According to a new report from Santander and manufacturing organisation EEF, ongoing growth in air travel, particularly in emerging economies, as well as demand for high-tech parts for spacecraft and rockets will continue to fuel the sector’s rise.
While space tourism is in its infancy, the report said it represents a growing market and opportunity for the UK aerospace industry and its supply chain.
The UK is the second-largest aerospace manufacturer in the world, trailing the US, and is the fourth-largest aerospace exporter. It specialises in engines and aircraft parts, which make up 79 percent of all exports. Of that, 35 percent are exports of wings, fuselages, doors, control surfaces, landing gear and fuel tanks.
Paul Brooks, head of business development, Santander corporate and commercial, said: “The UK’s aerospace industry has thrived off the back of its competitive advantage in the production of high-value-added technology-intensive products, and we forecast that this will continue given that the UK is hardwired into the global supply chain. Since 2002, the UK industry has more than doubled overseas sales from £13.2bn to £28.3bn, an increase of 114 percent.”
Growth has occurred across all continents, though the report notes demand has been rising fastest in emerging markets. Exports to the Middle East have witnessed the biggest growth, up 540 percent between 2002 and 2016.
George Nikolaidis, the senior economist at EEF, said the sector is continuing to soar, by “staying at the forefront of cutting-edge technologies”.
“There are risks ahead no doubt but the sector looks well positioned to harness these challenges and remain a key player in the global aerospace industry going forward,” he added, with the report flagging the impact of Brexit uncertainty on investment decisions as a risk, as well as growing concern that exports will be hit by protectionist measures.
According to ADS, the trade body for aerospace, defence, security and space sectors, the UK industry has made a solid start to the year, recording deliveries of 100 aircraft in February, with a value of up to £2bn to the UK economy.
The total delivered to customers this year so far is 169 aircraft – four under the total achieved in the first two months of last year, which was a record total, and major aircraft firms will look to raise their production rates as the year goes on.
Current forecasts expect the final year total for commercial aircraft deliveries to be 1,528, ahead of 2016’s 1,443, with the demand for aircraft unrelenting.
Orders of 43 aircraft recorded during the month helped to keep the number of aircraft on manufacturers’ order books at the third-highest level recorded for civil aerospace.
Paul Everitt, chief executive of ADS group, said: “Today’s figures demonstrate continued success for the UK aerospace industry and good prospects for the rest of 2017. The industry is looking to build on 2016’s record year for deliveries, as all major aircraft companies look to increase their production rates.”