By the BF Staff
From the January/February 2018 Issue
Due in part to the size of its domestic market and increased U.S. defense spending, America comprises by far, the largest market for defense equipment, systems and services in the world.
Industry analysts say factors like the growing international market for weapons (with more developing nations expanding their defense spending and conflicts breaking out in more countries), the advent of innovative technologies in warfare and the increasing demand for cost-efficient production are driving revenue growth in the U.S. Aerospace and Defense industry.
The sector also is benefiting from a stable domestic economic environment, with the U.S. economy achieving GDP growth in excess of three percent in the last three quarters (GDP increased at an annual rate of 3.2 percent in the third quarter of 2017 and exceeded that in the fourth quarter, according to estimates by the federal Bureau of Economic Analysis). This has set the stage for more upsides in the aerospace-defense industry, since a strong economy can better support defense funding. But a decline in skilled workforce and increasing competition with emerging nations vigorously engaged in expanding their own defense production remain a challenge for U.S. aerospace/defense manufacturers. However, its non-cyclical nature always has helped this industry overcome the peaks and valleys of the global economy.
AERO SECTOR SOARS IN GREATER FORT LAUDERDALE
While Greater Fort Lauderdale may be internationally recognized for its sandy beaches and sunny weather, industry insiders know the region as an aviation hub with a deep talent pool and rich history. As the former home of Pan Am and Eastern Airlines, South Florida benefits from the large, skilled work force that these early pioneers left behind.
Home to nearly 50,000 aviation workers and 10 airports (three international and seven private), South Florida is a natural setting for aviation and aerospace companies, a $41 billion sector for the region. In fact, PwC has ranked the state of Florida as first in the nation for aerospace manufacturing attractiveness and second for housing the largest number of aviation and aerospace establishments.
From maintenance and repair, to training and manufacturing, Greater Fort Lauderdale has become a hotbed for the aviation industry—an economic engine that supports more than 135,000 jobs annually.
Outlined below are a few reasons why Greater Fort Lauderdale offers a unique competitive advantage to the aerospace companies that choose to operate out of the region.
Greater Fort Lauderdale/Broward County has spent years building the foundation necessary to put aviation and aerospace companies on a path for continued growth. With nearly 2 million residents, Greater Fort Lauderdale has a vibrant population (median age, 40), affordable housing (median property value of $242,400 according to Zillow), a rapidly expanding transit system and an array of higher-ed resources.
When looking to establish a base, aviation and aerospace companies must consider all that the surrounding area offers in terms of business amenities and transit infrastructure.
Brightline, America’s first new private rail service in over a century, is set to be fully operational in Q1 2018. The train will run daily commuter lines between Fort Lauderdale, Miami and West Palm Beach. Brightline is paving the way to a more urban, vertical and connected future for the region and opening up the South Florida corridor in terms of talent recruitment and business collaboration.
The Fort Lauderdale-Hollywood International Airport (FLL), which has an annual economic impact of $13.2 billion, has seen double-digit international growth for more than three years now. FLL is in the midst of a $333 million expansion project that includes a new international concourse. Fort Lauderdale Executive Airport (FXE) handles more than 165,000 takeoffs and landings per year, making it one of the busiest general aviation airports in the U.S. Other major international airports in West Palm Beach and Miami are both less than an hour’s drive away.
Port Everglades received approval this past May to initiate its largest expansion project to date, a $437.5-million improvement effort that will add new berths for larger cargo ships and install crane rail infrastructure to accommodate new Super Post-Panamax cranes. Broward’s port already serves as the region’s gateway to Latin America, the Caribbean, Europe and Asia.
Greater Fort Lauderdale boasts an impressive roster of aviation and aerospace companies ranging from freshly funded startups to global heavy weights.
JetSmarter, dubbed “the Uber of the sky”, was founded in downtown Fort Lauderdale in 2012. Since then the fast-growing private jet startup has secured more than $105 million in funding, including backing from Jay-Z. The company’s CEO, Sergey Petrossov credits Broward County, commonly referred to as the private jet capital of the world, for introducing him to aviation.
Tropic Ocean Airways, the leading seaplane operator on the East Coast, recently announced that it will create 100 new jobs in Broward County as the company closed on a major round of capital and expanded its fleet operating out of Fort Lauderdale. Tropic Air has partnered with Broward College to continually inject new talent into the company.
HEICO Corp., currently valued at $6.5 billion, has been based out of Hollywood, Florida since 1990. The company designs, produces, repairs and distributes products and services to niche segments within a number of industries, in addition to reverse engineering state-of-the-art hardware for its clientele. HEICO customers range from major commercial airlines to military agencies worldwide.
Two of the country’s leading airlines also have significant expansions underway in Greater Fort Lauderdale. Spirit Airlines is currently looking to grow its Miramar-based headquarters while JetBlue is pursuing an aggressive, long-term expansion at Fort Lauderdale-Hollywood International Airport(FLL). Additionally, Emirates Airlines recently added round-trip non-stop service from FLL to Dubai.
Additional leading aviation companies based out of Greater Fort Lauderdale include 1st Choice Aerospace, Banyan Air, CTS Jet Engines, Embraer, GA Telesis, JetScape, Kellstrom Defense Aerospace, Lufthansa Technik, National Jets, Private Jet Charter, Propulsion Technologies International, Sheltair and Turbine Controls, Inc.
Operating within close proximity of like-minded organizations is an important catalyst for growth among aviation and aerospace companies as they benefit from the value chain that exists within a cluster. This includes parts suppliers, manufacturers, repair facilities, academic institutions, workforce training and allied industries such as banking and insurance.
With more than 35 colleges and universities in the region, South Florida provides a pipeline for aviation companies to scout the next generation of pilots, engineers, mechanics and more.
Broward College and Diversified Companies is building a new aviation facility at the North Perry Airport in Pembroke Pines. When complete, the new facility will have 91 hangars, an exclusive pilots’ lounge and a home for the expansion of Broward College’s Aviation Institute. Three hangars will house four classrooms, faculty offices and shop space as part of the College’s Aviation Maintenance Management Associate of Science program. Broward College also has launched a Bachelor’s of Science degree in aerospace sciences.
MILLENNIALS FLOCK TO ROCHESTER, NH
Millennials are now the largest generation in the United States—83.1 million versus 75.4 million Baby Boomers, according to the U.S, Census Bureau. The Pew Research Center reports that one in three workers is a Millennial and many manufacturers believe that this shift will change manufacturing for the better. In a research study conducted by IndustryWeek earlier this year and sponsored by Emerson, manufacturing respondents said the industrial IoT will improve operations through real-time access to information and more tightly connected supply chains, but they pointed to personnel as the most important factor for success (IndustryWeek, Dec. 28, 2017).
To attract talent from this tech-savvy cohort, the Advanced Technology and Academic Center (ATAC) of Great Bay Community College successfully connects Millennials with innovative and “cool” careers in advanced technology and composite materials used in aerospace applications. The award winning ATAC celebrates five years of providing 27,000 square feet of state of the art classrooms, computer simulators and technology laboratories. Hundreds have graduated in the past few years, finding careers at Albany Engineered Composites (Albany International) and Safran Aerospace Composites (Safran USA), and other regional aerospace and composites manufacturers
Albany and Safran have co-located a 345,000-square-foot manufacturing facility in Rochester to maximize access to this rich talent pool and specialize in manufacturing components for the LEAP engine manufactured by CFM. Major applications for the LEAP engine are the Airbus A320neo family, the Boeing 737MAX and the Comac C919. The LEAP’s fan blades are manufactured from 3D woven RTM (Resin Transfer Molding) carbon fiber composite. This engine delivers a 15 percent improvement in fuel consumption compared to today’s best engines. Both Airbus and Boeing selected Rochester, NH for the LEAP facility in 2013.
Some successful, growing companies worry that millennials will not be attracted to manufacturing. As much as 84 percent of executives agree that there is a talent shortage in U.S. manufacturing, according to a survey by the Manufacturing Institute and Deloitte. Millennials are looking for manufacturing organizations that value their feedback, opinions and their process improvement recommendations. Millennials will bring their openness to innovation and challenge accepted practices and processes, leading the charge for change in manufacturing (one example: supply chains rapidly are becoming more digitized).
Rochester also has prepared for the industrial IoT (Internet of Things) as well as a tightly connected supply chain in composites and aerospace manufacturing. The Rochester School System has integrated the pathways from the Rochester Middle School, Spaulding High School and the Creteau Technology Center with Great Bay’s ATAC. This integration provides rich opportunities for hands on learning, tours and interactions at leading aerospace facilities, and priority placement in the ATAC’s curriculum for graduating Seniors. One initiative currently under development would allow Spaulding students the opportunity to attend ATAC while receiving dual high school and college credit, and shortening the timeline from school to career. The Creteau Technology Center will begin a comprehensive upgrading of their facilities and equipment beginning in 2018, with the City and State of NH investing $16.5 million.
The City has also expanded the Granite State Business Park at Innovation Drive, adding 100 acres of prime real estate. This opens up new opportunity for the supply chain firms who benefit from proximity to ATAC as well as the region’s cluster of composite material manufacturers and aerospace firms. This land is City-owned and will be sold at cost to companies who choose to locate in the park that has access to the Spaulding Turnpike and Interstate 95, rail and air charter access, broadband, natural gas, 3-Phase redundant power and abundant water and sewer capacity. Interested parties should contact Rochester Economic Development and visit www.RochesterEDC.com.
A BUSINESS OASIS IN THE DESERT
“If you’re looking for a great place to live and work in Arizona, you can’t do any better than Goodyear.” Goodyear, AZ is the nucleus of aerospace growth and opportunity in the West and has been a leader in the industry for 75 years. Renowned aviation companies like AerSale, Lockheed Martin and Airline Training Center Arizona call Goodyear home; these and other aviation businesses benefit from a plethora of advantages the city possesses. The only Military Reuse Zone in West Metro Phoenix is in Goodyear plus the city has multiple Foreign Trade Zone sites. Both mean tax benefits and a more affordable place to do business.
With a location just 30 minutes from the most innovative school in the nation (ASU) that contributes to the third largest labor pool in the West (1.56 million), aerospace and aviation outfits are able to draw talent from an abundance of educated, highly skilled and eager graduates who want to make Goodyear and Greater Phoenix a great place to work, live and thrive. And that’s exactly the story today. Recent graduates and longtime residents alike agree that Goodyear is the place to be—93% of Goodyear citizens rated it as a good or excellent place to live. 300 days of sunshine, scenic mountain views, golf courses, lakes, parks and an assortment of cultural, educational and entertainment resources are the culprits behind the city’s “A” rating.
The Phoenix-Goodyear Airport (GYR) Aviation & Aerospace Employment Corridor is a fundamental asset to the city of Goodyear. It not only meets but exceeds the growing demand for corporate jet service and storage in the West Phoenix region, and boasts one of the largest independent maintenance, repair and overhaul (MRO) companies in Arizona. In close proximity to the airport is a bounty of available land and 16 industrial and business parks suitable for the most sophisticated aviation operation. The Phoenix-Goodyear Airport has the largest economic impact—$121.3 million—of any airport in West Metro Phoenix.
Why Goodyear? Goodyear, AZ is synonymous with growth and opportunity. It’s one of the fastest growing cities in the U.S., enjoys a median household income that’s nearly $74,000/year and maintains a world-class healthcare corridor anchored by Abrazo West Campus and Cancer Treatment Centers of America. Its vast accessibility and transportation connections via I-10 and Loop 303 make it a sought after place to do business in Greater Phoenix, and it’s already home to major employers like Amazon, REI, Macy’s, Sub-Zero, Huhtamaki and Ball Corporation. With more than 4,000 acres of land available for development, a business friendly environment that offers enhanced permitting and minimal regulations, affordable housing options and an excellent quality of life, it’s no surprise that businesses in aerospace and aviation are choosing Goodyear, a city poised for banner achievements and industry success. Propelling Opportunity. Powering Connections. That’s Goodyear, AZ.
FLORIDA: NEXT STAGE OF AEROSPACE
Are you reading this story on a mobile device? Have you checked tomorrow’s weather or recently navigated to a meeting using your cell phone? Odds are you used a satellite launched from Florida to get that information. For more than 65 years, when people talk rocket science, they’re talking about Florida. Aerospace activity continues to grow across the state: Cape Canaveral and Florida’s Space Coast are as active as ever, with government and private companies building, assembling and lifting off from several historic launch pads. So far this year, both the United Launch Alliance (ULA) and SpaceX have successfully launched from Florida.
Nearly 25 launches are planned through the end of 2017, including missions from the U.S. Navy, Orbital ATK and more launches of ULA’s Atlas and Delta vehicles, as well as the SpaceX Falcon 9 and Falcon Heavy. Frank DiBello, the president and CEO of Space Florida, the state agency dedicated to strengthening the state’s position as the global leader in aerospace research, investment, exploration and commerce, has watched the industry’s exponential growth. “Our state’s iconic space legacy is ever-expanding, and commercial companies play a key role in both the aerospace and satellite industry here in Florida,” said DiBello.
Last spring, DiBello and Space Florida were there when OneWeb, a global communications network company, announced it would build a 100,000-square-foot satellite manufacturing facility just south of Kennedy Space Center. The project will create 250 high-tech manufacturing and engineering jobs and an $85 million investment.
OneWeb will design, build and launch an extensive network of small, low earth orbit satellites that will enable the delivery of low-cost Internet services worldwide. These micro satellites will be mass produced at the Space Coast facility utilizing fewer components, thus making them lighter and easier to launch.
OneWeb CEO Brian Holz said, “Florida is an excellent location for our high-volume satellite manufacturing facility. The State of Florida and Space Florida really understood our business needs and gave us an outstanding offer to locate in Exploration Park. Our high-volume satellite production uses many of the same technologies as aircraft production and Florida has become a center of excellence for both aviation and space related technologies. We will leverage much of the local aerospace capability expanding opportunity in the Space Coast region, and we also anticipate many of our suppliers to co-locate operations near our facility.”
While Cape Canaveral holds the history of spaceflight, the aerospace industry has grown statewide.
Last year, GKN Aerospace announced they will open their first Florida location. The company will locate a new manufacturing facility in Bay County, creating 170 jobs and investing more than $50 million. GKN Aerospace uses advanced manufacturing technologies to supply high-value, integrated assemblies in both metallic and composite materials to the aviation industry. The company is one of the world’s largest suppliers to the international aviation industry.
Mike Grunza, CEO of GKN Aerospace’s Aerostructures North America business said, “This investment emphasizes our commitment to manufacturing in North America, as this new world-class facility will create jobs and strengthen our competitive position in the U.S. aerospace market for the future. The excellent support we have received from Bay County EDA, Gov. Rick Scott’s office, higher educational partners and The St. Joe Company made Florida an ideal location for GKN.”
Back on the Space Coast, work is well underway at Blue Origin’s 750,000-square-foot New Glenn rocket-building facility. Blue Origin selected Florida for its Orbital Launch Vehicle manufacturing, launch and support facilities. The project will create 330 jobs and a capital investment of $200 million.
“Cape Canaveral has long been a gateway to humankind’s greatest adventures. Our new home—Complex 36—has seen 43 years of service and 145 launches.,” said Amazon CEO Jeff Bezos. “This historic pad hasn’t seen a rocket launch in more than 10 years—too long—we can’t wait to fix that.”
In addition to ULA, SpaceX, Orbital ATK, OneWeb, GKN and Blue Origin, global industry leaders like Boeing, Lockheed Martin, Northrop Grumman, Safran and Thales all have operations across Florida.
SIERRA VISTA, AZ: PRIME TEST LOCATION
Nestled in the foothills of the towering Huachuca Mountains, Sierra Vista is home to the U.S. Army’s Fort Huachuca, which trains and supports tech-heavy aviation programs, attracting engineers, manufacturers and operators to this southeastern Arizona community.
The open skies, high altitude and phenomenal flying weather create a superb combination for the Army’s diverse missions as well as private operations.
A Critical Role in National Defense. The City of Sierra Vista and the U.S. Army entered into an agreement to create a joint-use airport benefitting the Army and local community. The municipal airport, adjacent to Libby Army Airfield, is managed and operated by the City, while air traffic control is conducted by Fort Huachuca, managing as many as 135,000 air missions annually. This partnership has allowed Sierra Vista to support Fort Huachuca’s missions and offer a slate of general aviation services unavailable anywhere else in the United States.
The 12,001-foot runway, along with the 964 square miles of restricted airspace and high elevation, enables unique training and testing to occur in this relatively quiet community. The airfield services military aircraft, including the U.S. Army’s MQ-1C Gray Eagle to the Air Force’s F-16 Falcon, A-10 Warthog aircraft and even the Missouri Air National Guard’s C-130 Hercules transport aircraft.
“Fort Huachuca plays a critical role in national defense,” says Tony Boone, economic development manager for the City of Sierra Vista. Formerly stationed at Fort Huachuca, Boone, a retired colonel, has his fingers on the pulse of Sierra Vista and the symbiotic relationship it has with the Fort. “Because of its close relationship with Fort Huachuca, Sierra Vista is home to myriad contractors specializing in aerospace and technology to support the Fort’s missions.”
Local educational opportunities also add to the tech-savvy workforce, including the University of Arizona Sierra Vista, which recently launched one of the top cyber security programs in the nation, and Embry-Riddle Aeronautical University, strategically located on Fort Huachuca.
The Army’s diverse missions at Fort Huachuca include training Unmanned Aircraft Systems (UAS) and Special Electronic Mission Aircraft (SEMA) and testing advanced systems like the Enhanced Medium Altitude Reconnaissance and Surveillance Systems (EMARSS) at the Electronic Proving Ground, as well as pilot training for Air National Guard F-16 variants, the 355th Operations Group A-10s, Air National Guard Aviation Regiment Launch and Recovery site for Predator aircraft, and Joint Users Interoperability Communications Exercise.
Tucked in between all of the military flights, general aviators and federal agencies also operate, fly, and train in Sierra Vista’s airspace.
The joint-use airport is used by the U.S. Forest Service as a base for both command and control for wildland fire-fighting aircraft, as well as their fixed-wing and rotary air tankers. Throughout the year, the facility also is used by the U.S. Border Patrol for rotary and unmanned aircraft to defend the nation’s southern border.
Partnering with Marine Corps Air Station Yuma, located in western Arizona, Fort Huachuca stages semi-annual airfield seizure training exercises to maintain the Marines’ military readiness.
Committed to environmental stewardship, the City of Sierra Vista was named the nation’s first EPA WaterSense Community, thanks to its smart water use standards, and has partnered with many organizations to ensure that natural resource preservation, conservation and education remain a top priority for the region. These efforts ensure the quality of life for future generations.
Sierra Vista is a Great American Defense Community and has received a DOD grant that has been utilized to evaluate the potential municipal side of the airport, which has adjacent available property, available hangar space and proximity to Interstate 10.
More information about Sierra Vista can be found at www.SierraVistaAZBusiness.com.