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2020 Aerospace Manufacturing Attractiveness Rankings

UK ranks 7th in the global study with Brexit and COVID-19 challenges playing a role in the drop from 4th position in 2019

The 2020 report assesses a range of aspects such as cash flow and liquidity, government support, labour, tax policy, industry and supply chain disruptions. Crucially it also analyses geopolitical risks such as Brexit, and it is this lingering economic uncertainty - alongside COVID-19 - that has been a factor in the UK’s drop from 4th position in 2019. This year's edition ranks the UK at 7th globally out of 100 countries and as the top performing European nation for Aerospace and Defence manufacturing attractiveness. The US secured the overall top spot globally, for a second year running, closely followed by Canada and Singapore.

According to the analysis, the biggest shifts for the UK were in the cost category (from 4 to 20) and the industry category (from 8 to 17). This is in part due to Brexit trade challenges that continue to impact the UK A&D industry, particularly in relation to supply chains, EU funded research and development investment, access to skilled workers and strategic business partnerships with EU-based companies.

The top 100 A&D companies (by revenue) saw a record $780 billion in revenue — 5% over 2018 - despite the grounding of the 737 MAX, which was the primary contributor to a $25 billion revenue reduction at Boeing. The demand for commercial air travel (as well as cargo freight) will recover, but it’s still uncertain what that recovery may look like, and how long it may take. Indeed, the pandemic may exert permanent changes on the global commercial aviation industry.

Nevertheless, aerospace manufacturing capacity took decades to build, and it should be kept agile in order to fully rebound, with an expected return potentially three to five years. Many A&D companies may emerge from the crisis changed - and even enhanced. Industry stakeholders fully grasp that in order to survive a disruption of this scale, they may need to become more resilient, agile and innovative.

“In what is a tough economic environment, it is critical that trade is as free as possible as we move into this new era. Organisations must also take appropriate steps to ensure they are ready to move people, goods and data differently in 2021.”

Roland Sonnenberg, Aerospace and Defence Leader, PwC UK

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Roland Sonnenberg

Roland Sonnenberg

Aerospace, Defence and Security Leader, PwC United Kingdom

Tel: +44 (0)7976 292063

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