Mixed news keeps aerospace, defense uncertain
Colorado’s aerospace and defense industry had promise for an exciting and economically revitalizing 2014 — until Monday, Dec. 30, when the Federal Aviation Administration announced that the state was not chosen to become one of the country’s six UAS (unmanned aircraft systems, or drones) test sites.
Although the outcome wasn’t ideal for aviation enthusiasts, drones will still provide plenty of opportunity for growth along the Front Range, according to Andy Merritt, chief defense industry officer at the Colorado Springs Regional Business Alliance.
“There are still things that we will keep trying to pursue in the future,” he said. “I think that [the FAA] missed an opportunity. … [Colorado] could have offered some unique characteristics.”
Folks with both commercial and governmental ties to the multi-billion dollar Colorado industry will continue trying to “carve out a niche” in drone testing and use, Merritt said.
“We’re still going to be exploring new opportunities,” he added.
He said that state entities that have been experimenting with drones for application in natural disaster prevention and relief will continue to do so, while connections to agriculture and other ventures may be put to the side in lieu of the FAA decision.
“The challenges will continue to be budget-related for both the military and the defense contractors,” said Merritt, who explained that it is difficult to determine what impact this might have on the regional economy until appropriations are made sometime next year.
But lost opportunity and sequestration is only half of the story; the other half seems much more encouraging.
Virginia-based defense contractor Exelis Inc. announced earlier this month that it will spin off a segment of its own IT Services division to create an independent Mission Services company based in the Springs. The company, which is expected to be operational by the summer, will employ 7,000 workers in more than 100 locations across 18 countries, according to an Exelis news release.
Exelis Mission Systems will become the area’s largest public company, and Merritt said that multiple others have looked to the Pikes Peak Region for possible expansion or relocation.
As far as change in workforce goes, Merritt said it is too soon to tell due to the many complexities at hand: While companies like Exelis are creating jobs, military downsizing threatens to reduce them.
“There are just so many variables out there right now,” Merritt said.