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Industry Economic And Ratings Outlook: Commercial Aerospace Is Advancing; Defense Is Retreating Jan 12
Standard & Poors, Jan 2012
Abstract
The prospects for the commercial aerospace and defense industries continue to diverge. Standard & Poor's Ratings Services believes the commercial aerospace sector is entering what could be a prolonged period of increasing deliveries. Aerospace companies are reporting large order backlogs and should benefit from new models despite the headwinds of a weak global economy, high fuel prices, and the possibility of reduced availability of aircraft financing. Defense contractors, however, are likely to see weaker demand. Efforts to reduce the huge U.S. federal budget deficit, the wind-down of operations in Iraq and Afghanistan, and recently proposed changes to U.S. military strategy likely will result in flat to declining U.S. defense budgets for the near future. Similarly, austerity measures will also pressure...
Companies mentioned in this report are: American Airlines Inc.,Boeing Co.,Finmeccanica SpA,European Aeronautic Defence and Space Co. N.V.,Thales S.A.,All Nippon Airways Co. Ltd.,Hawker Beechcraft Inc.
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.
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