This category includes establishments primarily engaged in manufacturing aircraft parts and auxiliary equipment, not elsewhere classified. This industry also includes establishments owned by manufacturers of aircraft parts and auxiliary equipment and primarily engaged in research and development on aircraft parts, whether from enterprise funds or on a contract or fee basis. Establishments primarily engaged in manufacturing or assembling complete aircraft are classified in SIC 3721: Aircraft; those manufacturing aircraft engines and parts are classified in SIC 3724: Aircraft Engines and Engine Parts; those manufacturing aeronautical instruments are classified in SIC 3812: Search, Detection, Navigation, Guidance, Aeronautical, and Nautical Systems and Instruments; those manufacturing aircraft engine electrical equipment are classified in SIC 3694: Electrical Equipment for Internal Combustion Engines; and those manufacturing guided missile and space vehicle parts and auxiliary equipment are classified in SIC 3769: Guided Missile and Space Vehicle Parts and Auxiliary Equipment, Not Elsewhere Classified. Establishments not owned by manufacturers of aircraft parts but primarily engaged in research and development on aircraft parts on a contract or fee basis are classified in SIC 8731: Commercial and Biological Research.
332912 (Fluid Power Valve and Hose Fitting Manufacturing)
336413 (Other Aircraft Part and Auxiliary Equipment Manufacturing)
In 2001, the miscellaneous aircraft parts and auxiliary equipment manufacturing industry employed 123,000 workers, earning an annual payroll of $6.4 billion. Of these, 71,600 worked in production, earning $3.3 billion. The industry reported $23.4 billion in total shipment values.
The American aircraft industry can be divided into four segments. In one segment, manufacturers such as Boeing and Lockheed Martin Corp. build the wings and fuselages that comprise the airframe. Meanwhile, companies such as General Electric and Pratt & Whitney manufacture the engines that propel aircraft. The third segment covers flight instrumentation, an area where the most profound advances in aviation have taken place. But the fourth segment, broadly defined by the industrial classification "aircraft parts not otherwise classified," includes manufacturers of surface control and cabin pressurization systems, landing gear, lighting, galley equipment, and general use products such as nuts and bolts.
Aircraft manufacturers rely on a broad base of suppliers to provide the thousands of subsystems and parts that make up their products. There are more than 4,000 suppliers contributing parts to the aerospace industry, including rubber companies, refrigerator makers, appliance manufacturers, and general electronics enterprises. This diversity is necessary because in most cases it is simply uneconomical for an aircraft manufacturer to establish, for example, its own landing light operation. The internal demand for such a specialized product is insufficient to justify the creation of an independent manufacturing division.
Aircraft manufacturers have found it cheaper and more efficient to purchase secondary products from other manufacturers, who may sell similar products to other aircraft companies, as well as automotive manufacturers, railroad signal makers, locomotive and ship builders, and a variety of other customers. For example, an airplane builder such as Boeing, Grumman, or Beech is likely to purchase landing lights from a light bulb maker such as General Electric. Such subcontractors supply a surprisingly large portion of the entire aircraft. On the typical commercial aircraft, a lead manufacturer such as McDonnell Douglas may actually manufacture less than half of the aircraft, though it is responsible for the design and assembly of the final product.
When a major manufacturer discontinues an aircraft design, as Lockheed did with its L-1011 Tristar, a ripple effect is caused that affects every manufacturer that supplied parts for that aircraft. Therefore, parts suppliers strive to diversify their customer base to ensure that the decline of one manufacturer will be tempered by continued sales to others. Given the unstable nature of the industry, parts manufacturers also attempt to find customers outside of the aircraft business.
Aircraft parts manufacturing may be said to predate the invention of powered aircraft. The Wright Brothers' first airplane, little more than a propeller-driven kite, was equipped with cables, chains, and an engine that were built by others. In the purest sense, Orville and Wilbur Wright merely designed and assembled their aircraft from existing parts. The same was true of innovator Glenn Curtiss, a motorcycle repairman from upstate New York. While Curtiss had access to the lightweight engines required for flight, he began to experiment with flight controls and invented the aileron, a movable surface on the trailing edge of a wing that revolutionized handling characteristics. The Wrights had clearly invented the airplane, but Curtiss had undoubtedly developed a key control mechanism that made flight practical.
American aviation remained the province of tinkerers from the Wright Brothers' first flight in 1903 until 1916, when European combatants in World War I demonstrated the utility of aircraft as strategic battlefield weapons. The government hastily created an aviation program within the Army Signal Corps and held a competition for the right to supply more than 20,000 aircraft. Hundreds of amateur flyers, including Glenn Martin, Bill Boeing, Donald Douglas, and Allan and Malcolm Loughead, rushed into the business. Limited in their resources and working out of garages, these pioneers were forced to incorporate whatever parts they could find into their aircraft. The designs of these aircraft were simple, often consisting of fabric stretched over a wooden frame and manipulated with cables and hinges. But the most important part of these aircraft was the engine.
At the time, automobile manufacturers held a virtual monopoly on advanced engine designs. They also had the manufacturing capacity to mass produce the thousands of aircraft the government wanted. As a result, automobile executives easily muscled their way into control of the nation's aviation industry. While this arrangement bred only bad designs and corruption, it established an enduring organizational structure in the aviation industry. General Motors, Ford, Nash, and Packard had long subcontracted manufacturing of automobile parts to independent manufacturers. Unwilling to build manufacturing facilities for something as speculative as aircraft, these manufacturers simply turned to the established automotive supply network for items such as glass, wheels, instrumentation, and seats.
As quickly as they had entered, automobile companies abandoned aviation after the government canceled its 20,000-plane order at the end of World War I. Aircraft designers were once again in charge of their destinies as manufacturers. But they continued to be supplied by the very same parts network that served the automobile industry. Aviation enterprises floundered until 1927, when Charles Lindbergh's daring cross-Atlantic flight inspired tremendous investment in the industry. This growth was choked off after 1929, however, as the nation sunk into the depths of the Great Depression. Traumatized by changes in the industry, aviation companies continued to make small advances on the strength of military sales and a growing air mail business. Eventually this led to the formation of three enormous aviation combines, the largest of which, United Aircraft, might one day have rivaled General Motors in size.
United Aircraft consisted of four airframe builders: Boeing, Vought, Northrop, and Stearman, as well as the engine maker Pratt & Whitney, and a series of airline companies that later became United Air Lines. This powerful organization took over two propeller makers and numerous other manufacturers and began manufacturing a greater proportion of its own parts. The other two monopolies, North American Aviation and the Aviation Corporation of the Americas, were in the process of building similar organizations when, in 1934, the government stepped in with an antitrust investigation that broke up the combines and decentralized aircraft manufacturing.
This breakup provided new growth opportunities for a wide variety of potential suppliers. Companies that had previously never even considered the aircraft parts business suddenly discovered the viability of extending their product line into aviation. The driving force behind this expansion was technology. Where aviators were once limited to day flight, lighting and instruments enabled them to fly in darkness. Where navigation had once required visual landmarks, such as railroad tracks, now there were radio and gyroscopes. And where flying was once limited to lower elevations, now there were cabin pressurization systems and oxygen supplements.
The greatest advances in aviation took place during World War II. Heavy government investment in the industry enabled new technologies to be developed that enabled aircraft to fly higher, faster, and with more agility than ever before. This placed new stresses on conventional parts and encouraged the development of specialized engineering. Jet aircraft, first tested in 1942, provide the best example of this. While airframes had to be fundamentally redesigned to handle the rigors of jet flight, so too did items such as terminal wiring, indicator lamps, pumps, and fluid systems. Repeated exposure to vibration and powerful G-forces caused many conventional parts to break apart. As a result, the development of high-performance aircraft was hampered as much by weak light bulb filaments and rivets as by weak airframes.
The specialized engineering required for postwar aviation necessitated tremendous research funding and elevated manufacturing occupations to fine sciences. Companies that were ill-prepared for this new type of work were forced out of the market or into consolidation with other, stronger manufacturers. Aircraft contractors necessarily became fewer, and the prices of their products grew higher.
Generally, navigation and communications systems were handled by companies that specialized in instrumentation, such as Sperry, Lear, and Motorola. Meanwhile, with a few notable exceptions, heating, hydraulics, and pressurization systems were handled by engine manufacturers such as Pratt & Whitney, Curtiss-Wright, Allison, and General Electric. Manufacturers such as Garrett, Teledyne, Litton, and Dowty manufactured adjunct systems that provided compressed air, temperature regulation, cabin pressurization, and hydraulic pressure. Other companies historically associated with the automotive industry, such as BF Goodrich, Bendix, and Cleveland Pneumatic, provided products such as wheel assemblies, pumps, hoses, gaskets, and even window seals.
A large constituent in the industry consisted of companies that already were associated with aviation, including United Aircraft, Boeing, Lockheed, and McDonnell Douglas. Other smaller manufacturers, such as Cessna and Beech, also found a place in the market as suppliers of specialized parts. As a result of bad management, Curtiss-Wright was slowly forced out of engine manufacturing during the 1950s. But the company managed to maintain a leading position in the parts industry, particularly with propellers and a series of wing actuator systems.
Heavy government investment in aviation, primarily through military programs and a budding space agency, continued to result in ever more advanced aircraft. North American Aviation's B-70 bomber and Lockheed's SR-71 reconnaissance jet established new triplesonic speed records, while a variety of other craft managed to climb to more than 100,000 feet. Such planes required paint that exhibited special heat deflection properties. Even landing tires required coating with aluminum paints and inflation with lithium. Windshields were required to withstand tremendous impacts, such as collision with a bird at 2,200 miles per hour. In each case, aircraft parts suppliers never led development of new aircraft. Instead, lead manufacturers conceived of new designs and issued required specifications, and parts manufacturers filled their requirements.
While the Cold War confrontation with the Soviet Union provided the justification for new weapons, American involvement in Vietnam often provided the testing ground. New military designs enabled aircraft manufacturers to develop a further variety of new aircraft, including a supersonic passenger transport, jumbo jets, and huge freighters. Advances funded by military dollars helped lower the costs of commercial flight and allowed airline companies to offer passengers more sophisticated in-flight services, including radio headphone entertainment and movies. In addition, galley service became more efficient, incorporating microwave and convection heat sources, as well as complex food storage conveyors and dumbwaiters. As aircraft became ever more complex, the aircraft parts industry grew proportionally, until it numbered almost 11,000 suppliers.
The entire aerospace industry had enjoyed nearly 50 years of growth following the end of World War II, but an industry recession beginning in the late 1980s and early 1990s caused major shifts in the industry. Military spending peaked in 1987 and dropped precipitously following the end of Cold War tensions in 1989, forcing many military-oriented parts suppliers to leave the market. According to U.S. Industrial Outlook 1993, about 15,000 suppliers left the aerospace defense market between 1982 and 1987. This decrease continued into the 1990s, though at a slower rate. A similar decrease occurred in the commercial aircraft parts industry, as the supplier base dropped from 11,000 to 4,000, driven by aircraft manufacturers' demands for greater efficiency. "For parts suppliers, this streamlining has meant that only the most efficient and highest quality manufacturers have been able to stay in this market," noted U.S. Industrial Outlook 1993.
Exacerbating the effects of industry streamlining has been the increasing competition from foreign parts suppliers. In order to penetrate international markets, U.S. aircraft and aircraft engine makers have entered into international teaming agreements that specify that a certain proportion of parts are purchased from overseas suppliers. Such agreements have helped foster advances in the aerospace industries of many countries, particularly in the Far East, but have contributed to the shrinkage of the U.S. aircraft parts industry. Employment fell 13 percent between 1990 and 1992, and an additional 6 percent decline was expected in 1993. Total employment numbered 166,000 people in 1993.
The late 1980s saw a rash of problems associated with the manufacture of faulty and inadequate parts. The Federal Aviation Administration (FAA) sets guidelines for the quality and precision of airline parts and certifies the acceptability of manufacturers. However, prior to the appearance of bogus parts in the late 1980s it had no measures in place to enforce conformity with these standards. When aircraft mechanics discovered that parts of inferior quality had infiltrated the spare parts marketplace, several task forces set about to establish more stringent means of identifying and monitoring parts.
The problem of bogus parts continued to plague the industry in the late 1990s. The cause of a ValuJet engine explosion on the ground at Atlanta in June 1996 was determined to be an engine that had been overhauled by a repair station in Turkey that lacked FAA approval. The engine contained a crackled and corroded compressor disk. The National Transportation Safety Board (NTSB) uses the term "unapproved parts" in its official accident reports. A three-month investigation by Business Week revealed that bogus parts, including fakes, used parts sold as new, and new parts sold for unapproved purposes have found their way into the inventory of every major airline in the country. In 1996, some fire extinguishers intended for Air Force One were found to be falsely certified by a repair station.
While bogus parts were not routinely causing accidents, the problem of substandard parts had grown substantially in the 1990s. One supplier mislabeled spacers with fake Pratt & Whitney labels, but was caught by an astute airline mechanic. Clearly, parts are not labeled as bogus by the suppliers, but are laundered from used, stolen, or substandard parts, or are incorrectly specified as meeting standards via a number of means. Parts brokers adding false paperwork sell to unsuspecting brokers which sell to an unwitting FAA approved facility or airline. The FAA regulates manufacturers, repair facilities, and aircraft operators, but it is more difficult to regulate parts brokers. Although there have been hundreds of indictments and convictions, the airlines rely primarily on sharp-eyed mechanics to spot counterfeit parts.
A further concern of the FAA involved revisions requiring helicopters that were type-certified after 1989 to meet stricter seat load standards to improve the chance of survival of passengers and crew. The changes were a result of military pilots suffering from back injuries in crashes where the occupants were unable to exit the aircraft. These energy-absorbing seats are produced in the United States, United Kingdom, Germany, and Israel, and are optional to buyers of the helicopters certified previous to 1989.
By the new century, the manufacturing sector as a whole was seeing decline. Travel was on a steady decline and the economy had been slowing down for some months. This was only made worse when the terrorist attacks of September 11, 2001, caused the huge downturn of the U.S. economy and the sharp devaluation of the dollar, negatively impacting all manufacturing industries. The aerospace industry in particular was hard hit in the months and years after 9/11.
Despite the downturn in commercial aerospace industries, the military sector was kept stable by the rush to fund domestic defense efforts after the terrorist attacks, and by the war in Iraq shortly afterward. Overall, the market was not looking up, however, with a drop 2002-2003 revenue as a further consequence of the hits the industry took in 2001. By the early part of 2004, as the economy in general and airlines in particular began to improve, industry experts were looking forward to subsequent improvements in the market and the bottom line.
The industry as a whole expected and received difficult years during the early 2000s, with consistent drops in employment and sales each year. However, industry leader Barnes Group reported an increase in production orders for the largest aircraft engine built up to 2003. A new aircraft was expected to enter the market in 2004, which would require the new bigger engine. In addition, military orders were going up. Despite this, the industry in general was concerned that there was not enough government money to fund all of the new defense equipment, as well as new aircraft.
The 2001 industry leader was Barnes Group Inc. of Bristol, Connecticut. The company had $784.0 million in revenue and 5,200 employees that year, which had grown to $890.8 million and 6,026 employees by 2003. However, the company has several divisions, and these numbers are for the company as a whole. The Barnes Aerospcae Division saw sales fall 9 percent to $166.0 million from 2002 to 2003.
In second place was Triumph Group Inc. of Wayne, Pennsylvania, with $613 million in 2001 revenue and 3,700 employees. Triumph offered products such as control systems, non-structural composites, complex manufacturing processes, complex machining capabilities, and structural component forming. By 2004, the company had stopped manufacturing in its separate metals division, concentrating on aircraft needs. Rounding out the top three companies was Aviall Inc. of Dallas, Texas, an aftermarket parts manufacturer with $506 million in 2001 revenue and 800 employees.
A structural foam was developed by researchers at MER Corporation of Tucson, Arizona and the U.S. Air Force Research Laboratories Materials and Manufacturing Directorate. They successfully produced a one-foot-long test sample of graphite foam. As a replacement for aluminum and graphite honeycomb core and for use in aircraft structures, this development showed promise. The many advantages to this structural foam included high three-directional strength, net shape molding and integral bonding, and co-curing to face sheet composite fabric without adhesive on intermediate steps, according to MER Corp. CEO James Withers.
A further development in the industry dealt with a Millennium piston engine rebuild program in association with overhaul companies. Superior Air Parts of Dallas, Texas, developed rebuilds for the most popular Lycoming and Continental piston engine models, which perform to more exacting standards than the factory overhauled engines. The rebuilds also came with a five-year parts and labor warranty and included Superior's investment-cast Millennium cylinders. Montrose, Colorado's Western Skyways was the first engine overhaul facility certified to perform Millennium rebuilds.
Research also has been done by the U.S. Air Force (USAF) into seats that enhance aircraft occupant survivability. This notably pertained to ejection seats. Ejection seats enhance national security by saving the lives and operation experience of pilot fighters and thus were studied extensively.
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