The Industry TodayThe space race and the cold war both created incentives for the United States and the USSR to promote their
aerospace industries, and in the 1980s they led the world in overall accomplishment, although Japan and several European nations possessed equal
technological skills in many areas. The global aerospace market grew steadily in the 1980s, despite slowed U.S. payload sales caused by the Space Shuttle accident that destroyed the Challenger in 1986. Although some U.S. and European launch programs experienced setbacks in the 1980s because of temporary booster failures, rocket-based space launches remain vital to the space
industry. By the 1990s, the European rocket Ariane had gained a 50% share of all launches, and in the United States there was more reliance on private firms. With the Soviet collapse, the formation of the Commonwealth of Independent States (CIS) created new opportunities for numerous agreements between CIS bureaus and aerospace companies from the United States and elsewhere.With cold war hostilities fading, those parts of the aerospace industry devoted to military aerospace began to shrink rapidly in the early 1990s. In Europe, nationalized industries became increasingly privatized, accompanied by mergers to control excess production capacity and make products more competitive in the world market. In the United States, similar mergers involved the sale of the General Dynamics fighter plane division to Lockheed, the purchase of General Electric's space division by Martin Marietta, Boeing's acquisition of McDonnell Douglas in 1996, and the merger of Lockheed and Martin Marietta in 1997.In the mid-1990s a sluggish world economy and decline in passenger travel contributed to a cloudy picture, and many companies in the aerospace sector sought new markets in electronic systems such as air traffic control, navigation, and radar equipment; others attempted to diversify into nonaerospace ventures that would allow them to utilize the technological expertise they had gained in the aerospace industry. In the United States, military aerospace began a slow recovery toward the end of the decade, as the Pentagon sought to maintain its technological edge. Aerospace development in Russia, however, seemed to have come to a dead halt. Even the Mir space station, showcase of the Russian space program, was experiencing difficulties by 1997.