Commercial Aerospace Suppliers Merge to Combine Resources
Players in the commercial aerospace supply chain face serious competitive headwinds, ranging from cost pressures to the continuing issues swirling around Boeing’s 737 Max. As a way to weather this turbulence, some suppliers in the sector are joining forces.
In a $6.4 billion deal, Woodward, a maker of power, motion and control components, and Hexcel, a composites manufacturer, merged to combine resources and gain competitive advantages. The two organizations called it a “merger of equals.”
“The two companies, when talking about the rationale of the deal, highlighted the work each is doing on sustainability and making planes more efficient, with Woodward focused on control systems and Hexcel advancing lightweight materials,” analyst Lou Whiteman writes. “The combined Woodward Hexcel expects to spend about $250 million annually on research and development, giving it more resources to develop new products quickly.”