Honeywell Aero CEO Endorses GE's $12B CPP Deal, Signals More In-Sourcing

The chief executive of Honeywell Aerospace on Tuesday described GE Aerospace’s planned acquisition of castings manufacturer Consolidated Precision Products (CPP) as a positive development for the sector, signaling a wider industry move toward securing supply chains through vertical integration.

A Positive View on Consolidation

Speaking at the Morgan Stanley Laguna Conference, Honeywell Aerospace CEO Jim Currier stated that GE Aerospace's proposed $12 billion deal to acquire CPP would benefit the industry. He clarified that Honeywell does not directly compete with GE for CPP's services and that there is no portfolio overlap.

"Actually, I view that as being a positive for the industry overall," Currier said. "The type of parts that we receive from CPP are very different than the type of parts that GE receives from them."

GE Aerospace announced the deal earlier this month as a strategic move to address persistent supply bottlenecks for critical jet-engine components.

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In-Sourcing Amid Supply Chain Strain

The acquisition is indicative of a larger trend where aerospace giants are either buying smaller parts manufacturers or bringing production capabilities in-house. This strategy aims to stabilize supply chains that are struggling to keep pace with strong demand from aircraft manufacturers seeking to ramp up commercial jet production.

Currier noted that Honeywell Aerospace has been actively pursuing a similar strategy for the past two years. The company has been bringing core technologies and manufacturing capabilities back in-house, reversing a trend of outsourcing that occurred between 2010 and 2019.

Looking ahead, Currier suggested this initiative is far from complete. "But is there more to be done relative to that? Absolutely," he said, adding that he sees opportunities for further in-sourcing in both the short and long term.