Metalworking Forecasting Tools

Aerospace

Real personal income ex. government transfers includes employee compensation, rental income, dividend and interest income. System revenue passenger miles is the number of seats purchased on a domestic or international flight multiplied by the number of miles the flight traveled for U.S. air carriers. This statistic gives us an indication of how busy airlines are and the need for airlines to add capacity . On average changes in real personal income lead changes in system revenue passenger miles by seven months.

System revenue passenger miles is a fairly good leading indicator for aerospace industrial production. The relationship seemed to break down during the 1990s, but seat miles have started leading industrial production again at the start of this decade. On average, system passenger seat miles leads aerospace industrial production by 16 months; however, the lead time has been short as 1 month and as long as 34 months.

Industrial production of durable goods leads machine tool unit sales. For the aerospace industry, it appears that this is the case for only the most recent part of the cycle. Although, it would be helpful to have more historical data to draw a definitive conclusion.