One of the most interesting bits from a wind energy conference I went to last week came from a workshop on how local manufacturers could get into the wind makers supply chain. Some of our aircraft suppliers would match up pretty well in some ways — makers require a wide mix of parts at low volume with a high degree of precision.
But there’s one big difference: profit margins. Aircraft is traditionally a pretty fat business profitwise, and that profit is spread to some extent over the supply chain. On the other hand, turbine manufacturing is already a world-wide industry. US companies would be competing against established Chinese and European turbine makers and suppliers, tightening up the margins. The upshot, said one of the speakers, is that aircraft suppliers may find it difficult to adapt to the price pressure.