Companies in this industry manufacture aircraft engines and engine parts, as well as fuselage, propeller and rotor, landing gear, electric and hydraulic control, and avionic systems. Major companies include GE Aviation and Pratt & Whitney (US); Kawasaki Heavy Industries (Japan); Rolls-Royce (UK); and SAFRAN, Thales, and Zodiac (France).
In addition to the US, Canada, France, Japan, and the UK are all major sources of aircraft parts. The industry is dominated by large players that typically maintain manufacturing operations around the world. Demand for aircraft parts is driven by new orders for commercial, military, and general aviation aircraft, as well as maintenance, repair, and overhaul (MRO) services.
The US aircraft engine and parts manufacturing industry includes about 1,100 companies with combined annual revenue of about $82 billion.
Demand for commercial, military, and private airplanes drives the aircraft parts industry. The profitability of individual companies depends on efficient operations and the ability to secure long-term contracts. Large companies have economies of scale in production and purchasing. Small companies can compete by specializing in high-end, low-volume, or hard-to-find parts, or in production of low-price commodity parts. The industry is highly concentrated: the 50 largest US makers of engines and engine parts account for about 95% of segment revenue; the 50 largest US makers of other aircraft parts and equipment account for about 85% of revenue for that segment.
Exports are an important source of revenue and include replacement parts for US-made...