The United States remained the top-ranked country for aerospace and defense “attractiveness,” consulting firm PwC said in an annual report.
“The country’s dominant industry size is supported” by the U.S. economy “and strong domestic transportation infrastructure,” according to the report. The ranking “was also strengthened by a growth in international and domestic passenger traffic.”
The rankings were based on various factors, including industry size, cost, labor and tax policy.
Also repeating their positions in the 2019 rankings were Canada at No. 2 and Singapore at No. 3.
Canada kept its ranking because of “an educated labor force, low level of geopolitical risk, and industry size,” PwC said. Singapore has “a stable government, strong manufacturing base, and favorable tax policy.”
The United Kingdom moved up one slot to No. 4 in the 2019 rankings from 2018. The U.K.’s position, however, may be tenuous.
PwC said the U.K.’s aerospace and defense industry is strong. “However, most of its aerospace production is exported, which may be adversely affected by Britain’s exit from the European Union,” the consulting firm added. “Uncertainty over Brexit terms and the potential disruption to the country’s global supply chains has led to speculation that the industry may have more difficulty attracting global investment going forward.”
The U.K. voted to depart the EU in a 2016 referendum. Former Prime Minister Theresa May negotiated a divorce but couldn’t get the agreement approved by Parliament. A new prime minister, Boris Johnson, is now in office. He is seeking new terms from the EU. Johnson says the U.K. will leave the EU this fall even without an agreement. Such a “hard exit.” has the potential to disrupt the economies of the U.K. and Europe.
The new No. 5 in the rankings is Australia, an improvement of two slots from 2018. Australia’s ranking “is supported by its low costs and relatively low level of geopolitical risk,” PwC said. The country also in 2018 released a long-term plan aimed at improving the competitiveness of its defense industry.
Switzerland, which was No. 4 in 2018, fell to No. 6 in this year’s rankings.
PwC also ranked U.S. states. Washington state, where Boeing Co. has much of its manufacturing operations, was No. 1.
Washington ranked favorable in the categories of industry, infrastructure and economy, PwC said.
“With a total workforce of over 136,000, the state produced 1,400 aircraft and unmanned aerial systems in 2018,” according to the report. “It also manufactured nearly 90% (741) of all commercial aircraft” in the United States.
Boeing is facing a major challenge with the grounding of its 737 Max aircraft. Two 737 Max planes crashed killing 346 people. The aircraft maker is working on a software fix for the plane. A timetable for the aircraft to return to service is uncertain. The 737 Max is built in Renton, Wash.
Rounding out the top five U.S. states were Georgia, California, Michigan and Illinois.