CompositesWorld's second Investment Forum explores down market pros and cons

Speakers at the CompositesWorld Investment Forum in New York last week offered much to consider as use of composites continues to evolve in aerospace, wind and other markets.

CompositesWorld, publisher of HPC, welcomed 60 investment, materials, processing and fabricating professionals to its second CompositesWorld Investment Forum, Feb. 26-27, at the Roosevelt Hotel in New York City. The two-day event, designed to evaluate market strength, technology evolution and investment opportunity in the composites community, kicked off with keynote speaker Andrew Moss’ outlook for several key end markets. Moss, the COO of Umeco plc (Leamington Spa, U.K.), suggested that single-aisle replacements for the Airbus A320 and Boeing 737 can be fabricated from composites only if production systems are developed that can keep up with required aircraft production volumes. He has high hopes that out-of-autoclave (OOA) materials can be used in aerospace applications. Kevin Michaels, principal of AeroStrategy LLC (Ann Arbor, Mich.), reviewed each segment of the aerospace composites market and forecast an overall 3 to 4 percent decrease in air passenger traffic for 2009, and an associated 5 percent drop in aircraft utilization. He said the business jet market is expected to be the hardest hit by the global economic slowdown, but he believes that commercial jet builders Airbus and Boeing have sufficient order backlogs to weather the downturn with only modest impact. Michaels expects total composites aerospace demand will drop 10 percent through 2011. Mark Agosto, managing director of McGladrey Capital Markets LLC (Costa Mesa, Calif.), provided an overview of capital markets activity in the composites marketplace. His remarks are summarized in ”Market Trends,” see link at right.

Chris Red, editor and VP of market research at Composite Market Reports (Gilbert, Ariz.), discussed the outlook for composite aerostructures and noted that the composites-intensive F-22 fighter jet might not survive scrutiny by the Obama Administration; the F-35 Lightning II Joint Strike Fighter (JSF), also composites-intensive, might survive, given the involvement of cooperating countries. Red talked extensively of emerging aircraft, including unmanned combat aerial vehicles (UCAVs, see link at right). He suggested that application of composites in commercial aircraft might top out at 60 percent of airframe weight given the scarcity of further applications that can be converted to composites.

Carl Ulrich, managing director of Allsteams LLC (McLean, Va.) delivered the presentation prepared by Tim Shumate, marketing manager at ATK Composites (Layton, Utah), who was unavailable. Shumate’s focus was on the impact of growth on the aerospace composites supply chain:  Consolidation among carbon fiber suppliers, prepreg suppliers and Tier 1 aerospace suppliers has radically changed the composites aerospace supply chain, creating a simpler, flatter structure with Boeing and Airbus relying more on tier partners for investment and design help. Ulrich noted that Shumate believes automated fiber placement (AFP), automated tape laying (ATL) and out-of-autoclave technologies are growth enablers for composites.

Ron Epstein, aerospace and defense specialist at Merrill Lynch/Bank of America (New York, N.Y.), attracted attention with his presentation on Wall Street’s view of aerospace markets. Like Michaels, he predicted a 2 to 4 percent drop in air traffic in 2009, followed by a flat 2010. He noted that Airbus and Boeing are not overbuilding, have a healthy log of orders to fill, and could find that the next up-cycle is a robust one. Epstein does not expect a single-aisle replacement from Airbus or Boeing before 2015 and wondered if such planes would be produced without an autoclave. Epstein added that he expects all future aircraft will be made with composites, with the full impact of this trend felt after 2015.

Steve Luby, president/CEO of VISTAGY Inc. (Waltham, Mass.) identified as particularly promising the use of ceramic matrix composites (CMCs) in aircraft engines. He suggested that 40 percent of aircraft engines could be composites within the decade. Stewart Bain, president of BCI (Ottowa, Ontario, Canada), said applications of CMCs will be targeted to jet turbine blades, vanes, shrouds and combustor lines, where high temperature resistance is key. Rolf Trondle, sales manager at Santex AG (Tobel, Switzerland), discussed the use of carbon fiber prepreg in composites manufacturing and reported that ~70 prepreg lines produce 56,000 tons/year of material; he forecast that by 2013, there could be 50 new carbon fiber prepreg lines added to the global market, producing an additional 50,000 tons/year of material.  Allstreams’ Ulrich, in his own presentation, highlighted trends in carbon fiber recycling, and estimated that the recycled carbon fiber market could hit $250 million by 2019 based on a $5/lb price point.

Huw Radley, managing director of Solent Composite Systems Ltd. (East Cowes, Isle of Wight, U.K.), focused on renewable energy and forecast that 40 percent of wind energy in Europe will come from offshore by 2030 (up from 1 percent in 2008). He said 72m/236-ft wind blades are under development, and questioned what the optimum cost/weight formula is for such structures — a 20 percent increase in blade length increases weight 66 percent, while energy capture increases only 44 percent. Radley said $1.8 billion of investment is required in blade manufacturing technology over the next five years to meet volume requirements of wind turbine installations. Habib Dagher, director of the AEWC at the University of Maine (Orono, Maine), discussed the potential of offshore wind systems in the U.S., especially in high-wind regions offshore of the Northeast and West Coasts and the Great Lakes.