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US aerospace industry projects growth

Posted on Dec 06, 12:45PM | IANS

US aerospace and defence industry sales will keep growing throughout the next year despite the looming defence spending cuts, a leading industry trade group said. The total sales of the US aerospace and defence industry are projected to increase by 3.4 percent from nearly USD211 billion in 2011 to nearly USD218 billion this year, the Aerospace Industries Association estimated.

The group also predicted that the sales of the industry would rise by 2.6 percent to nearly USD224 billion in the coming 2013, without taking into account the nearly USD55 billion cuts in defence expenditure set to take place next year if the Democrats and the Republicans fail to reach a deal, reported Xinhua.

The industry's positive trade balance rose USD7.7 billion to an estimated USD63.5 billion in 2012, making the largest trade surplus among the country's manufacturing industries.

The growth is largely due to strong civil aircraft sales, said Marion Blakey, the group's president and CEO, at a year-end industry luncheon Wednesday.

The industry has seen a "healthy expansion" in exports, increasing over USD10 billion to an estimated USD95.5 billion in 2012 over the previous year, said the group.

Blakey also said it was extremely difficult to forecast next year's outlook for the aerospace and defence industry, given the potential fiscal cliff.

The ongoing debate over the fiscal cliff refers to the automatic spending cuts and tax increases that will take effect Jan 1 unless US President Barack Obama and the Congressional Republicans come up with a compromise.

The trade group has lobbied hard to stop the across-the-board defence cuts, known as sequestration. Congressional Democrats and Republicans generally agree the defence spending cuts should be avoided, but they disagree on how to achieve that goal.