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Recent Trends in U.S. Aeronautics Research and Technology Appendix A Additional Factors Influencing the Committee’s Findings and Recommendations IMPACT OF AERONAUTICS ON NATIONAL SECURITY History since World War I has demonstrated that a superior aeronautical capability is usually determinative in military operations, and it will be the key to our ability to wage future wars, large or small. Advanced aeronautical systems will enable us to achieve our military objectives while minimizing American casualties. Surface forces, including civilians, cannot be secure without “control of the skies.” Friendly bases will not always exist and prepositioned forces will not always be in place. A quick response to distant points of conflict requires air transportation. Knowing where the enemy is and knowing his capabilities are crucial to successful war fighting. Airborne reconnaissance and intelligence operations continue to be essential capabilities of air power, even in the presence of improving space assets. The disruption of enemy supply lines and communications, antitank and antiartillery actions, and attacks on enemy fortifications are all critical to military operations. Search, rescue, and rapid movement of wounded to hospitals are also tremendously important airborne capabilities, not only because of the lives saved—the overriding consideration—but also because of the effect on the morale of those who must go in harm’s way. IMPACT OF AERONAUTICS ON THE NATIONAL ECONOMY In earlier sections of this report economic factors were cited as evidence of the importance of aeronautics to the nation. The contribution, however, of the aeronautics industry to the gross domestic product (GDP) may be the best measure of an industry’s importance to the economy. Broadly defined, the U.S. aviation industry contributes approximately $436 billion per year of total output (direct and indirect) to the U.S. economy (Table 1). The net contribution to GDP has been estimated to be $259 billion, or 3 percent, of GDP. In addition, as an employer, the combined aeronautics and space industry, which are inseparable in terms of fundamental disciplines, have significant research related employment in manufacturing, maintenance, and repair services throughout the United States.
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Recent Trends in U.S. Aeronautics Research and Technology TABLE 1 Economic Impact of the Aeronautics Industry, 1999 Total Output Contribution to GDP* Air transportation (including air freight) $205 billion $80 billion Aircraft manufacturing $134 billion $94 billion Tourism $94 billion $85 billion Travel agents/freight forwarders $3 billion N/C Government $2 billion N/C Total $438 billion $259 billion N/C=Not Calculated. *Induced economic impacts are not included in the reported results. The difference between total output and the contribution to GDP is inter-industry transactions. Source: L.Anderson, NASA Glenn Research Center presentation to the NRC, “Impact of Aviation on the Economy,” June 1999. IMPACT OF AERONAUTICS ON THE QUALITY OF LIFE As a means of travel, flight may appear as just one more step in an evolution that progressed from foot, to the use of animals, boats, ships, railroads, and automobiles, and, finally, aircraft and spacecraft. But because of the increases in speed aircraft have made possible, the effect of that speed on economic productivity and the accessibility of long-distance travel have made the effect of air travel on the quality of life more revolutionary than evolutionary. As one result, tourism is now the world’s biggest business. More people travel over large distances to vacation than ever before. And for people who must travel, air travel has effectively increased their life span by reducing the time spent traveling. In the mid-1990s, roughly 6,000 commercial air carrier aircraft, large and small, were in use, along with about 115,000 general aviation aircraft, mostly for “personal” use rather than as “executive” business aircraft.1 See Figure 11 is an indication of how many people fly commercially, for business and pleasure. These aspects of aeronautics profoundly affect the quality of life for U.S. citizens. Noise and noxious effluents from aircraft engines, along with the noise produced aeroacoustically by rotors, propellers, and the turbulence of landing gear wheel wells during takeoff and landing, are environmental aspects exacerbated by the exponential growth of aircraft operations taking place in the United States and worldwide. Adverse effects around airports have already been responsible for retiring certain older transport aircraft and requiring the re-engining of others. For those who live and work in the vicinity of airports, the effect of aircraft on the environment will certainly influence both the convenience and economics of their businesses and the general quality of their lives. Aeronautics R&T can reduce the environmental impact on the air-side operations at airports; in the long term, a short-haul civil tilt-rotor operating from satellite airports has the potential to improve the ground-side environment. GLOBALIZATION The globalization of the aeronautics industry has been increasing steadily. Cross-border relationships are driven by (1) the need for capital formation; (2) access to markets; and (3) synergies created by specific combinations of corporate strengths. In the propulsion sector, 1 Aerospace Industries Association of America (AIA). 1994. Aerospace Facts and Figures 1993–94. Washington, D.C.: AIA.
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Recent Trends in U.S. Aeronautics Research and Technology Figure 11 Percentage of the U.S. population that has flown commercially. Source: Air Transport Association of America, Air Travel Survey 1998 Note: Survey Size=3,016
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Recent Trends in U.S. Aeronautics Research and Technology for instance, cross-border relationships include a risk and revenue-sharing partnership between Pratt and Whitney and MTU2 (Germany); CFM International, which is a joint venture between General Electric Aircraft Engines and Snecma (France); and the ownership of Allison by Rolls-Royce (Great Britain). In each of these cooperative ventures, the U.S. component of the relationship had to “win” its position in the partnership by having the capability to bring state-of-the-art technology to the program and to perform competitively. NASA and Department of Defense aeronautics R&T have helped U.S. companies develop state-of-the-art technologies and, in so doing, have helped create high-quality U.S. jobs, contributed to a positive balance of trade, and have created other economic benefits in the aerospace sector of the economy. This is a positive outcome of aeronautics R&T that should receive continuing recognition on the part of funding agencies. IMPACT OF INDUSTRY CONSOLIDATION The U.S. aerospace industry has been changed markedly in this decade by mergers of both major defense contractors and large commercial transport manufacturers. These mergers have been driven by the reduced defense market, the need to reduce the cost of products by eliminating duplicated overhead functions (e.g., payroll, purchasing, contracts) and underused manufacturing facilities, and the increased cost and complexity of commercial and military aircraft, including the integration of related systems (e.g., avionics). This consolidation of manufacturing companies appears to arouse congressional resistance to the use of government funds to support aeronautics R&T, which opponents sometimes label as “corporate welfare.” In fact, the global competition in aircraft markets precludes any claim that the large commercial transport industry is monopolistic. For example, the competition to the Boeing Company is supplied by Airbus Industries, which develops technically advanced and competitive jet transports with the help of the governments of England, France, Germany and Spain. The Eurofighter program is another example of joint multi-government/industry cooperation to achieve technical excellence and competencies. Further, the total number of wage earners adversely affected by the industry consolidation process is not nearly as large as the changes in company names suggest. Lockheed Martin, for example, still has a division in Fort Worth, Texas (formerly part of General Dynamics), the Skunk Works in Palmdale, California, and a division in Marietta, Georgia (formerly Lockheed). The Boeing Company still operates the military projects division and Phantom Works in St. Louis and a transport division in Long Beach, California (all three formerly McDonnell Douglas), in addition to its operations in Seattle, Washington, and Wichita, Kansas. The Boeing Company also has helicopter development divisions in both Philadelphia, Pennsylvania and Mesa, Arizona (formerly McDonnell Douglas). As the market for aircraft and missiles shrinks the associated work force will shrink. Further, consolidation has reduced the number of organizational entities available to support aeronautics R&T. AERONAUTICS AS A “MATURE INDUSTRY” The aeronautics industry, particularly the civil aeronautics industry, is frequently described as a “mature industry,” implying that it is characterized by diminishing technological opportunities and low returns on R&T investment. Although there are significant exceptions, most of the economic activity in aeronautics is conducted by large, well-established, “mature” companies. However, aeronautics technology is far from mature, if mature means there is limited opportunity 2 Motoren- und Turbinen-Union GmbH.
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Recent Trends in U.S. Aeronautics Research and Technology for growth. Technological advances continue to produce important improvements in performance and affordability, even if those advances are not readily visible to the eye. For example, the C-17, C-141, and C-5 look very similar, but the advanced technologies incorporated in the structures and systems of the C-17 contribute to capabilities and operational performance unmatched by the older C-141 and C-5 (Figure 12). Aeronautics technology tends to be limited by ideas, not by basic physics. In the past, the U.S. aeronautics program has generated technical opportunities; with stabilized funding, the NASA and DOD aeronautics R&T program could be structured to continue generating technical opportunities. Aeronautics R&T has many areas of great opportunity reflecting its R&T-intensive nature and use of inputs from other R&T-intensive industries. The application of information technology to aircraft controls, guidance and navigation, traffic management, and propulsion is only one example. The use of advanced metallic and composite materials is another. The industry also faces ample opportunities for far-reaching innovations in production management and methods. Like the pharmaceuticals industry, the top tier of firms in aeronautics is complemented by a very large number of smaller supplier firms, many of which are relatively recent entrants to the industry. In at least some supplier sectors, such as avionics, significant entry by new start-up firms has occurred and is bringing innovative vitality to the industry. In short, the characterization of aeronautics as a mature industry says little if anything about the level of technological opportunities. In the judgment of this committee, there is little reason to anticipate that these opportunities will diminish in the near future. Indeed, the continued social demands for quieter, safer, and more environmentally friendly air transportation all require innovative responses.
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Recent Trends in U.S. Aeronautics Research and Technology Figure 12 On-time rate for U.S. Air Force airlift missions during the 1999 Balkan Campaign. Source: Aviation Week and Space Technology, page 19, August 9, 1999. Photos: Department of Defense.
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