AIA Projects Small Defense Gains in 2015

Dec. 17, 2014 - By AARON MEHTA – Defense news

WASHINGTON — Despite concerns over the Budget Control Act, the Aerospace Industries Association (AIA) projects small gains in the defense aviation market.

The gains will occur despite what AIA President and CEO Marion Blakey described at a Wednesday year-end event as a series of “unprecedented challenges” domestically and abroad.

AIA is one of the most powerful trade associations in Washington, representing both the commercial and military aviation markets.

AIA predicted a good 2014, with projected growth in nearly every defense category and a total sales growth of 5.5 percent. And the overall aviation market did indeed grow, driven largely by strong commercial sales.

But at the end of 2014, AIA numbers found military aviation sales were relatively flat, sitting at $87.3 billion. Aircraft sales increased by just 0.8 percent, or $420 million, to $52.6 billion in 2014. Sales of missiles dropped 4.1 percent, or $840 million, to $19.9 billion.

More positively, DoD space spending increased 5.5 percent, or $2.6 billion, to $48.8 billion, and there was what AIA’s annual report called “strong” growth in defense exports, to the tune of 9.2 percent.

AIA’s 2015 estimates show slight growth for all military aviation sectors for 2015, with space showing the largest projected growth, in the realm of $4 billion.

Read the full AIA report.

In her eighth year as AIA’s leader, Blakey used the luncheon event to send a warning to incoming members of Congress —as well as any potential 2016 presidential nominees — not to abandon the defense industry.

As a cudgel, AIA commissioned a Harris Poll that found 69 percent of registered voters favor increasing defense spending. That same percentage said it would be more likely to support a candidate for public office who supports increased spending on national security — something Blakey highlighted before warning those interested in running for office to “pay attention.”

At the same time, she acknowledged that “our companies did very well” in the recently passed “cromnibus” bill, adding “We’re delighted.”

Blakey also touched on a number of recent events in her speech. She responded positively to the nomination of Ash Carter to be the next secretary of defense, saying “this is gonna be good.” She also acknowledged to a questioner from the audience that Wednesday’s news that the Obama administration will seek normalized relations with Cuba could lead to more potential sales for the industry. Any Cuban sales, however, would likely come from the commercial market — at least in the near future.