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Airbus growth forecast bodes well for coastal aerospace corridor


Mobile, Alabama - Opportunity and transformation are the words on the lips of both local and regional economic development officials in the wake of Airbus revised global aircraft forecast through 2031.

"We're already the fourth-largest aerospace corridor in the world, and this is just going to make it stronger," said Neal Wade, chairman of the Aerospace Alliance and Alabama's former secretary of commerce.

The European plane maker released today a revised 20-year forecast for aircraft demand, indicating some 28,200 planes will be needed to offset rising fuel costs and capitalize fully on servicing emerging markets.

But what exactly does an estimated $4 trillion global investment mean for the city and region selected in July to house Airbus first aircraft assembly plant in the United States?

Troy Wayman, vice president of economic development for the Mobile Area Chamber of Commerce, said the $600 million facility expected to generate more than 3,000 direct and indirect jobs by the time production begins in 2016 certainly means far more than planes in the air and jobs on the ground.

"I think Airbus has seen the writing on the wall for a while that the aircraft market is right on the cusp of immense growth and I think its one of the things that helped them make the decision to build here in Mobile," he said. "And when you're talking about $100 million per aircraft, that's a lot of money."

Specifically, Airbus estimates the global passenger jet fleet will increase 110 percent to nearly 33,000 planes by 2031, while the global freighter fleet is expected to double during that same period to roughly 3,000 aircraft.

In turn, the company projects the Asia-Pacific market will account for 35 percent of the growth experienced, followed by Europe and North America with only 21 percent each. Wade says the corridor stretching from Florida to Louisiana trails only California; Toulouse, France; and the Seattle-Tacoma, Wash., region in the number of aerospace jobs created globally.

"What's significant for us is that the (Airbus) plant will become reality in the next three years and will continue to grow. There's plenty of space to grow at Brookley (Aeroplex), and there's plenty of room regionally to expand and grow suppliers in any of the four states supported by our alliance," Wade said.

The real magic for the Gulf states, he said, is the multiplier effect the region will enjoy should Airbus projections hold true, and he has every reason to believe they will once emerging markets invest in fleets and existing ones upgrade to more fuel-efficient models.

"The biggest thing is that Airbus made the decision to put a footprint in the United States. Doing that gives them more opportunity to meet or at least come close to those projections, and it allows all of us along the Gulf Coast to have more opportunities to attract suppliers and support the growth of the entire aerospace corridor," he said.

Wade likened the phenomenon to the debut of Mercedes-Benz U.S. International in Vance, Ala., in 1993. The automotive manufacturing juggernaut started with one assembly line that employed 1,500 people, and now its approaching the introduction of a fourth line.

"Once an international company puts a footprint in a new market, the potential is there to expand and to grow," he said, noting the economic multiplier for aerospace is admittedly closer to 3-to-1 than the 5-to-1 enjoyed in automotive manufacturing.

"The point is, once you get the Mama plant, you'll be able to fuel that ripple effect, and I don't know what else you'd call Airbus in this scenario," Wade said.

Indeed, Airbus captured 64 percent of the global passenger jet market in 2011, but less than 20 percent of that market is in the United States, and Wayman is hopeful Mobile can position itself to capture as much of that growth as possible.

"If it continues to a point they cant provide inventory from other facilities in other parts of the world, it may be those growth opportunities could be shifted here. But even if that's not the case, there are still significant opportunities for us all along the Gulf Coast to take advantage of this announcement," Wayman said. "The very fact that now we can say we're home to Airbus has changed the impression other industries have of what can be accomplished here."

And Wade contends it's "absolutely realistic" to expect Mobile and the surrounding corridor to capture a substantial amount of projected aviation growth during the next two decades.

"This is absolutely nothing but good news. Airbus is an anchor project that's going to have a tremendous impact on all of us, and while we have to deal with the (economic) realities of the moment, these projections help us prepare for what could - and most likely will - happen," he said.

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