Port SA: Growing San Antonio’s Stake in Aerospace, Pt. II

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Engine maintenance work at Lockheed Martin. Photo courtesy of San Antonio.

Engine maintenance work at Lockheed Martin. Photo courtesy of San Antonio.

PART II: ONE CENTURY DOWN, ANOTHER TO GO (Read Part I Here)

So how do we tap into the momentum that already exists at Port San Antonio to create more local jobs in the multi-trillion dollar global aerospace market?

We must pivot by strengthening our foundation and adapting to the priorities of today’s commercial aerospace business. While this leading sector of the U.S. economy enjoys upbeat near-and long-term forecasts, it lives in a fiercely competitive market— one very different from the military aerospace work that took place at Kelly Air Force Base, the Port’s predecessor, and continues to be a mainstay of our economy.

Success in attracting commercial aerospace projects in the modern age, and the creation of new jobs in our region, hinges on four key factors:

1. Location (Big, Flexible and Well-Connected)

We’re already there.

Five global aerospace firms with operations at the Port – Boeing, Lockheed Martin, GDC Technics, Chromalloy, and StandardAero—have well-established histories here. They have flexible facilities that range from workshops to – in the case of Boeing – one of the world’s largest hangars, with nearly a million square feet. While our customers are still very engaged in military projects, they each have ample capacity in their existing facilities to add commercial maintenance work and significantly more jobs.

What’s more, the Port has 400 acres with direct access to the region’s largest runway— ideal sites for future hangar expansions. This type of “beachfront property” is rare. In fact, the Port’s is one of only a handful of locations in Texas that can accommodate a new large-scale aerospace operation accessible by aircraft.

The Port's 400 acres of available land along a large runway is one of only a handful of sites in Texas for major aerospace growth. Photo courtesy of Port San Antonio.

The Port's 400 acres of available land along a large runway is one of only a handful of sites in Texas for major aerospace growth. Photo courtesy of Port San Antonio.

The Port’s platform is bolstered by San Antonio’s strategic location at the center of North America. Another big plus is the Port’s direct access by Union Pacific and BNSF Railway cargoes. If sea access is necessary, the Gulf of Mexico is less than three hours away by truck, and our organization enjoys a great relationship with Port of Corpus Christi.

As an added bonus to aerospace firms that might do business internationally, the entire Port site is covered under a foreign-trade zone designation, allowing manufacturers to defer or altogether avoid import tariffs.

No doubt about it – from a logistics standpoint, we’re pretty tough competitors.

2. Talent

Far and away, a strong workforce is a decision makers’ top consideration when evaluating where to locate and grow an advanced technology facility. It’s certainly true in manufacturing and perhaps doubly so for aerospace, where domestic retirements are outpacing efforts to recruit the next generation of talent.

We can build more great facilities and tout our efficient, flexible logistics platform. But without well-prepared workers, industry will look elsewhere.

Here, Alamo Colleges has the community’s back.

St. Philip’s Southwest Campus – the Port’s neighbor – long has been the region’s primary center for nurturing the advanced skills that modern aircraft maintenance requires.

Of particular significance, the Alamo Aerospace Academy, established in 2001, is a national leader in workforce development. It’s no accident that two U.S. secretaries of education have personally toured the program in the last four years. And this year, the Academies received the Bellwether Award -- recognizing the program’s record of innovation and success from among 1,200 competing community college districts.

Alamo Aerospace Academy students. Photo Courtesy Port San Antonio

Alamo Aerospace Academy students. Photo Courtesy Port San Antonio

The Academy’s two-year curriculum offers free college-level education to area high school students who, as part of program requirements, participate in a hands-on paid internship with Port customers. (Yes, 17-year-olds gain invaluable experience by directly assisting in the maintenance, repair, and overhaul of real aircraft and engines.)

Students who participate in the dual-credit program are prepared to begin good aerospace jobs upon graduating high school. Their new employers often help cover ongoing studies. And several of the program’s nearly 300 graduates, almost all younger than 30, are now professionals in project management, finance, and other departments within their respective companies.

Industry’s support for the Academies is good business – giving employers an early start in identifying and nurturing the best and brightest talent. At Lockheed Martin’s local operations, for example, more than 30 percent of the site’s direct-hire employees are Academy graduates.

So what is the appropriate role for the Port and our larger community?

We must ensure that the Academies and similar innovative programs, which thoughtfully align education with industry’s immediate and long-term needs, have the resources to grow. In particular, we need to be prepared to scale these initiatives and give employers the confidence that, as they grow, we have a proven training platform, backed by enthusiastic community support, to prepare today’s and future generations for opportunities ahead.

3. Momentum and Consolidation

Advanced technology industries tend to grow around concentrations of similar enterprises. Being next-door to one’s potential competitor may seem counter-intuitive, but has many advantages.

The presence of industry clusters motivates a community, as it has Alamo Colleges, to focus resources to provide strong workforce development initiatives in support of those enterprises.

Proximity also enhances collaboration. This is certainly true of the aerospace industry, where firms depend on an array of subcontractors, suppliers and vendors. The closer those supporting industries are located, the better for business.

Thanks to the well-established group of aerospace customers at the Port, and additional industry leaders at San Antonio International Airport and elsewhere in the region, our community is holding its own as a center of aerospace excellence.

At the Port, over the past 20 years, our aerospace customers have developed an array of specialties.

Boeing’s site, for example, is among very few operations in the world that can support both military and commercial workloads – everything from maintaining workhorses like the C-17 to upgrading and retrofitting the newest generation of commercial airliners--the 787 Dreamliner.

Boeing's operations at the Port are among few large facilities worldwide that maintain both commercial and military aircraft. Photo Courtesy Port San Antonio.

Boeing's operations at the Port are among few large facilities worldwide that maintain both commercial and military aircraft. Photo Courtesy Port San Antonio.

Likewise, Lockheed, Chromalloy, and StandardAero’s local operations support both commercial and military engines.

GDC Technics, as it enters its second decade at the Port, has evolved from its core work as a luxury interiors specialist (now one of the largest in the world) and added avionics and airframe modifications to its repertoire.

Managers in both the commercial and military sectors really like this consolidation.

When that consumer is an aircraft operator in need of maintenance, repair, or overhaul services, San Antonio offers a one-stop center where different vendors – individually and in partnership – can fulfill many needs.

This maximizes efficiency and attracts new business and jobs. It shortens the time that an airplane is out of service, and enhances the bottom line of the airlines and cargo companies that own and operate them.

Top industry names already at Port San Antonio have put us in a great position.

Moving ahead, we will continue to help established businesses further diversify their offerings. And we’ll work to attract complimentary enterprises to the Port, strengthening our community’s reputation as the place and the people to trust with the care of a multi-million dollar aircraft.

4. Public Support

Attracting commercial aerospace is at the very top of growth plans for many communities across the country. Cities and states put forth multi-million-dollar packages that may include tax abatements, cost-free real estate, and cash.

The first three site selection criteria--location, workforce, and industry concentration--are far and away Port San Antonio’s and our community’s strengths.

These are the areas where we already have a competitive edge and will continue to bolster.

And when competing jurisdictions offer incentives, sometimes in the billions of dollars, we must be strategic.

The Port, which is operationally self-sustaining and has no taxing authority, can and does reach into its pockets to support projects that retain and grow jobs. In fact, it has done so to the tune of about $200 million so far.

The investment of an additional $60 million in public dollars over the past 20 years has provided an added boost to retrofitting former Air Force facilities to meet FAA standards and upgrade outdated infrastructure to attract commercial aerospace business.

Future growth of sizeable aerospace operations will require construction of new facilities at the Port, since existing hangars and workshops are almost fully leased.

As a public entity, the Port already has built-in advantages, including the fact that facilities owned and operated by the organization are tax exempt.

Additional financial support from the Port and its public partners, including monies applied toward construction of future facilities, are something that the Port would undertake together with its public stakeholders – the City of San Antonio and the State of Texas – evaluating specific opportunities on a case-by-case basis.

A thoughtful approach will help ensure that joint economic development packages between the Port and its stakeholders translate directly into good jobs for our community.

In It Together, For the Long Haul

In 1995, when news that Kelly Air Force Base would face closure hit San Antonians hard, the future was far from certain.

Two decades since that announcement and nearly 15 years since the base officially closed in 2001, the Port and the community can look back at an odds-defying record of success.

Thanks to thoughtful leadership in the months following the announcement, work that the Air Force handled was entrusted to private firms who retained much of the civilian workforce that the military employed. Those firms remain at the Port and are still humming along today.

Momentum continued and talent remained in San Antonio.

Today, the Port, our customers, and thousands of workers have benefited greatly from that foundation – not just the 3,000 aerospace workers, but the 9,000 other workers in the logistics, manufacturing, and Department of Defense sectors located at the Port.

We’ve evolved, grown, and met challenges together, with key support from public officials and educators.

The path forward holds significant opportunities to turn a robust center of aerospace excellence into a global contender.

The road that led us here took many meticulous steps. The best and biggest successes have always been joint efforts.

It is with this history in mind and with clear-eyed optimism about the future that the Port looks forward to doing our part in helping write the story of the next hundred years.

*Featured/top image: Engine maintenance work at Lockheed Martin. Photo courtesy of San Antonio. 

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