2017 US Aerospace Defense Industry International Expansion

Aerospace and defense cross-border joint ventures

Cross-border A&D JVs continue to be an important vehicle for international expansion.

According to the analysis by Deloitte, Many nations are investing in science and technology and proudly tout their aerospace and defense progress. As a result, A&D companies focusing on international expansion are doing so through cross-border joint ventures (JVs) to create value.

With the US and European A&D sectors maturing, companies from these regions are increasing their focus on international growth opportunities in markets such as India, China, and the Middle East.

Over the last 10 years, commercial and military aerospace businesses in India remained the leading segments, within aerospace or defense, to establish cross-border JVs.

Similarly, China has seen cross-border JVs in the commercial aerospace segment, followed by commercial avionics.

The Middle East has experienced large numbers of JVs in commercial aerospace, as well as weapons-related JV formations. Going forward, India, China, and the Middle East will likely lead the way in attracting JV activity, with other geographical regions following (Eastern Europe, Southeast Asia, etc.).

With India relaxing its defense sub-sector foreign direct investment (FDI) rules, entering into its A&D market is now easier. This change in policy positions the world’s biggest defense importer to become a key aerospace and defense manufacturing hub.

In the Middle East, oil price volatility, regional tensions, and the recognition of the multiplier effect of an A&D sector base are collectively expected to drive JV formation activities. China continues to make impressive progress in building a formidable A&D industrial base.

However, A&D companies and their executives need to keep key issues in mind while entering into international JVs, including geopolitical alliances, end markets, supply chains, and regulatory compliance and structure.

Report highlights include:

  • Lists of cross-border joint ventures in aerospace and defense, by region
  • Public policy developments and emerging trends
  • Offset frameworks and intellectual property rights rules by market
  • India and China lead the pack, followed by the Middle East, in cross-border joint venture activity
  • Cross-border joint venture activity trends by A&D segment: Commercial and military aerospace remain focus areas
  • How can joint ventures plan for complexity and success?

You can find the full report here below.

Source: Aerospace and defense cross-border joint ventures

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The New Era of Innovative Disruption in Aerospace and Defense

Why do so many aerospace and defense (A&D) companies “stay the course”?

Why do so many aerospace and defense (A&D) companies “stay the course” when faced with disruption, sticking with strategies and business models designed for a different era? New Deloitte research found that A&D companies that adapted their strategies and business models significantly outperformed those that didn’t.

 Shifts in demand trigger new eras

Why should A&D company executives who have traditionally “stayed the course” consider changing strategies and business models now? Because today’s convergence of disruptive factors will fundamentally change the way the A&D industry is structured, operates, and performs. Sticking with the status quo—or just making small adjustments—won’t be enough to maintain market leadership in the next era of A&D.

To outperform the industry, A&D company executives should take bold steps. In our experience, many companies hesitate to launch new strategies because they lack a systematic set of defined alternatives. This report outlines alternatives to consider, ranging from the most passive (e.g., stay the course) to the more active (e.g., restructure portfolio). Our findings suggest that companies choose a strategy that actively creates value.

Business Strategy in Aerospace and Defense

Time to outperform the industry

The bottom line is that the inevitable march of commoditization has finally arrived on portions of the A&D market’s doorstep. It’s changing the fundamental basis of competition in the industry and shaking the foundation on which many companies have based their strategies. Staying the course isn’t an option.

Companies that embrace the fundamental disruption in the market have an opportunity to gain market leadership. By rethinking their strategies and business models, they can improve financial performance and outperform the A&D industry over the next decade.

Trends in Aerospace and Defense Mergers and Acquisitions

A healthy Aerospace and Defense M&A market

The evolving focus of Aerospace and Defense M&A

According to the study by Deloitte ,in the aerospace and defense industry, mergers and acquisitions (M&A) as we know them have recently changed. Instead of megamergers for the purpose of cost savings and synergies, current aerospace and defense M&A activity focuses on acquisitions that deliver new products and offer expansion into markets such as Asia, the Middle East, and beyond.

Key Findings.

  • Near-term aerospace and defense M&A is likely to focus on growth.
  • Megamergers are likely to decrease in frequency while acquisitions of smaller targets could increase.
  • Acquisitions will be used to gain new capabilities, access emerging technologies, and geographic expansion.
  • Joint ventures and partnerships could replace outright mergers and acquisitions in some instances.

Source: Trends in aerospace and defense mergers and acquisitions

Keeping Pace with The Complex Global #Manufacturing Environment

 

2016 Global #Aerospace and #Defense Sector Outlook

 

3 Steps to Be A High-Performing #Manufacturer

#Positioning  #Differentiation  #Defining characteristics

  • How competitive are your capabilities today?
  • How important are they for your future?
  • Are your competitive capabilities or future priorities any different than your competitors’?
  • Do your capabilities cluster to define unique competitive characteristics?

Here below the answers:

#Digitaltransformation: A View Across Industries

A digitalization case from #Airlines industry and how #Aerospace manufacturing industry can benefit from #digitalization.

#InformationManagement Insight by Meade Monger.