SIC 5088
TRANSPORTATION EQUIPMENT AND SUPPLIES, EXCEPT MOTOR VEHICLES



This industry is comprised of establishments engaged in the wholesale distribution of transportation equipment and related supplies, excluding motor vehicles. Ships (except pleasure craft), combat vehicles, guided missiles, and space vehicles are included in the industry. Self-propelled golf carts, railroad equipment, and aircraft parts and supplies are also included. Establishments primarily engaged in the wholesale distribution of motor vehicles are included in Industry Group 501 (motor vehicles and motor vehicle parts and supplies). Establishments primarily engaged in the wholesale distribution of pleasure boats are included in SIC 5091: Sporting and Recreational Goods and Supplies.

NAICS Code(s)

421860 (Transportation Equipment and Supplies (Except Motor Vehicles) Wholesalers)

In 2001, according to the U.S. Census Bureau, there were 3,730 establishments engaged in the transportation equipment and supplies wholesalers industry. These employed approximately 45,520 people, with an annual payroll of $2.1 billion. The total number of establishments increased to 5,786 in 2003. Together, they shared $22.4 billion in revenue. The average sales of individual establishments was about $4.6 million. The three states with the highest number of establishments were Florida, California, and Texas. Combined, they generated some $16.4 billion in sales. Maryland with only 103 establishments had sales of $23.2 billion.

Three separate specialties constitute this fragmented category. By number of establishments, the largest classification is aircraft and aeronautical equipment and supplies; followed by marine machinery, equipment, and supplies wholesalers; and other transportation equipment and supplies wholesalers—including sellers of equipment and supplies used by railroads, streetcars, buses, tramways, aerial hoists, and horse-drawn vehicles.

Aircraft and parts numbered 1,263 establishments, or more than 21 percent of the market. Aircraft equipment and supplies by themselves numbered 689 establishments, and shared almost 12 percent of the market. Marine supplies represented 678 establishments and also shared roughly 12 percent of the market.

During the early 1990s, the aerospace industry experienced declines in both the defense and civil segments. Although industry analysts anticipated recovery in the commercial segment of the industry during the second half of the decade, continuing stagnation in the defense

SIC 5088 Transportation Equipment and Supplies, Except Motor Vehicles

market was expected because of continued U.S. government downsizing. The best growth opportunities were for niche segments such as business and commuter jets, spare parts, and maintenance and overhaul in the commercial sector. Small commercial aircraft running regional services were a growing trend in the late 1990s. Industry performance as a whole continued to be mixed as the industry supplanted its defense-based revenues with commercial and industrial sales. The industry grossed an estimated $23 billion in 1996 and employed approximately 37,000 workers.

U.S. Airways Group Inc. of Arlington, Virginia, led the industry with 1999 sales of almost $8.6 billion. Two New York City-based firms—Mitsubishi International Corp. and Sea Containers America Inc.—followed with 1998 sales of more than $7.1 billion and almost $1.3 billion respectively. Houston-based Stewart and Stevenson Services Inc. generated sales of more than $1.2 billion for its fiscal year ended January 31, 1999. AAR Corp., headquartered in Elk Grove Village, Illinois, rounded out the top five industry leaders with sales of $918 million for its fiscal year ended May 31, 1999.

Stewart and Stevenson Services Inc. (SSSS) was awarded a $5 million Systems Technical Support (STS) service contract in early 2000 from the United States Army for support of its Family of Medium Tactical Vehicles (FMTV). The contract, administered by the Army's Tank, Automotive, and Armaments Command (TACOM), added up to $47 million in total revenue over four years. The company was extremely familiar with the equipment it would maintain, as SSSS manufactured 11,400 FMTVs from 1992 through 1998 for the Army.

U.S. Airways Group posted sales of $5.3 billion for 2003, a decrease from $7.0 billion for 2002. The company had been under bankruptcy protection, and successfully reorganized in 2003. That may change, however, according to a U.S. Airways spokesperson in a press release issued on May 7, 2004. The company has undergone cost cuts in an effort to situate itself for the scheduled arrival of new jets in 2005. Since the corporate credit rating had been downgraded, the company had been trying to cut back by about 25 percent. Unfortunately, if the company cannot get the financing needed it just may have to undergo "another bankruptcy filing if it is unable to do so." U.S. Airways Group employs approximately 31,700 people. Sea Containers America Inc. recorded sales of $1.6 billion for 2003. Mitsubishi International Corp. generated sales of $105.7 million for 2002, while Stewart and Stevenson Services Inc. posted sales of $1.2 billion for 2004. On April 15, 2004, Stewart and Stevenson landed an extended contract worth some $63.4 million for additional deliveries of their FMTVs from the U.S. Army TACM. This contract had been extended from an earlier contract in April of 2003. The total number of FMTV vehicles delivered to the U.S. TACM stood at more than 23,000.

Further Reading

D&B Sales & Marketing Solutions, May 2004. Available from http://www.zapdata.com .

Hoover's Company Profiles, May 2004. Available from http://www.hoovers.com

Infotrac Company Profiles, 18 February 2000. Available from http://web4.infotrac.galegroup.com .

"Sea Containers Announces Fourth Quarter and Full Year 2003 Results." PRNewswire, 8 March 2004. Available from http://www.seacontainers.com/investor_relations/ .

"Stewart & Stevenson Services Announces Receipt of $63.4 Million Contract Modification." PRNewswire, 15 April 2004. Available from http://biz.yahoo.com/prnews/040415/dath055_1.html .

"USAir Not Ruling Out 2nd Bankruptcy." Chicago Reuters, 7 May 2004. Available from http://story.news.yahoo.com

U.S. Census Bureau. Statistics of U.S. Businesses 2001. Available from http://www.census.gov/epcd/susb/2001/US421420.HTM .

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