Aerospace supply chain needs capital, which isn’t always easy to find–and it may be expensive

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By Scott Hamilton

Feb. 13, 2023, © Leeham News: The aerospace supply chain is still struggling to recover from the grounding of the Boeing 737 MAX, the suspension of deliveries of the 787, the delays to the Boeing 777X, and the COVID pandemic.

Labor shortages and workforce quality/experience is also a challenge for the supply chain.

Profits remain elusive and capital is available at high interest rates, if at all. CFM, GE, Pratt & Whitney, and Rolls-Royce continue to face technical challenges with their engines. The CFM LEAP and PW Geared TurboFan engines have durability issues and must be taken off wing for maintenance and warranty work at a fraction of the time their predecessor engines were on wing.

It’s a rather bleak picture painted of the state of the aerospace industry during the annual conference of the Pacific Northwest Aerospace Alliance (PNAA) last week in a Seattle suburb.

  • Suppliers need capital; Boeing should return to 30-day payment terms for immediate capital injection.
  • Recovery not over, suppliers can make better investments in defense.
  • Without a new airplane, there’s no reason for suppliers to invest in commercial.

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