The Russians Are Coming! Oh, Wait…Not Yet…But Soon!

So, at the end of last week, the idea that Boeing was going to be sole bidder on the Air Force aerial refueling tanker “took a nose dive.” (Sorry, I couldn’t resist.) EADS talked about applying on their own without an American partner, the Air Force said that they’d extend the deadline to accommodate EADS doing so, and then a rumor broke out that the Russian aerospace company United Aircraft would be applying too. Apparently, at least that last one isn’t true, but it is still a sign of the times to come.

Like so many other things in the world, we often like to think of everything as a choice between two extremes: U.S. vs. U.S.S.R., Magic vs. Bird, Boeing vs. EADS. But the world is a complicated place, and one thing I know about economics is that market opportunity breeds competition; that is to say, the aerospace market is full of opportunity, and there are a lot of competitors trying to get into the market. Russia’s United Aircraft is just one of the many countries – not to mention China, Canada and Brazil – moving into this space. For now, they are nibbling around the edges, but someday in the not too distant future it won’t just be a choice between the A380 and the 787.

Now, this isn’t necessarily a bad thing, particularly for our region. First off, competition can spur innovation and force companies to remain nimble and responsive. Second, and more important, is that a majority of our state’s 600 aerospace companies are suppliers who have increasing networks of customers around the world. More airplane manufacturers/assemblers means more customers for our local companies. And we’re well positioned geographically to reach many of them relatively easily. So bring on the Russians. I hope they like composite materials!


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