Rockwell Collins, a spin-off of
, makes aviation electronics and communication equipment for commercial and military aircraft. The company boasts that nearly every commercial cockpit contains something made by Rockwell Collins. It also provides flight simulation and training, MRO services, navigation, and surveillance systems. The company has three primary segments: commercial systems (avionics and in-flight entertainment systems for commercial aircraft); government systems (airborne/ground/shipboard communication systems with military applications and overhaul services); and information management services business (communications, systems integration and security solutions).
The government systems segment (42% of total sales) provides products for a variety of uses but they all have the common theme of design for use under rugged conditions constrained by challenges in relation to size, weight, and power. These products include satellite communications systems, handheld navigation devices, flight controls, helmet-mounted displays, and training systems.
The company's commercial systems segment (46%) provides systems and products for the original manufacturing, retrofitting, and upgrading of aircraft. Products include the Pro Line Fusion integrated avionics system, cabin management systems, head-up guidance systems, primary actuation systems, and simulators for crew training. The segment serves a range of customers, from the biggest aircraft makers in the world to owners of individual aircraft. Aftermarket products are sold through distributors and to regional airline operators.
Its information management services segment (12%) provides communications services, systems integration, and security services across the aviation, airport, rail, transit, and nuclear security markets to customers located around the world. Its customer base includes commercial airlines, business aircraft operators,
the US Federal Aviation Administration
(FAA), airport and critical infrastructure operators, and major passenger and freight railroads.
Rockwell Collins operates in countries including France, Canada, Germany, Japan, Australia, China, India, Italy, Spain, Singapore, Brazil, the United Arab Emirates, Saudi Arabia, the UK, and the US. Rockwell Collins makes more than 60% of its sales in the US.
Sales and Marketing
Rockwell Collins markets its systems, products and services directly to government systems and commercial systems customers through an internal marketing and sales force. The company also utilizes a worldwide dealer network to distribute its products and international sales representatives to assist with international sales and marketing.
The US government accounts for almost 30% of sales. Customers include the
Department of Defense
US Coast Guard
, civil agencies, defense contractors, foreign ministries, commercial air support manufacturers, and airlines.
In 2015 Rockwell Collins' revenue increased by 5% to peak at roughly $5.2 billion, a new company milestone. The historic growth for 2015 was fueled by additional revenue from acquisitions and a surge in sales within its information management services segment.
Rockwell Collins' profits also surged 14% to peak at a record-setting $686 million in 2015. In addition, the company's operating cash flow has steadily risen the last four years.
Joint ventures are an important element of the company's strategy for growth. It maintains 50-50 JVs with
for Data Link Solutions (serving the worldwide data link market);
for Vision Systems International (helmet-mounted cueing systems for the military fixed-wing market);
for Integrated Guidance Systems (weapons guidance and navigation products); and Quadrant Group for Quest Flight Training (aircrew training for the UK Ministry of Defense).
Rockwell Collins continues to execute its strategy to reshape its government systems portfolio to align with the changing dynamics of the defense environment. During 2014 Rockwell Collins divested two businesses: DataPath and KOSI. The decision was part of an overall strategy to reshape its government systems segment to focus on growing markets for the company's core products and services.
Mergers and Acquisitions
Rockwell Collins in both 2014 and 2015 achieved revenue milestones with the aid of key acquisitions.
In a historic announcement, Rockwell Collins in late 2016 agreed to acquire
in a transaction valued at $6.4 billion plus the assumption of $1.9 billion in debt. The major deal will largely expand the range of products that Rockwell Collins supplies to major commercial and business aircraft and broaden its customer base internationally.
In 2015 the company acquired International Communications Group (ICG), which provides satellite-based global voice and data communication products and services for the aviation industry, for $50 million. The deal broadened the company's flight deck and connectivity portfolio. Previously in 2015, Rockwell Collins acquired Pacific Avionics Pty. Limited, which provides technologies used for wireless information distribution. It made the purchase for $24 million as the acquisition further enhanced its cabin products and information management services portfolios.