TITANIUM Virtual 2020 Summary
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ITA’s ‘Virtual 2020’ Presentations Focus on Good, Bad, And Ugly of Global Aerospace in the Year of Covid-19 WWW.TITANIUMUSA.ORG •
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By Michael C. Gabriele
T
he Titanium Virtual 2020 Conference and Expo, broadcasted online Oct. 1214, was unlike any business forum organized and sponsored by the International Titanium Association (ITA) during the last 35 years. The “virtual” element came out of necessity due to the concerns and travel restrictions from the Covid-19 global pandemic. Even though this online program, by definition, meant “social isolation” and the lack of face-to-face interaction of an in-person event, the Zoom panelists rose to the occasion and delivered thoughtful, coherent, timely observations on current business trends and global market conditions that exist in the age of Covid-19. By any measure, 2020 will go down as the worst year in history for the global aviation industry—a swift downturn that has rattled the titanium industry and the titanium global aerospace supply chain. This steep drop in the commercial aerospace industry has been documented by the International Air Transport Association (IATA), which reported that airlines are expected to lose $84 billion this year. Revenues in 2020 revenue would likely fall to $419 billion compared with $838 billion in 2019, which over 7 million flights were cancelled from January to July. The IATA (www.iata.org), with headquarters in Montreal, is the trade association for the world’s airlines, representing 290 airlines or 82
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percent of total global air traffic. The dire assessment is shared by virtually every industry leader and observer in the commercial aerospace industry. Given the negative impact on business conditions, the question now is: how will Covid-19 affect the titanium industry, which targets aerospace as its showcase market? Speakers on the ITA’s Zoom 2020 Aerospace and Defense panel addressed this question. There was three points of unanimity by the panelist on the current aerospace situation: current market conditions are historically bad; commercial aerospace won’t see a return to more normal market conditions until 2023/2024; and the military aerospace market is reasonably stable for titanium business. Laurent Jara, vice president, metallic materials, Airbus S.A.S., began by first stating that Covid-19 is the most severe crisis every faced by
the commercial aerospace market, but added that his main message of his presentation was “resilience,” and that the industry will bounce back. “We must find ways to mitigate and adapt,” to the crisis, Jara said. However, Jara didn’t mince words assessing the plight of the airline business in 2020: 14,000 aircraft have been grounded; there’s been a 90-95 percent drop in global flights; 80 percent of passenger traffic has been lost this year; there’s been a $31.4 billion loss of passenger revenue; and the global aerospace supply chain is “at risk.” “We’ve managed to ramp down” business this year due to the slowdown, he said. “We now must manage to ramp up. Our supply chain is very complex. We’re trying to find a balance to see what the titanium supply chain is able to absorb.” Jara said titanium demand for Airbus’ A320neo single-aisle jets and A350 wide-body jets is likely to remain “very low” during 2021 and 2022.
