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October, 2009 - Vol 1, Issue 2 |
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| Dear Embedded Colleague, |
In this edition of the Embedded Market Intelligence Newsletter
we investigate the current and upcoming issues facing America's
aerospace and defense industries. We hope you enjoy the content and
pass it on to your friends and colleagues. If there's a topic you would
like to see discussed please contact us.
Dr. Jerry Krasner
Embedded Market Forecasters |
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Prepare for the Worst - or it will catch you Unprepared:
The Restructuring of America's Aerospace and Defense Industry and how
the ripple down consequences will impact the Embedded Industry |
 The
Aerospace and Defense Industries of the United States are poised to
undergo one of the most significant changes since the end of the Cold
War; perhaps the most significant since World War II. We believe that
observers (embedded vendors included) who expect small changes are
mistaken, will fostering a false and dangerous sense of security across
much of the industry and government.
The
impact to our economy goes far beyond our current financial problems
and involves fundamental structural changes taking place in the
industry and in the market. As in prior shifts of this nature, there
will be winners and losers - however these shifts may be profound,
creating more dramatic winners and losers than in the last cycle.
The
impact of major primes shifting financial challenges to their vendors
(and by association to embedded sub-vendors) will reach down into the
value chain, in some cases devastating naïve second and third tier
vendors.
That
the DoD will experience an 18% to 40% reduction in discretionary
funding is a certainty. Such luminaries as Ken Krieg, former Deputy
Secretary for Defense Acquisition, and Booze & Company have
affirmed this to be the case.
Steve Roemerman, CEO of Lone Star Aerospace, has written a definitive paper "Restructuring
America's Aerospace and Defense Industry; How will it happen and what
will it mean to Lower Tiers and Supporting Embedded Industries".
Steve, a former TI and Raytheon Senior VP, is a recognized strategy
advisor to government and industry organizations, and is currently a
senior advisor to the Navy, Marines, Air Force and NASA. EMF frequently
partners with Lone Star Aerospace who uses the EMF Dashboard to develop embedded technology ROIs
Roemerman,
whose forecasts parallel Krieg and Booze, details the consequences and
offers twelve specific suggestions for the lower tier and their
suppliers. According to the Congressional Budget Office, the share of
the US gross domestic product (GDP) allocated to defense spending
declined from 5.6% in the 80's to 3.8% in the 90's and 3.1% in the new
millennium.
Roemerman
points out that FY 2010 may be the 14th consecutive year of spending
growth if real growth is achieved - driven principally by operations in
Iraq and Afghanistan. The last time defense spending grew for this
period of time was in 1837.
In November, EMF will post Roemerman's paper on the Embedded Market Forecasters website. |
| Embedded Market Forecasters Market Intelligence Briefs |
 EMF has made a commitment to the embedded industry to offer important and comprehensive Market Intelligence Briefs to developers, managers and executives at a very affordable price.
The
fact that the embedded business landscape is changing so fast is more
reason for people to look for timely, accurate data and analysis. Check
out the current Market Intelligence Briefs on the EMF website!
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New EMF Quick Survey |
 Embedded Market Forecasters would like your input! We've posted a new EMF Quick Survey
for your feedback and suggestions. If you have any ideas on topics you
would like to see covered either in articles, white papers or reports,
let use know. | |
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