Coronavirus Hits Aerospace: Financial Times

Pandemic has reversed optimistic forecasts from only a few months ago, hitting the global aerospace industry led by Boeing and Airbus with cancelled orders and halted production. Government lockdown policies have grounded over 60 percent of the world’s commercial aircraft. Reduced flights force airlines to cut costs and scramble for government aid to survive the hardship. Some 25 million jobs in the aerospace and airline sectors are at risk, according to International Air Transport Association, the aviation industry’s trade body. Boeing must also overcome reputation and security concerns in the aftermath of two fatal crashes of its 737 Max fleet. Aerospace companies represent significant revenue for not only tens of thousands of high-tech suppliers, but also the governments. In 2018, this sector accounted for the largest share of the EU’s high-tech exports at €94 billion. The crisis might benefit China’s Comac, which has strong state backing and already acquired aerospace suppliers in Europe and the United States. Western companies struggle to keep a technological lead when cash is scarce and banks may be unwilling to lend. – YaleGlobal