November 2010- Despite discussion of and experimentation with alternative materials, the aerospace industry continues to demand many traditional metals for its programs--and the level of demand is good.
Change occurs in the aerospace industry slowly, says Richard Aboulafia, vice president of analysis with Teal Group Corp., Fairfax, Va. "The [materials] in demand now tend to stay pretty constant for a rather long period of time," he says.
At TW Metals, Exton, Pa., demand has been good relative to last year, and the market will continue to be positive in the future, says Bob Mraz, the company’s vice president of sales and marketing. "We see a global increase in demand for the products that would be used in aerospace. Certainly, heat-treated aluminum plate, extrusions, tubing and sheet. We see it in aluminum and titaniums," he says. "Aluminum continues to be the backbone of the industry."
Overall, the industry did not experience extreme lows during the recession as other segments did, says Mraz. "Quite honestly, while aerospace had a fair amount of destocking and then rebooting, there really wasn’t much of a recession to think of," he says. Commercial aircraft production reached 1,007 in 2006, 1,068 in 2007, 1,077 in 2008, 1,156 in 2009 and 1,150 in 2010, notes Mraz. The company expects to see in the latter part of this year and into 2011 a 15 percent to 20 percent increase in the alloys needed for aerospace, he says.
The market largely has relied on traditional materials for aircraft because few models have been introduced into aerospace, and "you wouldn’t introduce new materials on an existing model to any great degree," says Aboulafia. The risk associated with new models limits them to one or two per manufacturer per decade, he says.
Additionally, the shift to new materials often requires overcoming design challenges, says Bill Sales, senior vice president of operations with Reliance Steel & Aluminum Co., Los Angeles. "When you look back and say, ‘Why are the traditional alloys still the major part of that market?’ [It’s because] those are very good alloys for the end use," he says. Composites or different ratios of metals require a lot of testing and proving before a company will use them in mass production of aircraft.
In its quest to reduce the weight of aircraft, the aerospace industry has expressed interest in new materials, such as composites. "The aerospace industry is certainly working with and developing composites as well as other unique materials," says Ed Brennan, chief operating office of Trans World Alloys, Gardena, Calif., which has the bulk of its business in aerospace. "They have a critical demand to be lighter, leaner and greener."
The Boeing Co.’s 787 Dreamliner uses composite materials in up to 50 percent of the primary structure, including the fuselage and wing, according to the Chicago-based company. The 787 also will use 20 percent less fuel than similarly sized planes. Since the program’s launch in 2004, Boeing has secured orders for 847 airplanes from 55 customers from six continents, according to the company.
Although light-weighting and fuel-efficiency benefits exist with composite materials, their integration into the industry is not fast-paced. "It’s the world’s slowest revolution," says Aboulafia. The 787 and Airbus’s A350 have higher levels of composites, but it will be a 'very long time' before other jet models and families adopt their material mixes. Even then, "you will see an increase in the use of exotic metals, such as titanium," because these metals are necessary to connect the composite parts, he says.
The use of composites will not replace metals completely, says Sales. Although the 787 introduced higher levels of composites, it also consumes a large quantity of aluminum, he notes. "It is proven that there are some end-use applications where composites will make sense, but it is not going to replace aluminum," says Sales.
Aluminum mills also are working to develop alloys that can compete with composites’ lighter weight, says Mraz. For instance, aluminum lithium "offers lighter weight than aluminum, typically, but it’s slightly heavier than composites," he says. "It is close in weight to composites, but the price differential between composites and aluminum lithium is negligible."
The aerospace marketplace is large enough for the exceptional metals producers and distributors to have a place in it going forward, but their numbers may decrease, says Brennan. "The good ones, the effective ones, will find a place, because there is going to be a metals industry within aerospace. The pie will just be adjusted because composites will gain a certain portion of it," he says.
Ultimately, composites are not an enemy to metals; they are an ally, says Mraz. Composites are lightweight, which enables aircraft to save fuel. "Saving fuel means newer planes. Newer planes mean more build. More build equals more aluminum and titanium," he says. "For the foreseeable future, I would say aluminum and titanium are certainly going to be the backbone of every major air frame that’s going to be built."
Into 2012 and beyond, "it’s a pretty bright outlook," as demand for materials likely will continue, says Sales. "We think we’ll see much of the same in 2011 [as 2010], with some improvement in the second half of 2011. Our view of 2012 is that it would be a very good aerospace market," he says.
Indeed, "aerospace has been good, and it’s getting better quarter over quarter, and it’s anticipated that it will continue to get good over the next several years," says Mraz. "It’s in an up market." The industry is between nine and 18 months ahead of the supply chain for aerospace. "We are buying metal today that probably won’t be flying until the second or third quarter of 2011," he says.
TW Metals’ customers are continuing to order after destocking and rebalancing inventories because they still are building planes, Mraz says. 2011 is going to be "one of the biggest years we’ve seen in the past few years," he says. "It’s a good business for the next five to seven years as we see it."
The industry is dealing with an aging fleet, and it will require replacement aircraft, says Sales. The global aerospace market also is continuing to expand.
"Air travel is in its infancy in several of the third-world countries. That’s where they are calling for growth," says Scott Fasse, vice president of marketing and business development at United Performance Metals, Hamilton, Ohio. "There are new airports being built all over in third-world countries, and they are going to need fleets there."
Although the percentage of people who can afford air travel is much smaller in countries such as India and China than it is in the United States, their population is greater while their fleet size is considerably smaller, says Brennan. "Somebody will have to build the aircraft to meet that future need. I believe the future for the aerospace industry will be very positive for the companies positioned to take advantage of this growth," he says.
For aerospace suppliers, "it’s best to be prepared because there are a number of ideas and different approaches being tried now, and the jury is very much out," says Aboulafia. "There is no easy path here. You have to be flexible in terms of what you offer." MM