So what exactly is an aerospace company? Aerospace technically refers to any human effort made in order to be able to fly in the Earth's atmosphere as well as the space surrounding said atmosphere. Aerospace companies hence engage in the manufacture, design, research and operation of aircraft or spacecraft which can accomplish these objectives. While aerospace has very diverse applications ranging from industry and commercial to military applications, most of the companies in our list will be focusing on the latter since that is where the real money is.
The biggest aerospace companies in the world, such as Boeing or Lockheed Martin, do not manufacture just commercial aircraft, but military aircraft as well, and earning these defense contracts can earn the company billions of dollars in revenue. This is one of the most lucrative industries out there of course, with its worth said to be in the $800 billion to $1 trillion range for just the United States of America. A single top company earns tens of billions of dollars in revenue alone, so you can imagine what the worth of the entire industry will be. And the thing is, defense spending keeps on increasing for all countries but especially the United States. The US spends more on its military that most other countries combined and has high tech weapons and technology, a lot of which we are not even aware of, which is why it tops the list of the 10 most powerful militaries in the world. It is said that whatever latest military technology we see is ten years behind what the US actually has at its disposable. And this is especially true for the aerospace industry, as aerospace companies develop high tech stealth aircraft and drones for the military at top secret facilities. In fact, it is the testing of such latest aircraft that many people consider them to be UFOs and lend credence to beliefs in extra terrestrials. In reality, it's just the latest stealth unmanned aircraft capable of high speed movement in any direction. Additional security threats from countries such as North Korea and Iran have also intensified further defense expenditure, which is already over $1.5 trillion.
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Of course, it is important to note that defense is just one of the sectors for aerospace companies. And while defense spending has soared and given a major boost to these companies, other sectors, especially the commercial sector, have fallen drastically in 2019. Production related issues led to fewer aircraft being produced while many orders were also cancelled, and fewer newer orders were placed as compared to the year before in 2018. While initially, towards the end of 2019 and start of 2020, the expectation was that lag would be recovered in 2020, what no one anticipated was the existence of a global pandemic due to a human transmitted virus, which led to lockdowns across the globe and decimated air travel. If you want even a slight idea of the impact, you can take a look at the 10 busiest airports in the world (just before the pandemic hit) and see the drastic initial impact of the pandemic at the start of 2020, before the lockdowns got steadily strict. And with the second wave making its significance felt across the world and especially in Europe, which has led to international air travel being significantly affected again. Many multinational companies have also forbidden any air travel for any reason, as people try to stay isolated to protect themselves and their loved ones against the virus. This is why one of the biggest aerospace companies in the world in Boeing has announced that it will lay off 7,000 more people after already laying off 19,000 people earlier. The company even made losses of $754 million in the latest quarter, even as the revenue fell by nearly 30% or around $6 billion. Even though it is one of the most lucrative industries to be a part of, the aerospace industry has also felt the full force of the pandemic on its business.
To determine the biggest aerospace industries, there were a lot of metrics available to us. The first thing we did was to consult a report by Flight Global, which had information on the top 100 aerospace companies. Based on the list, we were able to determine the revenue of each company. While the list was at a global level, we filtered out the companies which were from the US. This is why Airbus, which is the biggest aerospace company in the world, is not in our list despite revenues of nearly $79 billion as it is a multinational European company. We also considered the number of employees each company had, though lower weightage was assigned to this metric. So let's take a look at the companies with enough resources to likely persevere through the crisis which is the coronavirus pandemic, starting with number 11:
Founded in 1953, it is now one of the biggest aerospace companies in not just the US, but the entire world as well, and is also part of the Fortune 500 companies. In 2019, it earned profits of $7.2 billion and also has over 30,000 employees. Precision Castparts makes industrial goods as well as metal fabrication which includes airfoil castings, forged components and investment castings. Initially, it was a standalone company for most of its life since inception, but in 2016, it became a subsidiary of Berkshire Hathaway, which is owned by one of the richest men in the world in Warren Buffet.
Spirit AeroSystems is one of the newest companies in our list, and is actually a spin-off of Boeing, another company which will make our list later on. It actually came into being when Boeing Commercial Airplanes sold to investment firm Onex, its Wichita division. It has steadily grown since and made $7.8 billion in 2019, while also employing 18,200 people, which seems immense but that is the lowest number of employees we had in our list and is less than a tenth of some of the other companies you will see later on. It has purchased the aerostructures business from BAE systems, which is also one of the largest aerospace companies in the world, but is of British origins. Spirit had to pay around 80 million pounds to purchase the business. Spirit only has a couple of main customers, and in 2010, 96% of sales were to Boeing and Airbus.
Textron is a conglomerate based in the capital of Rhode Island, Providence. It has many subsidiaries comprising of various businesses which include Arctic Cat, Textron Aviation, Bell Textron and Lycoming Engines. It is in fact responsible for some of the most popular aircraft brands such as Hawker, Cessna and Beechcraft. In 2019, Textron had profits of nearly $9.8 billion while providing employment to over 35,000 people. The funny thing is, it actually started off as a textile company, only to transition to aviation later on in the 1950s and 1960s.
General Dynamics has one of the most defense company sounding names I've ever heard of, if that makes sense. It is one of the 100 biggest companies in the US, and was formed back in 1954. The company wasn't a giant in its early years, and went through a lot of investments, acquisitions and divestures, especially during the Cold War era. It's Fort Worth division was responsible for perhaps one of the most famous fighter jets in the world, the F-16, though this division was sold off to Lockheed Martin later on. Lockheed Martin is another company which you will be seeing later on in our list as well. The F-16 has been one of the most successful western military projects carried out since the end of World War II and won contracts worldwide. In 2019, General Dynamics earned revenue of $9.8 billion and had around 107,000 employees.
L3Harris Technologies is at its name suggests, a technology company, information technology services provider and defense contractor as well. It produces various equipment and products including night vision equipment, electronic systems, tactical radios, wireless equipment and antennas which can be used commercially and in the defense sector as well. It earned a spectacular revenue of $18 billion in 2019 while being responsible for a whopping 50,000 employees. The company also provides unmanned aerial vehicles or UAVs to the government as well.
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6. GE Aviation
GE Aviation is a subsidiary of one of the biggest American multinational conglomerates, General Electric. General Electric itself is the 21st largest company in the United States by revenue, and its aviation division alone has earned $32.9 billion in 2019 and employs 48,000 people. GE Aviation is one of the biggest aircraft engine suppliers in the world, and faces primary competition from Rolls-Royce, which you might know more for luxury cars rather than aircraft engines.
