knowledge and experience we have as regulators and different parts of the industry to guide them towards success.
It’s impossible to perfectly predict the decades to come. But just like we have for over 100 years, aerospace will clearly continue to move, connect, and secure the world we live in. And a vital part of that work comes from this body and the leaders in this room.
So, I look forward to another year of our industry – working alongside ICAO – paving the way towards a better and brighter future.