The aviation industry in particular has always been and continues to be characterised by great dynamism:
- Continuous increase in production rates
- New aircraft types at ever shorter intervals
- Adaptation of the supplier structure forced by the OEMs to increase efficiency in the supply chain
Increase in production rates
With an annual passenger growth rate of 5%, the demand for new aircraft is almost as high. Added to this is the need to replace ageing aircraft.
If you look at the delivery figures of the two big aircraft manufacturers Airbus and Boeing, you see a continuous increase over decades, interrupted only by major crises (the dollar crisis in the 1990s, the Gulf War and the terrorist attack on the World Trade Center in 2001).
Not a year goes by without Airbus or Boeing announcing a further expansion of their production.
Whereas at the beginning of the aviation industry it took 10 years or more for a new type of aircraft to be offered on the market, today this time span has shortened considerably. Aircraft manufacturers' customers are demanding new, economical, innovative products in order to improve their operating results and secure their market share.
Airbus alone has launched three new commercial aircraft types - the A380, the A350 and the A320 Neo - in 10 years.
The resulting shorter development times are an enormous challenge, not only for the manufacturers but also for the aerospace supply industry in particular.
Change in the supply chain
The strategy of the major manufacturers with regard to the supply industry is clear: fewer manufacturers with more responsibility. For some years now, this has gone so far that suppliers, as "risk share partners", are involved in financing the development costs of new aircraft types by having to carry out the development of their scope of supply themselves.
Of course, this also has clear advantages for the suppliers, as they can incorporate their know-how into the product within the framework of the specification in such a way that it can be produced more cost-effectively afterwards. However, the manufacturers' framework specifications are anything but stable, which leads to numerous and very costly changes in the development process.
Today, only suppliers with a sufficiently strong capital base can do this, which results in an almost "natural" consolidation process that makes the small companies merge with the big players.