What will a Trump Presidency mean for aviation, aerospace, defence and space? TIM ROBINSON takes a look into the crystal ball.
Donald Trump will be the 45th President of the United States. But what will this mean for aviation, defence and space?
After the surprise result of the UK’s Brexit referendum – another shock result delivered by voters has been the result in the US Presidential Election, rejecting the former Secretary of State Hilary Clinton in favour of the businessman, reality TV star and controversial Republican candidate Donald Trump – a person who has never held government office. What then does the election of this outsider mean for aerospace, defence and space?
Rise of protectionism
Attempting to reverse globalisation could have negative impact on the aerospace sector. (Boeing)
With aerospace being a truly global industry – with world-wide supply chains that come together to manufacturer, fly and support aircraft, there are already fears that a Trump Presidency could do damage to this sector by knee-jerk reactions that could spark a trade war. For example, is an Airbus A320 airliner – assembled in Alabama by US workers – a domestic US-produced aircraft? Trade tariffs, for example, on ‘foreign’ airliners could also negatively impact the thousands of US jobs at Pratt & Whitney, Honeywell, etc that supply these.
President-elect Trump has already demonstrated what might considered to be a limited understanding of the aerospace manufacturing industry – accusing Boeing of moving its manufacturing jobs to China after seemingly getting mixed-up that a Boeing 737 interior and paint completions centre in China was an Airbus-style final assembly production line. As aerospace analyst Richard Aboulafia noted: “I think he’s somewhat badly confused about our industry.”
Despite his business credentials – Trump may need educating on how difficult, if not downright impossible, it may be to ‘bring jobs back to the US’ in all areas of the economy – and how interconnected, in particular, the aerospace industry is globally. Today a ‘US airliner’ like the Boeing 787 can include 30% of foreign-supplied parts, including UK engines, fuselage sections produced in Italy and Japan, landing gear made in France, German cabin lighting and so on.
A retreat back from globalisation could end up, in the short-to-medium term, disadvantaging the US aerospace industry and there is no guarantee of success. Centres of excellence in aerospace technology and manufacturing take years, if not decades to develop, thanks to the long product cycles in aerospace. As Russia has discovered after it annexed Crimea, there may be integral parts of your aerospace sector (in its case, helicopter engines made by Ukraine) that in fact lie beyond your borders. Rebuilding these could take time.
Trump’s calls to tear up two international free trade agreements (the TTIP (Transatlantic Trade and Investment Partnership) and TPP (Trans-Pacific Partnership) between the US and Europe and Pacific could also lead to a slowing of growth around the globe.
Aviation and airlines
Calls to defend US airline jobs against foreign airlines like Norwegian are likely to find support. (Norwegian)
Uniquely, the President-elect will come into office having (briefly) run his own airline, the short-lived Trump Airlines – one area at least where he can be considered to have some practical experience.
However, in aviation too, a withdrawal into protectionism could mean negative effects for airlines. Could the Open Skies dispute, where the three big US carriers took on the big three Gulf airlines (Emirates, Etihad and Qatar) over state support, be rekindled under a receptive Trump Presidency? There is also the matter of Norwegian Airlines and its application for transatlantic flights – which has already provoked resistance from US airlines and unions.
Another complex air transport issue in the President’s in-box might be the status of the UK’s international traffic rights and access, post-Brexit. Once the UK is outside the EU-US ‘Open Skies’ agreement – will the status revert to Bermuda II? The answer, brought up at a recent RAeS Conference, is ‘nobody knows’ but IAG chief Willie Walsh has already called for a new US-UK Open Skies agreement.
Fears over immigration and a feeling of minorities not being welcome could also translate into a reduction in tourism to the US. Royal Jordanian Airlines, for example, has already been quick off the mark with a ‘Just in case he wins, Travel to the US, while you still can’ advert on social media.
However, there may be some positive news for passengers fed up with crumbling airports, and air traffic delays in the US air transport system. Part of Trump’s acceptance speech mentioned an ambitious $600bn ‘New Deal’ style stimulus plan to create jobs by modernising US infrastructure – with airports one of the sectors mentioned. Could the upgrading creaking US civil aviation infrastructure – such as airports and NextGen ATM projects – be fast-tracked and given a boost under President Trump?
With Trump being sceptical of climate change, there may be also a refocusing of efforts to develop ‘greener airliners’ or address sustainable aviation growth – bad news perhaps for NASA’s aeronautics research. However, for airlines, saving the planet is also intrinsically bound up in saving fuel and therefore money – which might appeal to his hard-headed business sense.
Defence spending rises?
Trump is known to be in favour of modernising the US nuclear triad. (USAF)
Meanwhile there could be significant shifts in US defence and foreign policy. Though Trump has yet to nominate policy advisors in this area, it is known that he tilts towards an isolationist stance and has drawn fire for his pro-Russian links.
This then could mean a normalisation of US relations with Moscow after recent years where tensions have risen over Crimea, Ukraine and Syria. Indeed, unpalatable as it may seem, it could even mean a potential U-turn from Washington in supporting Assad (or at least becoming neutral) in putting down ISIS and other anti-regime forces in Syria.
Trump’s call to ‘Make America great’ again, though, could be good news for the US defence industry, even if the US does step back from the world stage. Already, defence stocks have soared in anticipation of a larger-than-expected boost to the US military budget. With Congress also now Republican, there is now an end to the Sequestration stand-off.
In particular, Trump has called for a modernisation of the US nuclear triad of submarines, bombers and silo-based ICBMs. One of these (the Northrop Grumman B-21 Raider) is already well underway – but it is worth noting that any nuclear upgrade will also need to include the stand-off weapons that the B-21 will carry.
Baltic states will be feeling the chill. Will this lead to increased European defence spending? (NATO)
Most worryingly for Europe, Trump has hinted that NATO Article V, the bedrock that guarantees that ‘an attack on one, is an attack on all’, which has secured the peace for almost 67 years, is up for discussion if he considers NATO allies are not pulling their weight. This, then could have serious implications for European defence spending if Trump carries out his threat to reconsider US support for NATO allies – particularly for nervous Baltic nations in the front line.
Earlier this year, for example, Sweden’s Saab CEO Håkan Buskhe asked the rhetorical question – was the defence industry ready for increase in European military spending to meet NATO’s 2% GDP goal across the board? This, he noted, could be equivalent to 1930’s levels of rearmament. Facing an emboldened Russia, which may calculate that NATO is coming apart at the transatlantic seams, European leaders may thus decide to pre-empt any US pressure to boost military budgets and increase defence spending themselves first, just in case.
However, it may be the UK, at least, has a more powerful position. If the US does retreat into isolationism, then the UK’s still powerful military forces (and its independent nuclear deterrent) will suddenly be more vital for continental Europe – easing any Brexit divorce.
The ‘Special Relationship’ of intelligence sharing, joint exercises and exchange posting between the US and the UK is most likely to continue under a Trump administration. He is, after all, an Anglophile. This too may have the effect of boosting the UK’s importance in providing a bridge between left-wing EU and a right-leaning US.
Outside Europe, a Trump Presidency could also shake up the international order. He has already said that he is open to Japan, South Korea and Saudi Arabia acquiring nuclear weapons – a major departure for a US President. This tacit approval and US disengagement from geostrategic foreign policy then may speed up nuclear proliferation – marking a riskier age for the world.
But if the threat of direct confrontation between the US and Russia may recede under President Trump, the wild card here could be China – already an economic enemy in his eyes. Given Trump’s notorious quick temper, what would be his reaction to Chinese pressing its territorial claims in the South China Sea?
A Trump administration then, may be a ‘double (or even triple) whammy’ boost for defence firms – an increase in US military spending along with a rise in European NATO defence budgets. US allies elsewhere in the Middle East and Pacific too may feel necessary to stock up on arms if US interventionism is set to be reversed.
Will Trump want to make America great in space again? (NASA)
Finally, there is space policy. Here we are almost in a complete vacuum as regards Trump’s views on NASA’s aims or the direction of US spaceflight.
Indeed, the Presidential campaign was notable in the absence of firm ideas or policy towards space from either candidate, with only President Obama issuing a call last month to land humans on Mars by the 2030s. Quizzed by SpaceNews in October about NASA funding levels, space priorities and mission goals, Trump’s responses were mostly ‘examine spending resources’ and “After taking office, we will have a comprehensive review of our plans for space, and will work with Congress to set both priorities and mission.” In other interviews and statements there has been a reaffirmation from Trump that NASA should concentrate on ambitious exploration, leaving regular ISS resupply flights to public-private partnerships. NASA’s climate change and Earth observation missions can expect to take a hit.
Future US space policy then is extremely vague. While a new President’s spaceflight plans may not always survive (witness George W Bush’s Constellation plan) it is rare for an incoming leader to have almost no thoughts on the subject.
One bright spot may be, that given the new President’s personality and desire to always be the ‘winner’, this perhaps may invigorate a new human space race to Mars, should he perceive that China might get there and plant a flag first.
'Hair Force One' in January 2017. (Boeing)
In short, we are now in completely uncharted waters here. Pundits and forecasters have already been proved horrendously wrong this year in predicting the future. Six months in, we will know much better the direction of Trump’s administration – and many of his wilder statements may have bumped up against reality. A lot may depend on the team of advisors for foreign policy, national security and science with which he surrounds himself and the appointments he makes. What is certain for this President is unpredictably. Buckle up for the ride on Trump’s Air Force One, we may be in for turbulence.