Global Supply Chains and Labor Shortages: Post-Pandemic Struggles in Aerospace

The head of aerospace and defense giant RTX, Greg Hayes, highlighted the challenges in global supply chains and labor shortages post-COVID-19. RTX is considering alternatives to its Chinese suppliers due to geopolitical risks. The firm halted purchases from Russia after its invasion of Ukraine and monitors its 14,000 suppliers daily.

The head of aerospace and defense giant RTX said on Tuesday that global supply chains remain stretched in the wake of the COVID-19 pandemic, and finding qualified labor for aerospace factories remains a 'huge' challenge. 'The supply chain has not recovered,' Executive Chairman Greg Hayes told the Global Aerospace Summit hosted by the U.S. Chamber of Commerce. RTX is researching alternatives to its roughly 2,000 Chinese suppliers in the event of any sudden worsening of geopolitical tensions. Hayes emphasized that RTX is ensuring dual sourcing for all its key components.

RTX is actively reviewing its reliance on Chinese suppliers. 'We're also trying to minimize the geopolitical risk by saying - OK, we've got 2,000 suppliers in China today. What happens if, and we don't know what that if is - what happens if and how are we going to deal with that?' Hayes explained. 'We are actively working, not to pull out of China, but to ensure we have alternatives if something bad does happen.'

In the event of a Chinese invasion of Taiwan, the U.S. government would likely impose sanctions on China, significantly impacting U.S. companies. RTX, which halted purchases from Russian suppliers following Russia's invasion of Ukraine, has 14,000 suppliers globally. 'We monitor them every single day, not just for their delivery performance and quality but also for their financial health and staffing,' Hayes stated. 'Today, it's still a huge challenge to find qualified folks to work on some of these products, and that has not improved as quickly as demand has recovered.'

(With inputs from agencies.)