Opportunities for Exporters in the Aerospace Industry

The multibillion-dollar aerospace industry attracts a great deal of international attention as companies such as Blue Origin and SpaceX build rockets and send people beyond Earth’s atmosphere. These companies, plus others such as Virgin Galactic, generate significant news because of their accomplishments and their famous, breathtakingly rich founders. United Launch Alliance is another major rocket company and is planning to launch a large rocket later this year. Smaller rocket companies exist in the U.S. and around the world, most focusing on launching satellites. 

The rocket builders have thousands of suppliers; however, the vast majority of the industry’s multitude of manufacturers of parts, components and software, and consultants and design experts have little or nothing to do with the rocket companies. Rather, they play a vital role in other aspects of the aerospace industry that touch the lives of millions of people, directly and indirectly, every day: airports. 

The need for airport infrastructure, flight training, air traffic control, and airport and ground support equipment continues to grow around the world. Export opportunities exist across the globe as national and regional governments seek to improve their airports and build new ones in Poland, the United Kingdom, Israel, Taiwan, Australia, Malaysia, India, Argentina, Singapore, Ghana, Angola, Turkey, Vietnam, Japan and Italy (Russia and China are excluded in light of the significant U.S. government sanctions in place on both countries). 

This list is not exhaustive; rather, it illustrates the broad international opportunities in this sector for companies willing to expand globally. Many of the projects see a large number of suppliers bidding on government tenders; others involve identifying and appointing sales representatives and distributors or exporting directly to the end users. The global aviation subsector and multilateral initiatives to lower emissions deserve consideration as well. Further, many companies in the aerospace sector manufacture and export products for the defense industry.

A discussion on global opportunities in the aerospace industry must include export controls under the International Traffic in Arms Regulations (ITAR) and the Export Administration Regulations (EAR). ITAR is under the jurisdiction of the U.S. Department of State and regulates the sale, distribution and manufacturing of defense items. EAR is administered under the Bureau of Industry and Security (BIS), U.S. Department of Commerce. EAR covers commercial and dual-use items not covered by ITAR but still applies to some defense-related items.

Exporters must determine which regulations apply to the company’s products since many parts, components and finished products for the commercial aviation sector are also used in the defense industry.

For more on ITAR, EAR and your compliance responsibilities, read these other Passages articles and whitepapers:

• The ITAR Compliance Checklist
• Understanding ITAR: The International Traffic in Arms Regulations
• EAR99 Isn’t a Free Pass for Export Compliance
• How To Determine If You Need an Export License
• What You Need to Know about Export Compliance

Examining ITAR in a global context requires an understanding of the Missile Technology Control Regime (MTCR). MTCR, created in 1987, is a voluntary, international agreement, currently among 35 countries, including the U.S. It is not a treaty. MTCR’s objective is to combat missile proliferation by controlling the transfer of equipment and technology capable of delivering weapons of mass destruction. ITAR is a tool to help achieve this objective.  

With its numerous subsectors, the large and growing aerospace sector offers highly lucrative global business opportunities for companies willing to work with governments and the private sector. Patience, flexibility and developing a strong export compliance program are critical for success.