Why Hanwha Aerospace homed in on Connecticut as U.S. base

Industry

Published: 01 Jul. 2024, 17:30 Updated: 01 Jul. 2024, 18:29

Why Hanwha Aerospace homed in on Connecticut as U.S. base

Connecticut State Rep. Liz Linehan talks during an interview with the Korea JoongAng Daily at Hanwha Aerospace USA headquarters in Cheshire, Connecticut, on June 26. [HANWHA AEROSPACE USA]

[INTERVIEW]

CHESHIRE, Connecticut — Anchored by prominent jet engine makers like Pratt & Whitney, the U.S. state of Connecticut serves as a central hub for the aerospace manufacturing industry, with more than a quarter of the world's aircraft engine and parts makers located in the state.

With a part of the state nicknamed the "Aerospace Alley," abundant incentives and industry-dedicated laws also guided Hanwha Aerospace, a Korean engine parts maker, to settle down there to expand its foothold with global clients.

Connecticut State Rep. Liz Linehan, who recently led the Korean press tour of the Hanwha Aerospace USA manufacturing facility in Cheshire, Connecticut, emphasizes government funding and collaboration with academics as an essential prerequisite to make Korea a leader in the global aerospace scene, particularly with the latest efforts for a self-developed aircraft engine.

“Connecticut’s 'Aerospace Alley' was created by the industry, not by the government, where the manufacturers in the sector got together pursuing collaboration and asked for the government’s help,” Linehan said during the interview.

“Connecticut is educating governors and legislators to better support aerospace firms regardless of the financial aid and fostering related experts."

Connecticut's "Aerospace Alley" [HANWHA AEROSPACE]

Just like California’s “Silicon Valley,” Connecticut's Aerospace Alley is home to hundreds of aircraft engine makers and parts manufacturers, such as Pratt & Whitney and Sikorsky Aircraft.

Hanwha Aerospace in 2019 joined the cluster by acquiring 100 percent of Connecticut-based EDAC Technologies for $300 million. Hanwha currently has four manufacturing sites in the state, and has five major international aircraft engine makers as clients: Pratt & Whitney, General Electric, Rolls-Royce, Safran and Mitsubishi.

Paul Lavoie, the chief manufacturing officer for Connecticut, talks during an interview with the Korea JoongAng Daily at Hanwha Aerospace USA headquarters in Cheshire, Connecticut, on June 26. [HANWHA AEROSPACE USA]

“The programs Hanwha made to put [private and public partnerships] together — I believe it’s the first in Connecticut for the recruitment and retention of new workers — have gone so above and beyond what is the norm, not only in this area, but I think across the country,” said Linehan.

Connecticut is the only U.S. state to have a governor-led Office of Manufacturing to focus on making incentive packages and funding programs for manufacturers to meet their needs. The state also has the position of Chief Manufacturing Officer (CMO), which is appointed by the governor, to carefully and closely listen to the sector players.

“Over 25 percent of aircraft engines produced in the entire United States is made in the state of Connecticut,” said CMO Paul Lavoie. The state also established the Manufacturing Innovation Fund, "the only fund of its kind in America," that grants all firms — even small manufacturers with 100 employees or fewer — up to $250,000.

From left, Paul Lavoie, the chief manufacturing officer for Connecticut, Jessica Taylor, executive director of Aerospace Components Manufacturers, Connecticut State Rep. Liz Linehan, Luz Amaya, associate professor at Central Connecticut State University, and David Broderick, professor at Central Connecticut State University, take a photo at an event commemorating the fifth anniversary of Hanwha Aerospace USA's entry into the U.S. engine parts market on June 25 at the company's headquarters in Cheshire, Connecticut. [HANWHA AEROSPACE USA]

The state in 2014 passed the Connecticut Aerospace Reinvestment Act, which offers massive incentives when companies invest more than $100 million.

It also provides various vouchers, up to $100,000, when companies install new equipment and infrastructure to upgrade their manufacturing facilities. A total of 106 aerospace firms received the vouchers last year, according to the state, with around four times the aid reinvested there to upgrade manufacturing.

The partnership between companies and the academic field also contributed greatly to making the state the leader in the aerospace industry.

“The biggest problem of the state about 15 years ago was losing talent,” Linehan said. “But with Hanwha, we don’t really have that issue anymore; they understand the importance of talking to workers on how to maintain employee loyalty and how to become a real partner in the community.”

Hanwha Aerospace USA's manufacturing facility in the city of Cheshire, Connecticut. The facility, which is also the headquarters of Hanwha Aerospace USA, has more than 280 employees. [HANWHA AEROSPACE USA]

Hanwha Aerospace invested $200,000 in Central Connecticut State University to establish an engineering design lab at the school. With close partnerships with nearby educational institutions, Hanwha has hired around 100 technicians from nearby universities and high schools so far.

“It’s an industry-led initiative, supported by the government as having somebody within the government that is paying attention to the manufacturing,” Linehan said. “Every single day, the Manufacturing Office is working with 4,638 manufacturers in Connecticut to support them, to help them grow and to thrive here in the state.”

Each manufacturing job brings $270,000 in economic value to Connecticut. The U.S. state currently has around 160,000 manufacturing jobs, and of them, 37,000 are at engine-related companies.

Vito Moreno, a professor at the University of Connecticut, speaks about Hanwha's future as an aircraft engine maker during an interview with the Korea JoongAng Daily on June 27. [HANWHA AEROSPACE USA]

Aerospace-related jobs generated $6.6 billion in annual GDP in 2022, creating 15,500 new jobs while making up 10 percent of Connecticut’s total GDP.

Vito Moreno, a professor at the University of Connecticut who previously worked as an engineer at Pratt & Whitney for 44 years, also pinpointed the government's role in aiding Hanwha Aerospace to evolve from a parts supplier to an engine maker.

"It's challenging but not impossible if it is backed by the government's funding in terms of supporting basic research, which helps not only Hanwha but universities that work on tech that is going to be complementary to what the company needs,” Moreno said.

“It’s important to pick a niche in terms of where Hanwha especially wants to make investments, like how Pratt & Whitney focused on substantial cost savings and efficiency when its gear turbofan has become so successful,” Moreno added.

BY SARAH CHEA [chea.sarah@joongang.co.kr]