Aerospace Industry Research - Materials

Part
01
of three
Part
01

Aerospace Industry Research - Carbon

While there was no information on the production demand (in tonnes) for carbon in the South Carolina aerospace industry, the research team compiled the available data to provide useful information: the growth in South Carolina's aerospace industry has facilitated the growth of existing carbon manufacturers and entry of new players. Below is an explanation of the research methodology as well as an overview of the useful findings.
  • The aerospace industry is South Carolina's fastest-growing segment with annual employment growing at 13% compared to the state's average of 2.1%.
  • The South Carolina aerospace industry currently accounts for about $24.8 billion of the state's annual output.
  • There are over 400 privately-operated aerospace companies in South Carolina creating about 55,000 jobs in the state. The boom can be attributed to Boeing's arrival in South Carolina in 2018.
  • South Carolina's revenue is growing at about 25%, on average.
  • As the aerospace industry grows in South Carolina, many aerospace suppliers are being forced to expand to satisfy the growing demand for parts.
  • South Carolina's growing aerospace industry has led to the growth of a carbon fiber cluster in the state. In 2016, carbon fiber producer Solvay expanded its footprint in the state and Toray Industries launched the construction of a $1.4 billion production plant in Spartanburg, South Carolina.
  • In 2018, Japanese carbon-fiber giant, Teijin, started work on a $600 million production facility in Greenwood, South Carolina.
  • Global carbon fiber consumption is expected to double from "60,000 metric tons in 2015 to about 150,000 metric tons in 2025."
  • One kilogram of aerospace-grade carbon fiber material costs about $80. Demand will exceed supply by 2025, according to experts.

RESEARCH STRATEGY

To provide the production demand (in tonnes) for carbon in the South Carolina (SC) aerospace industry, the research team began by searching through the public domain for any readily available information from industry-oriented resources as well as government and non-government commerce-focused and statistics resources. Our research began by searching through SC-based and national aerospace-focused resources such as SC Aerospace, SC Aeronautics Commission, and the Aerospace Industry Association (AIA) in the hope that they had provided or highlighted statistics on the industry's raw material consumption/demand. Aerospace-focused resources only provided information on the contribution of the SC aerospace industry to the expansion of the state's carbon sector and the profiles of companies in both the carbon production and aerospace manufacturing industries. AIA seemed to only focus on the general performance of the aerospace industry, including SC's.

We also considered both state and national manufacturing-focused resources such as the South Carolina Manufacturers Alliance and the National Association of Manufacturers expecting that they had provided data on the overall production demand for raw materials in SC, as well as breakdowns by use and type. However, both state and national manufacturing-oriented resources only provided information on the performance of the SC manufacturing industry and no breakdowns of the production demands.

Our first strategy also entailed researching through governmental and non-governmental commerce/development-focused resources at all levels, for example, the U.S. Chamber of Commerce and its regional affiliates, SC.gov, SC Department of Commerce, the Bureau of Labor Statistics, SelectUSA.gov, and the U.S. Department of Commerce. We hoped that these resources contained information on the aerospace manufacturing industry and its demand in terms of raw materials, as well as a breakdown by location and type. Again, there was only data on the performance growth and trends in the U.S. and SC aerospace industries.

Our second strategy was to leverage market research and attempts to find industry expert analysis on the overall market in an attempt to find insights for South Carolina. We could only find reports from market research sites such as Deloitte and Grand View Research on the size, growth, and trends in the global aerospace parts manufacturing market. We followed this strategy with a comprehensive search through regional, state, and national media resources as well as press release sites, in case we had missed any reports/statistics or they had highlighted any sentiments by industry experts/authorities. There was only reports on the expansion of carbon composite manufacturers into the state due to the growing aerospace industry, as well as the financial performance and impact of the SC aerospace industry.

For our third strategy, we took a different approach and decided to find data that we could use to compile an estimate or a proxy figure for the required information. In the course of our first strategy, we had found a list of the top manufacturers in the SC aerospace industry by investment and another of the carbon fiber composites suppliers in SC. The research team then searched through the list of top manufacturers in case they had disclosed their demand for carbon so that we could provide a proxy figure. We also searched through the suppliers of carbon in case they had specified how much carbon they supplied to the state's aerospace industry. However, the desired information was unavailable since they only focused on their overall production or supply capacities.
Part
02
of three
Part
02

Aerospace Industry Research - Fiberglass

The production demand of fiberglass in the aerospace industry in South Carolina is not available publicly, however, other pieces of information that are publicly available can be used to triangulate an estimate. The fiberglass production demand in the South Carolina aerospace industry is estimated to be 254.3 tons annually. Details of the calculation are given below.

Data Used for Calculation

  • The global fiberglass market for the aerospace industry will reach $188.8 million by 2021.
  • The market will grow at a CAGR of 5% during the period spanning 2017-2021.
  • The glass fiber market in the US was valued at $2.1 billion in 2017. In terms of weight, the fiberglass market represented sales of 1.134 million tons.
  • The commercial aircraft market will be worth $6.8 trillion by 2038. The fleet is expected to grow at a rate of 3.4% annually over this period.
  • The South Carolina aerospace market generated revenues of $7.9 billion in aircraft sales in 2018, which grew at a rate of 25% during the past year.

Research Strategy

We started the research by looking for publicly available estimates of fiberglass consumption and/or requirement in the aerospace industry in South Carolina, however, the same was not publicly available. We went through industry publications, market research reports, media articles, and sources from organizations operating in the aerospace industry in South Carolina, but to no avail. Consequently, we decided to triangulate an estimate for the same.
We have estimated the production requirement of fiberglass in the South Carolina aerospace industry by comparing the South Carolina aircraft market to the global aircraft market and then using that comparison in tandem with the global fiberglass market. The details of the calculation are given below.

Calculation

  • The current market size of the global fiberglass market for the aerospace industry can be calculated as follows:
Global fiberglass market for the aerospace industry by 2021 = $188.8 million
CAGR = 5%
Global fiberglass market for the aerospace industry in 2019 = $188.8 million / (1.05^2) = $171.25 million
  • The price of fiberglass per ton can be calculated as follows:
Fiberglass market size in terms of $ value = $2.1 billion
Fiberglass market size in terms of tons = 1.134 million tons
Fiberglass price per ton = $2.1 billion / 1.134 million tons = $1852
  • Using the per ton price of fiberglass, the weight of fiberglass in the aerospace industry can be calculated as follows:
Global fiberglass market for the aerospace industry = $171.25 million
Price per ton of fiberglass = $1852
Weight of fiberglass for the aerospace industry = $171.25 million / $1852 = 92,468 tons
  • Assuming that the aircraft market will grow at the same rate as the fleet, the current commercial aircraft market can be calculated as follows:
Commercial aircraft market by 2038 = $6.8 trillion
Annual growth rate = 3.4%
Current commercial aircraft market globally = $6.8 trillion / (1.034^19) = $3.6 trillion
  • Assuming that the growth rate remains consistent, the revenue generated by the South Carolina aerospace market through aircraft sales in 2019 can be calculated as follows:
Aircraft sales in 2018 = $7.9 billion
Growth rate = 25%
Aircraft sales in 2019 = $7.9 billion * 1.25 = $9.9 billion
  • Comparing the global aircraft sales to that of South Carolina's, the market share of SC in global aircraft sales can be calculated as follows:
Global aircraft sales = $3.6 trillion
South Carolina aircraft sales = $9.9 billion
SC market share in global aircraft sales = $9.9 billion / $3.6 trillion = 0.275%
  • Assuming that the consumption of fiberglass is in the same proportion as that of aircraft sales, we can calculate the requirement of fiberglass in the SC aerospace industry as follows:
Global fiberglass consumption in the aerospace industry = 92,468 tons
SC market share in the global aircraft market = 0.275%
Fiberglass consumption in the SC aerospace industry = 92,468 * 0.275% = 254.3 tons
Part
03
of three
Part
03

Aerospace Industry Research - Aramids

The US aramid market was valued at $656.1 million in 2018. However, even after exhaustive research in the public domain, the production demand for aramids in the South Carolina aerospace industry could not be located nor calculated because of the lack of available data points. Below are some relevant findings and paid reports that might contain the requested information.

Relevant Findings

  • In 2018, the global aramid market size was $3.3 billion, and the market is expected to have an 8.3% CAGR from 2019 to 2025.
  • In 2018, the US aramid market was $656.1 million. The aerospace industry of South Carolina, which employs 22,000 South Carolinians, has an economic impact of $19 billion, making the sector a major pillar of the state's economy.
  • Hexcel Corporation experienced an 8% increase in commercial aerospace sales in 2018, and this increase was driven by the continued demand for "lighter, stronger, and non-corrosive advanced materials."
  • Teijin's sales of aramid fibers were strong, which was driven by the demand for the material in automotive and optical fiber applications.

Paid Reports

  • "2014-2023 Global Composite Aerostructures Market Outlook," by Composites Forecasts Consulting: This report has a breakdown of the volume of raw materials of aerostructures in terms of composites as well as manufacturing process considerations.
  • "Aramid Fiber Market Growth, Trends, and Forecast (2019-2024)," by Mordor Intelligence: This report contains the revenue share of the aerospace & defense industry in the aramid fiber market.
  • "Rise in Aramid Fiber Demand in Numerous Industries to Make Market Fetch CAGR of 7.8%," by Transparency Market Research: This market report has a regional analysis of the aramid fiber market in the US; however, we cannot ascertain that it also has state-specific reports.
  • "Aramid Fiber Market Size, Share & Trends Report | Analysis Report by Product, Application, Region, and Segment Forecasts (2019-2025)," by Grand View Research: This report has similar content of the previous two paid reports.
  • "Aramid Fiber Market Segmented By Application, Size, Share, Industry Trends, Growth, Challenges, Analysis, and Forecast to 2023," by New Channel Nebraska Central: This report has data specific to the types of aramids, meta-aramid and para-aramid.

Research Strategy

To provide the production demand for aramids in the South Carolina aerospace industry, we started our research by looking for industry reports published by research firms and leading aramid and aerospace companies as these reports usually contain statistics on market size, CAGR, demand and production, and other similar data. However, we only found figures on the size of the US aramid market and the South Carolina aircraft sales in 2018. We also tried looking for reports from South Carolina's relevant government agencies, and we found the state's Department of Commerce's report on the advanced materials industry, a very brief report from the state's economic development team on advanced materials chemicals, and the state's manufacturing industry report from the National Association of Manufacturers (NAM). However, these reports focused on the value of investments the industry brought into the state and the number of jobs it created. There was no information on the demand for aramids, and even for composite materials/advanced materials as a whole.

Next, we changed our strategy and looked for data points we could use to triangulate the requested information. Since we already found the global and the US market sizes of aramid, we looked for the share of the aerospace industry either in the global or US aramid space. The idea was to calculate the market size of the aramids used in the aerospace industry globally or the US. After which, we would divide the global or US aramid size for the aerospace industry, whichever is available, by the price per ton of aramid. This would give us the production demand in tonnes. Next, we would look for the size of the aerospace industry of South Carolina and find the ratio between this industry to the US or globally, which result we could use to assume to be the same with the ratio of the production demand for aramids in the South Carolina aerospace industry in tonnes. We found reports that contain the information; however, they are paywalled. Although these paid results have published charts of the revenue share of end-user industries of the aramid market, these charts do not have labels, so we could not assume the value of each share. We tried looking for press releases of these paid reports as some press releases have some statistics and data in them, hoping that one of them might contain the percentage of aramids used by or for the aerospace industry. However, this strategy also did not give us any significant results.

Lastly, we changed our strategy again and looked for annual reports on the top companies in South Carolina that produce aramids as some annual reports contain information about the industry as a whole. However, most of the annual reports of these companies are not publicly available. The ones that are publicly available do not contain information on the production demand for aramids in the aerospace industry. The only relevant information we got from these annual reports was Hexcel Corporation experienced an 8% increase in commercial aerospace sales in 2018, and this increase was driven by the continued demand for "lighter, stronger, and non-corrosive advanced materials." For Teijin, they mentioned that the sales of their aramid fibers were strong, which was driven by the demand for the material in automotive and optical fiber applications.

Despite not finding the requested information, we presented some relevant insights above and paid reports that might contain the requested data.
Sources
Sources

From Part 03
Quotes
  • "The global aramid fiber market size was valued at USD 3.3 billion in 2018 and is expected to grow at a CAGR of 8.3% from 2019 to 2025. Increasing utilization of lightweight aramid fiber in the production of electrical insulation and in rubber reinforcement applications is projected to drive the market over the forecast period."
Quotes
  • "The U.S. aramid market was valued at USD 656.1 million in 2018 on account of the high product penetration in various application industries such as rubber reinforcement, security & protection, and aerospace."