Boeing is the most powerful brand in aerospace and defence. That claim may hardly be surprising, given that it is also the biggest company. In fact, according to a new survey by brand valuation and strategy consultancy Brand Finance, the top 10 most valuable brands in the industry belong to 10 of the largest businesses by turnover, as ranked by FlightGlobal’s Top 100. However, what is revealing is that Brand Finance reckons Boeing's brand is worth just short of $20 billion, more than $3.5 billion more than it was valued at in 2017, and almost $9 billion more than arch-rival Airbus.
The increase in the Chicago-based company’s brand equity is down to several factors, says the consultancy. These include the fact that it passed the 1,000-order mark with the 787 and commenced production of the 777X, and, just as the report was being published, announced its new joint venture with Embraer on commercial aircraft.
The reason for the gap with Airbus is largely Boeing's strong defence business at a time when military budgets are increasing in the USA and around the world, says Brand Finance.
The third-most powerful brand in aerospace is defence giant Lockheed Martin, with a value of $8.3 billion. The rest of the top 10 – General Dynamics, Northrop Grumman, Safran, Rolls-Royce, BAE Systems, Raytheon, and United Technologies – have a brand value rated at between $3.4 billion and $4.7 billion. Although Brand Finance estimates that the value of each company in the top 10 has risen between 2017 and the current year, seventh-placed Rolls-Royce and ninth-placed Raytheon have slipped in the ranking.
Within the top 10, aero engines to landing gear manufacturer Safran is the biggest riser, up by one-third on its 2017 value, with Brand Finance attributing some of that to the completion of its acquisition of fellow French company Zodiac Aerospace. The merger, says the consultancy, has created the world’s third-largest first-tier supplier, and is likely to drive substantial revenue growth in coming years feeding through to a "significant increase" in its 2018 brand value.
Every year, Brand Finance values the 25 biggest brands across several industries, including aerospace and defence. Its values are based on an estimate of what a brand owner would collect by licensing the brand on the open market. The consultancy takes into account a number of factors, such as marketing investment, stakeholder equity, and business performance, to judge what proportion of a business's revenue is down to the brand.
Outside the top 10, Rockwell Collins has seen its value soar by the most, ironic as its brand is soon to be subsumed into a new Collins Aerospace Systems unit after its takeover by United Technologies. The US company jumps from 19th in 2017 to 13th this year, with a brand value of $1.8 billion, a rise of 112%. The brand has had "an extremely strong year" with revenues increasing to a record $6.8 billion and a major acquisition with B/E Aerospace. The new ownership by United Technologies – itself up 14% to $3.4 billion brand value – "is bound to have an even more transformative impact on the brand", says the consultancy.
There are three new entrants in the Top 25, two of them from outside the main aerospace manufacturing territories of Europe and North America. These are AviChina – a holding company with a variety of aerospace interests and the first Chinese entrant in the ranking – which is placed 20th with a brand value of $933 million; Rheinmetall, the German metals and aerostructures supplier, in 22nd with a value of $862 million; and 25th-placed United Aircraft of Russia, with an estimated value of $669 million.
Only one company in the Top 25 has seen its brand value fall over the year: Italian group Leonardo, with a drop of 2% to give it a value of $1.69 billion. That may be partly a result of the extensive rebrand the company carried out in 2016, abandoning traditional trading names such as Alenia and AgustaWestland, and even its own former brand, Finmeccanica, in favour of a new divisional structure with everything from helicopters to training aircraft to defence electronics carrying the Leonardo label.
Brand Finance says brands in the sector grew an average of 22% over the year, faster than in the other industries it surveys. "This was a great year for aerospace and defence brands, with a strong commercial jet market and increased planned defence spending in both the USA and globally," says director Savio D’Souza. "The brands are growing bigger and are building up capacity for expansion, as in the case with UTC taking over Rockwell Collins and with Boeing's new deal with Embraer. Across the sector, we have seen steady growth, yet the balance of power remains very much the same as few brands in the league table change ranks."
Over the six years Brand Finance has carried out the research, Boeing has been the biggest beneficiary of the largest companies in the survey, seeing its value more than double from under $10 billion in 2012. Airbus has seen its brand value drop from a peak of around $15 billion in 2014. Lockheed Martin's brand value has also more than doubled from less than $3 billion in 2012, while General Dynamics and Northrop Grumman have experienced more modest growth.