US aerospace sales are projected to creep higher by less than 1% in 2010 compared to a year ago, as a surge of military deliveries overcame declines in commercial aircraft revenues, the Aerospace Industries Association (AIA) announced today.
"The prognosis for the industry appears better now than it did a few months ago," says Marion Blakey, AIA president and chief executive.
Overall sales are expected to rise from $214.5 to $216.5 billion in 2010, the AIA says. The industry-sponsored advocacy group also predicts sales will risely slightly faster in 2011, with growth in commercial aircraft for the first time in two years.
The most positive sign identified by the AIA is a 20% growth in orders compared to 2009. US manufacturers logged orders worth $195.7 billion in 2010, which is up from $163.5 billion a year ago.
"Orders bounced back this year," Blakey says. "This increase hopefully marks the bottoming-out of the recent decline in orders."
The backlog, however, is projected to increase slightly from $419.2 to $421.5 billion this year, suggesting that shipments are nearly outpacing orders. The industry's backlog remains below the $468.1 billion high posted in 2007.
The civil market is projected to decline by 6% to $48.2 billion this year, reversing a one-year rebound from a sales decline since peaking at $52.6 billion in 2007, according to the AIA.
But the slump could quickly be reversed. The AIA predicts revenues from commercial aircraft will rise next year to $50.2 billion, fueled by Boeing 787 deliveries and global economic growth.
But industry officials are also concerned that a "federal budget crisis" and legislative gridlock will dampen deliveries to the US military, the world's largest aircraft buyer.