The Aerospace and Defence market is strongly influenced by the expenditure of the government as one of the market’s largest customers. With the increased budget of the Ministry of Defence (now £33.4 billion), manufacturers are likely to enjoy a significant increase in sales. Despite this healthy state of affairs, the industry is not big enough for larger competitors and must look overseas to robust export markets in order to sustain long term profitability. Security concerns demand that it is a priority to source defence equipment from domestic companies, but economic concerns likewise demand that public spending must be cost effective. Consequently, companies must ensure that they compete effectively on cost and quality with big European competitors and abide by EU competition rules for procurement of ‘non warlike’ equipment. The cross-border collaborative nature of the aerospace sector means that UK companies seldom occupy a prime contractor or leadership role and in decision-making processes do not necessarily have the final say on policy or strategy, particularly where overseas Governments are involved. Whilst the aerospace sector is in comparatively robust health, there is an ever-present danger of being unable to attract or educate new blood on the one hand and, on the other, contraction to a point where there is no longer a viable skills base.