By
Brian R. Hook
“Revenue has grown over the last six years,” says James Fitzsimmons,
president and CEO at the St. Louis division headquarters of
London-based GKN Plc., an aerospace manufacturer with facilities
in more than 30 countries around the globe.
Revenue is currently around $350 million a year at the St. Louis
advanced-manufacturing facility. GKN’s customers are predominantly
military with a growing percentage of civil aircraft projects,
Fitzsimmons says. “We have a strategic plan to grow the business
as we add different products to support our customer base,”
he says.
GKN provides sophisticated metallic and composite assembly for
aerospace-manufacturing companies like St. Louis-based Boeing
Integrated Defense Systems, a division of Boeing Corp. headquartered
in Chicago. Other customers include Bethesda, Md.-based Lockheed
Martin Corp., Los Angeles-based Northrop Grumman Corp., and
Stratford Conn.-based Sikorsky Aircraft Corp., part of United
Technologies Corp.
GKN’s manufacturing operations cover 77 acres, spanning portions
of both the suburban municipalities of Berkeley and Hazelwood,
north of Lambert-St. Louis International Airport. GKN purchased
the facility from Boeing Co. in January 2001 for $61 million
in cash according to reports at the time. GKN currently employs
around 1,400 employees in St. Louis. It has added around 300
jobs over the last six years.
Since a downturn throughout the aerospace sector in the early
part of this decade, GKN is not the only aerospace manufacturer
to add employees in St. Louis. There were 26 different aerospace
product and parts manufacturing firms with 14,807 employees
across the region in 2005, according to the U.S. Bureau of Labor
Statistics. That compares to 23 firms with 12,794 employees
in 2002. The average annual pay at the aerospace manufacturers
totaled $83,068 in 2005, compared to $72,067 in 2002.
In addition to boosting employment, GKN has invested more than
$70 million to improve the capabilities of its St. Louis manufacturing
facility in the last five years.
“Our focus has been investing because we plan to be here over
the long term,” Fitzsimmons says. “We want to be able to provide
our customers with what we call the one-stop-shop, where we
can help them design, and manufacture—whether it is metallic
or composite or flex assemblies, to be able to make them competitive
worldwide.”
Fitzsimmons estimates that the composite area of the aerospace
market is growing more than 10 percent annually, while the metallic
market is growing about five percent.
“We have invested a great deal of focus in developing our capabilities
to support the annual growth rate and to prepare ourselves to
produce future aircraft,” Fitzsimmons says.
“Just 10 years ago airplanes were only maybe two percent composite.
The aircraft of the future, such as the Boeing 787, will be
closer to or over 50 percent composite. Therefore we have structured
ourselves to be able to support that sort of growth.”
GKN has had to reinvent itself a number of times since it first
started in 1759 to stay current with ever-changing market dynamics,
Fitzsimmons says. “We look strategically out 10 years to understand
where we think the market is going,” he says.
“We look at a much broader picture than St. Louis, because we
realize that St. Louis alone cannot support our company’s growth.
We work very hard at providing an integrative capability for
original-equipment manufacturers around the world.”
Across the U.S., the civil aircraft market helped boost the
aerospace industry in 2006, according to the Arlington, Va.-based
trade group Aerospace Industries Associations. Total aerospace
sales increased by $14 billion or 8.4 percent over 2005, reaching
a record $184.4 billion of total sales, a record for the third
year in a row. The aerospace industry also added about 23,000
jobs, reaching a total of 635,000 jobs.
Most aerospace categories showed growth in 2006. Military aircraft
increased $2.8 billion to total $52.8 billion, space increased
$1.3 billion to $38.6 billion, and related products increased
$2.4 billion to $30.7 billion. The civil aircraft category stood
out, according to the association, increasing $8.3 billion,
reaching a total of $47.5 billion.
The trade group says the outlook for this year remains strong.
It projects aerospace industry sales will grow another $11 billion
to over $195 billion. “Looking beyond 2007, the current backlog
of commercial aircraft orders gives us confidence that the civil
aircraft sector will continue on an upward trajectory,” the
AIA predicts.
This outlook bodes well for GKN. “Our company believes the single
largest growth opportunity worldwide revolves on North America,”
Fitzsimmons says.
“Being able to acquire this facility in St. Louis postured us
to be in a very good position for the future. We like very much
being located close to Boeing. But equally, we find geographically
that it is a good location to support all our customers.”
Fitzsimmons also praises the region for being supportive of
the aerospace industry. “We get a tremendous amount of support.
The government and the business environment is very healthy,”
he says. “The quality and the dedication of the workforce is
extremely good. For us, St. Louis has turned out to be a very
good location.”
For more information on advanced manufacturing in the region,
click here.
