AEROSPACE
As Commercial Aerospace Loses Altitude, Titanium Industry Faces Difficult Questions in the Days of Covid-19 Pandemic By John Byrne
S
everal years ago during an address to the International Titanium Association (ITA) conference I said I wanted to write a book about my experiences in the titanium industry. It would be titled “Fear and Loathing on the Titanium Trail.” Capturing the complexities and characters in the titanium industry proved to be beyond my writing skills. And little did I know the craziest chapter was yet to play out… Covid-19. The emergence of Covid-19 has upended the global aerospace industry and, in turn, the titanium industry—a key part of the aerospace supply chain. Many questions exist: Where and when is the bottom? What does the recovery look like? What are the long-term impacts? What should be done moving forward? The answers, like any titanium forecast in aerospace, will be elusive and often wrong. The impact of Covid-19 on commercial airplanes production rate is far from stabilized. The original equipment manufacturers (OEM’s) have announced new production rates that are 40-percent percent lower compared with fourth quarter, 2019, production rates. The natural cycle of increasing passenger traffic, increasing utilization and profitability at the airlines, resulting in increased demand for new airplanes has been significantly 22
TITANIUMTODAY
disrupted. The International Air Transport Association (IATA) now indicates it will be 2024 until air traffic recovers, meaning a 2025 recovery
As it confronts the fallout from the global pandemic, the titanium industry must focus on two basic questions. First: Where and how can it use its influence to gain assistance from federal authorities for the aerospace industry and for member companies in the ITA? Second: What will the titanium industry have to do internally to survive and enable success in the future? of production to pre-Covid-19 rates at the earliest. The Boeing 737 MAX grounding and the production delays and disruptions from the pandemic only add to the magnitude of the commercial challenge. While positive and hopeful news about vaccines come each day, there are no guarantees, especially
in terms of a quick cure, and must be discounted when planning. We are now seeing virus infections and spikes in the United States and other parts of the world. Additional travel restrictions and quarantines are being imposed. These factors point to a deeper and longer impact than currently predicted. A downside scenario should be the baseline that the titanium industry uses for operational and sales planning. As it confronts the fallout from the global pandemic, the titanium industry must focus on two basic questions. First: Where and how can it use its influence to gain assistance from federal authorities for the aerospace industry and for member companies in the ITA? Second: What will the titanium industry have to do internally to survive and enable success in the future? The titanium industry is about melting, converting and fabricating metal for its customers of which the largest is commercial aerospace. Financial support is critical both short term and long term, but real demand for titanium is the key. The industry needs to help find a way with the federal government to accelerate the return of new demand for airplanes. While the titanium industry serves both new production and the aftermarket, the industry needs to push for a solution that prioritizes new planes over the aftermarket.
