Compendium of Aerospace & Defense sector Performance – Q2FY20

It is common knowledge in the industry that commercial aerospace has had the longest run of growth in decades, and globally defense spending has been on the rise in the years following The Great Recession.

Due to  COVID-19 pandemic, companies in the A&D sector, especially, the commercial airlines & original equipment manufacturers (OEMs) and their suppliers in the aircraft production ecosystem are facing an unprecedented period of uncertainty.

Meanwhile, for many companies in the sector, it will mean taking every measure possible to survive.

 The aircraft manufacturing industry faces major challenges:

  • The turmoil in the commercial airline industry would have direct negative effects on producers of aircraft via a decrease in new aircraft orders —or cancelled existing ones.
  • Reduced demand for materials and components will likely affect not only the OEM’s but also likely ripple throughout the supply chain to suppliers (ancillaries).
  • Bridge the time until the demand for new aircraft returns, while keeping the aerospace supply chain alive and healthy.
  • Ramp down and adjust the size of the aerospace supply chain to the “new normal” sustainable production level in the medium term.

Defense companies issue :

The defense companies would experience supply chain disruptions due to the financial impact on partners and suppliers that may have to slow or halt production as in the case of two F-35 facilities in Italy and Japan that paused production.

The global aerospace and defense (A&D) industry has experienced a minor decline in 2019, primarily due to the sluggishness in commercial aircraft production, and a complete disruption in 2020 as the COVID-19 pandemic deepens and widens. Defense remained strong on account of robust defense spending in the United States as well as from other major regional powers. The A&D industry is likely to see its worst time in 2020 as Commercial aircraft producers should expect continued weakening links in their supply chain, as some vendors and suppliers will likely face operational or financial struggles of their own. However, commercial aerospace sector growth is likely to get better from 2021 onward as the long-term demand for commercial aircraft continues to remain robust.

Here, in this report, we discuss the performance of the Aerospace & Defense companies and how they have been impacted by the C-19 pandemic  :

  • BA
  • AIR.PA
  • LMT
  • GD
  • NOC
  • AVAV
  • TXT
  • AAXN
  • DCO
  • HEI
  • HXL
  • KTOS
  • HWM
  • MRCY
  • AJRD
  • SPR
  • MOG-A
  • ATRO
  • CW
  • TRNS
  • HON
  • LHX
  • MANT
  • AIR

For details on each of the above company, sector outlook and regional standpoints, please feel free to refer to the following compendium reports from CrispIdea.

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