Southern California's aerospace industry, long in decline, begins to stir

Samantha Masunaga

When Tim Buzza joined McDonnell Douglas Corp. in the late 1980s and worked on the C-17 cargo plane, lots were so jammed that workers often had to park as much as a mile from the Long Beach plant and take a shuttle bus.

Last year, the C-17 production line shut down, ending the last large aircraft assembly operation in the region. Today, Buzza, 52, works on the old Douglas property, but for Virgin Galactic, billionaire Richard Branson’s space start-up.

Southern California is a long way from its aerospace glory years. Employment today is about one-third of what it was in 1990.

But analysts and industry leaders believe that the sector is poised to grow again, behind a new generation of entrepreneurial private space companies like SpaceX in Hawthorne and Virgin Galactic, and defense projects such as the B-21 long-range strike bomber, which could bring thousands of jobs to the area.

“From the peak in the late ‘80s, we’re at a fraction of what it was then,” said Jim Adams, principal with PricewaterhouseCoopers Strategy&. “But at the same time, the aerospace and defense sector in Southern California is far from dead.”

Southern California — with its ideal climate, open land and high-powered universities — has been a major player in the aerospace industry since the early 20th century.

In the 1920s, more than 25 airframe and aircraft engine makers set up shop in the area, and companies like Carson-based Ducommun Inc. supplied aluminum to early aircraft like Charles Lindbergh’s Spirit of St. Louis.

Over the course of World War II, Southern California aircraft manufacturing plants employed 2 million people and built 300,000 planes, according to the book “Blue Sky Metropolis: The Aerospace Century in Southern California.”

Douglas Aircraft, for example, churned out more than 100 C-47 cargo planes, A-20 attack bombers and B-17 bombers each week.

With the advent of the Cold War, Southern California became the nation’s hub for high-tech weapons research. Simon Ramo, co-founder of aerospace giant TRW Inc., pioneered the development of the U.S. intercontinental ballistic missile system, first in a former barbershop in Westchester, then in a former Catholic church in Inglewood.

In the heyday of the 1960s space program, North American Aviation’s Downey facility scaled up to 25,000 workers to build the Apollo command module.

It's hard to overstate the extent to which postwar Southern California was built on defense spending. In his definitive account of the period, "Golden Dreams: California in an Age of Abundance, 1950-1963," Kevin Starr wrote: "The Department of Defense awarded one-quarter of all its contracts to California in the 1950s. Between 1952 and 1962, the Department of Defense funneled more than $50 billion into California, twice the amount received by any other state."

“You had this kind of cauldron of intellectual and entrepreneurial ferment,” said Ron Sugar, former chief executive of Northrop Grumman from 2003 to 2010. “It was really remarkable.”

Employment surged again when President Reagan launched a new military race with the Soviet Union. More than 1,000 Northrop workers swarmed over B-2 bomber production lines in Palmdale.

But the industry ebbed as the Cold War ended and Pentagon spending slumped. Companies consolidated. Hundreds of thousands of workers were laid off.

Defense giants like Lockheed Corp. and Northrop Grumman Corp. later uprooted their headquarters from Southern California to move closer to military and intelligence customers in the Washington, D.C., area.

Today, the region’s private aerospace industry employment is down to 92,000, compared with 273,000 in 1990.

NASA astronauts Charles Conrad Jr. (commander), left, Richard Francis Gordon Jr. (command module pilot) and Alan L. Bean (lunar module pilot) during a spacecraft checkout at the North American Rockwell Space Division in Downey in September 1969.

NASA astronauts Charles Conrad Jr. (commander), left, Richard Francis Gordon Jr. (command module pilot) and Alan L. Bean (lunar module pilot) during a spacecraft checkout at the North American Rockwell Space Division in Downey in September 1969. (NASA / Getty Images)

“There’s always been this cyclical nature to the industry,” said Peter Westwick, an adjunct professor of history at USC and editor of “Blue Sky Metropolis.” “It’s not as big as it was 50 years ago, but there’s still a substantial footprint here.”

The industry is now more diverse. Big programs include space launch-service providers and various satellite makers as well as drone manufacturers, such as Monrovia’s AeroVironment Inc.

The drone industry, in particular, is one of Southern California’s new strong points.

AeroVironment has emerged as the largest supplier of small, unmanned aircraft systems to the Pentagon, and spy drones such as Global Hawk and Triton are assembled by Northrop in Palmdale. Boeing’s unmanned undersea vehicles are made at its Phantom Works facility in Huntington Beach.

A more diverse customer base may help smooth the notorious employment downturns, which were usually driven by federal budget cuts or the end of big contracts. SpaceX, Virgin Galactic and Los Angeles-based launch company Rocket Lab have all filled their satellite-launch manifests with both government and commercial contracts.

 “It won’t be the gold rush it was during Apollo or the space shuttle,” said Greg Autry, assistant professor of clinical entrepreneurship at USC. “But it’s much more sustainable.”

Billionaire-backed firms like Elon Musk’s SpaceX, Branson’s Virgin Galactic and Microsoft co-founder Paul Allen’s Vulcan Aerospace have their