Aerospace OEMs search for local suppliers

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As Lockheed Martin and Boeing scale up operation in the Palmetto State, the aerospace giants are on the hunt for regional suppliers and vendors able to meet local needs.

“I know personally that with Lockheed Martin's new production, that they have been aggressively seeking local companies to do business with, and some of these are not what you would call traditional aerospace suppliers,” said Jody Bryson, CEO and president of the S.C. Aviation and Technology Center, home of Lockheed Martin’s Greenville facility. He noted that this is just a small-scale representation of the supply chain shift that could be triggered by Boeing’s consolidation in North Charleston.

Boeing already partners with 259 South Carolina suppliers and vendors from Anderson to Westminster and leaves a $331 billion purchasing footprint as it does business, according to a 2019 report from the company. AVX, GKN Aerospace, Honeywell, US&S, Sealevel Systems and Mankiewicz Coatings are a few names in Boeing’s statewide web of business partners.

The aerospace industry is not like the auto manufacturing sector, said Bryson and a number of other industry professionals SC Biz News spoke with. Unlike BMW or Volvo, Lockheed and Boeing will not be finishing hundreds of vehicles in a day. There is time to transport specialized parts from other parts of the country or world, and it may not be profitable for these companies to leave existing infrastructure behind to be within a few minutes’ drive of their OEM partners.

In other words, it takes patience and dedication to foster an aerospace supplier cluster within a centralized location.

One local Boeing supplier, Toray Industries, has traditionally supported Charleston’s 787 Dreamliner production a few hours away from its Spartanburg location. Don Myers, the company’s aerospace sales director and the chair of the S.C. Aerospace Advisory board, expects other suppliers and OEMS to follow suit in the years ahead.

“I think that you are seeing a trend from the OEM manufacturers to have a little bit of a more localized supply chain,” Myers said. “It creates great jobs locally, they’re able to keep the quality closer, they’re able to cut costs on the shipping of the parts and materials and things like that if the parts manufactured and raw materials are closer to where the parts are being used.”

He expects that aircraft manufacturing suppliers, especially in the commercial field, will begin to behave more like auto manufacturers due to increased cost pressures and the enhancement of technologies that would allow for much faster parts production. Composite parts, which Myers said play a significant role in the South Carolina aerospace manufacturing market, will be the most likely to see this transition.

Lockheed too, despite a relatively recent leap to manufacturing in the Greenville area, has linked up with Upstate companies to fill production needs, while also attracting legacy partners from afar, including the newly-dubbed F-16 aftermarket service provider All Clear, derived from a merger between California-based Kellstrom Defense and Aero Precision. The company announced its $1.2 million investment in a Greenville facility in July, along with the creation of 21 manufacturing jobs.

“The global F-16 supply chain is extensive and robust, and we continuously evaluate opportunities for competitive regional suppliers,” Leslie Farmer, spokesperson for Greenville’s Lockheed location, said in an email. “In fact, we have already partnered with several local and state suppliers in South Carolina that are supporting the F-16 production line in Greenville.”

Lockheed has 600 international and national suppliers, she said, with two-thirds of the company’s budget going toward its supply base.

Local companies interested in pitching services to the OEM should first determine which focus area to target by reading Lockheed’s annual report, “What We Buy Directory” and corporate agreements listing, available online. Candidates must then submit business information to Lockheed’s Supplier Marketing Portal available on the company’s website with NAICS codes, quality certifications and Small Business Association size standards at the ready. Prospects can subscribe to receive updates from the immediate needs bulletin board, and those specifically focused on research and development can be added to Lockheed’s Small Business Innovation Research Program directory for consideration.

Lockheed’s supplier site also suggests that prospective suppliers can meet procurement teams and other representatives at outreach events including the company’s virtual Tech Connect Business Program and Showcase on Nov. 17- 18. Bryson said Mike Fox, the company’s Greenville site director and general manager, can be a contact for regional companies seriously considering a pitch to Lockheed, but most candidates are routed via the supply website to business development representatives.

“We always welcome interest from new supplier partners,” Elizabeth Holland, spokesperson for Boeing, said in an email. Holland said potential Palmetto State suppliers should register through the online aerospace trading exchange Exostar and on Boeing’s Supplier Capability Assessment Database, after considering Boeing’s general market needs at http://www.boeingsuppliers.com/become.html.  Boeing relies on a competitive bidding process for procurement, and only procurement agents on the company’s Supply Chain Management team can decide on a contract.