Honeywell 2014 Annual Report Download - page 11

monitor complex processes in many types of industrial settings as well as equipment that controls,
measures and analyzes natural gas production and transportation.
Performance Materials and Technologies
Our PMT segment is a global leader in developing and manufacturing advanced materials,
process technologies and automation solutions. PMT’s UOP business provides process technology,
products, including catalysts and adsorbents, equipment and consulting services to efficiently produce
gasoline, diesel, jet fuel, petrochemicals and renewable fuels for the petroleum refining, gas
processing, petrochemical, and other industries. PMT’s Process Solutions business is a pioneer in
automation control, instrumentation and services for the oil and gas, refining, pulp and paper, industrial
power generation, chemicals and petrochemicals, biofuels, life sciences, and metals, minerals and
mining industries. PMT’s Advanced Materials businesses manufacture a wide variety of high-
performance products, including fluorocarbons, hydrofluoroolefins, caprolactam, resins, ammonium
sulfate fertilizer, phenol, specialty films, waxes, additives, advanced fibers, customized research
chemicals and intermediates, and electronic materials and chemicals.
Competition
We are subject to active competition in substantially all product and service areas. Some of our
key competitors are as follows:
•Aerospace: Borg-Warner (automotive), Garmin, General Electric, Rockwell Collins, Thales and
United Technologies
•ACS: 3M, Johnson Controls, Schneider, Siemens and Zebra-Motorola
•PMT: Albemarle, BASF, Dow, Dupont, Emerson and Sinopec
Our businesses compete on a variety of factors, such as price, quality, reliability, delivery,
customer service, performance, applied technology, product innovation and product recognition. Brand
identity, service to customers and quality are important competitive factors for our products and
services, and there is considerable price competition. Other competitive factors include breadth of
product line, research and development efforts and technical and managerial capability. While our
competitive position varies among our products and services, we believe we are a significant
competitor in each of our major product and service classes. A number of our products and services
are sold in competition with those of a large number of other companies, some of which have
substantial financial resources and significant technological capabilities. In addition, some of our
products compete with the captive component divisions of original equipment manufacturers.
Aerospace Sales
Our sales to aerospace customers were 39%, 40%, and 41% of our total sales in 2014, 2013 and
2012, respectively. Our sales to commercial aerospace original equipment manufacturers were 6%,
7%, and 7% of our total sales in 2014, 2013 and 2012, respectively. In addition, our sales to
commercial aftermarket customers of aerospace products and services were 11%, 11%, and 12% of
our total sales in 2014, 2013 and 2012, respectively.
U.S. Government Sales
Sales to the U.S. Government (principally by our Aerospace segment), acting through its various
departments and agencies and through prime contractors, amounted to $3,693 million, $3,856 million
and $4,109 million in 2014, 2013 and 2012, respectively, which included sales to the U.S. Department
of Defense, as a prime contractor and subcontractor, of $2,792 million, $3,066 million and
$3,273 million in 2014, 2013 and 2012, respectively. U.S. defense spending decreased in 2014
compared to 2013. We do not expect our overall operating results to be significantly affected by any
proposed changes in 2015 federal defense spending due principally to the varied mix of the
government programs which impact us (Original Equipment Manufacturers’ production, engineering
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