This is the accessible text file for GAO report number GAO-07-1165R entitled 'U.S. Involvement at Major International Air Shows Principally Depends on Agencies' Missions and Aerospace Companies' Resources' which was released on October 22, 2007. This text file was formatted by the U.S. Government Accountability Office (GAO) to be accessible to users with visual impairments, as part of a longer term project to improve GAO products' accessibility. Every attempt has been made to maintain the structural and data integrity of the original printed product. Accessibility features, such as text descriptions of tables, consecutively numbered footnotes placed at the end of the file, and the text of agency comment letters, are provided but may not exactly duplicate the presentation or format of the printed version. The portable document format (PDF) file is an exact electronic replica of the printed version. We welcome your feedback. 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September 21, 2007: The Honorable Tom Davis: Ranking Member: Committee on Oversight and Government Reform: House of Representatives: The Honorable Michael Turner: Ranking Member, Subcommittee on: Information Policy, Census and National Archives: Committee on Oversight and Government Reform: House of Representatives: Subject: U.S. Involvement at Major International Air Shows Principally Depends on Agencies' Missions and Aerospace Companies' Resources: For years, the U.S. government has participated at international air shows, such as those in Paris, France, and Farnborough, United Kingdom, with federal agencies renting exhibit space to present program information, displaying aircraft, or providing assistance to U.S. aerospace companies seeking to showcase their businesses. Hosted by aerospace industry associations and foreign governments, these shows present opportunities for business networking and often serve as forums for announcing billions of dollars in contract awards. While large U.S. aerospace companies are generally well represented at these shows, the ability of small and medium-sized companies to participate is unclear. On the basis of your interest in understanding U.S. government and company involvement at major international air shows, we (1) identified federal agencies' participation as well as their support to U.S. companies at these shows since 2000 and (2) determined what factors affect small and medium-sized U.S. companies' decisions to participate. Scope and Methodology: To identify federal agency participation and support since 2000, we met with officials at the Departments of Defense (DOD), Commerce, and State; the Federal Aviation Administration (FAA); and the National Aeronautics and Space Administration (NASA)--the five federal agencies that are involved at major international air shows. We reviewed laws, policies, guidance, and other documentation pertaining to these agencies' participation and support at international air shows. We defined federal agency participation as activities that include transporting, displaying, staffing, or demonstrating exhibits and equipment, as well as agency officials sitting on panels or conducting meetings with company representatives and foreign officials. We defined agency support as providing resources or other assistance to U.S. aerospace companies to enable them to participate at air shows. However, we did not review general attendance at air shows that was not related to participation or support activities. To determine what factors led aerospace companies to participate, we interviewed 20 small and medium-sized companies--which we defined as those having fewer than 500 employees--based on their recent participation at major international air shows and their use of federal agencies' assistance. These companies represented a range of aerospace industry sectors, including components manufacturing; simulation and training; and maintenance, repair, and overhaul. The views of company representatives included in this report do not represent those of the entirety of small and medium-sized aerospace companies. We conducted our review from February 2007 through September 2007 in accordance with generally accepted government auditing standards. Results in Brief: Agencies' participation in and support to companies at major international air shows largely depend on the agencies' missions, with such activities funded by operations accounts or fees charged to companies. While DOD is the predominant U.S. agency participant at air shows, its presence is based on whether participation will contribute to its mission of advancing security cooperation, promoting interoperability of weapon systems, and demonstrating commitment to alliances or regions. Typically, DOD displays or demonstrates weapon systems, such as fighter aircraft, or meets with foreign military officials. DOD also provides support to U.S. companies by leasing military aircraft to them for use at these shows on a limited basis. Commerce is a key provider of support to U.S. companies participating at air shows because of its mission to open new markets and promote U.S. companies' products and services overseas. Commerce's support includes a range of fee-for-service programs, including product literature displays and business-to-business introductions, as well as business counseling services available at no charge. While FAA and NASA do not provide support to companies, they occasionally participate at air shows when it may advance a specific agency mission. The State Department provides diplomatic support to federal agencies and facilitates meetings between U.S. companies and foreign officials-- activities that the agency normally performs as part of its overseas mission. Because show participation and support are an integral part of agencies' missions, their costs are not budgeted separately from other mission activities. While only DOD and Commerce track direct participation costs, other agencies were able to estimate how much they spend for show participation. All five agencies pay for their costs from operations accounts or from fees charged for company support. For example, in 2005 and 2006, DOD spent approximately $2.4 million from its operations accounts to participate at air shows in Paris, France; Farnborough, United Kingdom; Singapore; Dubai, United Arab Emirates; and Santiago, Chile. Officials we interviewed from small and medium-sized companies identified a number of factors, including cost and sales opportunities, that influence their participation at air shows. One major factor is the high cost of sending employees and materials to international locations. Company officials indicated that their participation, which includes such activities as setting up information booths or establishing business contacts, generally does not result in a direct return on investment. While officials noted that their costs are typically greater than any sales that can be directly tracked to their show participation, they indicated that it is a business decision based on opportunities for promoting name recognition and fostering business relationships. Some companies paid fees to obtain Commerce's assistance at air shows, while others were unaware of Commerce's programs to assist small and medium-sized companies. Background: The air shows at Paris and Farnborough are preeminent and are held in alternating years. Other major air shows include those at Singapore, Dubai, and Santiago. Table 1 provides an overview of these five shows. Table 1: Overview of Five Major International Air Shows: First show: Show frequency; Paris: 1909: 7-day show held every other year; Farnborough: 1932: 7-day show held every other year; Singapore[A]: 1981: 6-day show held every other year; Dubai: 1989: 5- day show held every other year; Santiago: 1980: 6-day show held every other year. First show: Number of trade visitors; Paris: 1909: 153,920 trade visitors; Farnborough: 1932: 140,000 trade visitors; Singapore[A]: 1981: 34,300 trade visitors; Dubai: 1989: 35,000 trade visitors; Santiago: 1980: 40,000 trade visitors. First show: Foreign delegations[B]; Paris: 1909: 150 defense delegations from 60 countries and 40 civil delegations from 20 countries; Farnborough: 1932: 83 defense delegations from 43 countries and 40 civil delegations from15 countries; Singapore[A]: 1981: 153 delegations from 44 countries; Dubai: 1989: 60 military and 44 civil delegations; Santiago: 1980: 143 delegations from 21 countries. First show: Aircraft on display; Paris: 1909: 140; Farnborough: 1932: Over 100; Singapore[A]: 1981: n/a[C]; Dubai: 1989: 101; Santiago: 1980: 121. First show: Dollar amount of orders announced at shows; Paris: 1909: n/ a; Farnborough: 1932: Over $40 billion; Singapore[A]: 1981: $15 billion; Dubai: 1989: Over $21 billion; Santiago: 1980: n/a. Source: Data obtained from air show organizers and U.S. federal agencies. [A] Following the 2006 Asian Aerospace show at Singapore, the organizer relocated the show to Hong Kong. A new show is planned to be launched in Singapore in 2008. [B] Information on delegations varies for these shows and is included as available. [C] n/a indicates official information not available. [End of table] These shows serve as an opportunity for industry and government participants to display products and services to potential buyers and demonstrate aircraft to increase the public's awareness and understanding of aerospace technologies. Agencies' Participation and Support at International Air Shows Is Mission Driven, with Costs Funded by Operations Accounts or User Fees: U.S. agencies participate to varying degrees at international air shows based on their missions, and the cost of their activities is funded by operations accounts or user fees for certain support services. DOD and Commerce are the two key agencies that usually participate and provide support to companies at air shows, while FAA, NASA, and State participate to a lesser extent. Table 2 highlights these agencies' participation, support, and missions. Table 2: Federal Agencies' Participation, Support, and Missions for the Five Major International Air Shows: Federal agency: DOD: Commerce; Participation and/or support since 2000: Displays or demonstrates weapon systems and sets up information booths at most of the shows; leases weapon systems, such as fighter aircraft, on limited basis, to U.S. companies: Offers several programs for U.S. aerospace companies, for a fee, to assist companies in marketing goods and services at most of the shows; Agency mission for air shows: Advances security cooperation and technological interoperability with friendly nations: Supports U.S. companies' sales of goods and services abroad. Federal agency: DOD: NASA; Participation and/or support since 2000: Displays or demonstrates weapon systems and sets up information booths at most of the shows; leases weapon systems, such as fighter aircraft, on limited basis, to U.S. companies: Sends official delegations to some shows and has set up an exhibit on one occasion; Agency mission for air shows: Advances security cooperation and technological interoperability with friendly nations: Advances international cooperation and disseminates results of U.S. space exploration to the public. Federal agency: DOD: State; Participation and/or support since 2000: Displays or demonstrates weapon systems and sets up information booths at most of the shows; leases weapon systems, such as fighter aircraft, on limited basis, to U.S. companies: Assists agencies with show activities by facilitating entry into foreign countries and coordination with foreign officials; cohosts receptions at some shows for companies to build business relationships; Agency mission for air shows: Advances security cooperation and technological interoperability with friendly nations: Ensures U.S. government activities are consistent with foreign policy goals. Source: GAO analysis of agency statements and data. [End of table] DOD: Since 2000, DOD has participated at most of the five major air shows based on its mission of advancing security cooperation, promoting interoperability of weapon systems, and demonstrating commitment to alliances or regions. Officials stated that to foster coalition building with international partners, DOD has displayed weapon systems, disseminated information about systems' capabilities, and performed live demonstrations. Air show participation also provides U.S. military officials with opportunities to network with foreign counterparts. For example, U.S. military officials may attend numerous bilateral meetings, as many as 20, at a single air show. DOD determines which weapons to exhibit at upcoming shows, based on a multitiered process, which begins with U.S. embassy and combatant command officials providing DOD with a list of weapon systems, such as military aircraft, to be displayed. The combatant command charged with responsibility for the particular geographic region provides input on whether the display of such systems advances the political-military agenda for that region. These commands are responsible for providing the required resources to support the event and paying the cost to exhibit the system at the air show. As such, current military operational needs may restrict certain equipment from being exhibited at air shows. The Defense Security Cooperation Agency (DSCA) and the military services also assess the political-military situation of the country in which an embassy and a combatant command are seeking direct show participation. Finally, DSCA obtains approval for participation from DOD's Undersecretary of Defense for Policy. Since 2000, DOD has exhibited a range of aircraft at these shows, including the C-130J Hercules transport aircraft, UH-60A Blackhawk helicopter, and F-16 Falcon fighter aircraft. While DOD focuses on participating at major shows, such as Paris and Farnborough, the agency also considers the importance of smaller shows. For example, an Air Force official told us that participation at an air show in South Africa is gaining in importance for DOD's goal of providing regional support now that the agency has established the U.S. Africa Command. Also, DOD supports U.S. business by leasing equipment to defense companies that seek to demonstrate particular weapon systems and initiate sales to foreign nations. When a company requests an equipment lease for an air show, DOD officials review the political-military situation of the region, as well as equipment availability, to determine whether to grant approval. All costs associated with leasing the equipment are to be borne by the company, including transporting, fueling, and potential damage during use.[Footnote 1] For the 2006 show in Farnborough, the Air Force approved a lease to Lockheed Martin for the F-16 Falcon fighter aircraft, and for the 2005 Paris show, the Navy approved a lease of the F/A-18F Super Hornet strike fighter to Boeing. Army officials say they have approved very few leases because equipment is needed for ongoing military operations. On a limited basis, DOD supports U.S. businesses at international air shows by sending high- level officials to meet with potential buyers of U.S. equipment, provided such contracts promote technological interoperability for U.S. and foreign military equipment and strengthen the capabilities of coalition partnerships.[Footnote 2] Commerce: According to Commerce officials, the agency's participation at air shows is driven by its mission to promote the interests of U.S. businesses abroad by providing support to U.S. aerospace companies through a number of assistance programs. The agency's U.S. Commercial Service, within the International Trade Administration, offers these programs and activities to help U.S. companies, particularly small and medium-sized companies, increase international exposure at air shows, according to officials. Officials also noted that before approving the use of company assistance programs for an air show, Commerce uses its Trade Fair Certification Program to endorse an international air show organizer that will recruit U.S. exhibitors and manage an official U.S. pavilion. The certification program is a cooperative partnership among Commerce, industry associations, international trade show organizers, and foreign trade fair authorities. Commerce then initiates a range of show-related services, such as oversight and coordination of events and in-country site assistance to the show organizer. Show organizers are required to recruit small and medium-sized businesses and provide Commerce officials with a show floor booth to run operations, display materials, and conduct business counseling. Since 2000, Commerce has certified and supported eight trade show organizers.[Footnote 3] To encourage companies to participate at shows and use available assistance programs, Commerce utilizes International Trade Administration staff that identify and contact companies, including those that are new to the market, and distributes information through domestic and international trade events, news releases, and Web sites. In addition to the Trade Fair Certification Program, Commerce uses the following company assistance programs: Aerospace Product Literature Center aids small and medium-sized companies by disseminating company literature at an information booth staffed by Commerce personnel at air shows. This program typically serves 50 to 65 small and medium-sized U.S. companies at a single air show and is the most frequently provided program. The user fee charged to companies generally ranges from $600 to $650 per show. Aerospace Executive Service facilitates introductions and sets up meetings between U.S. companies and potential foreign customers. Commerce has provided this service to between 5 and 34 U.S. companies per show, charging fees ranging from $2,500 to $4,700. Companies have utilized this program at the Farnborough, Dubai, and Singapore air shows in recent years. Pathfinder Program is modeled after the Aerospace Executive Service and assists U.S. companies by providing customized program catalogues and a list of suggested foreign companies to meet with. This program has been used in lieu of the Aerospace Executive Service but does not set up meetings for participants. Since 2000, Commerce has offered the Pathfinder Program only once at the 2005 Paris air show for a charge of $2,950 per company plus $700 for each additional company participant. Showtime Program provides market analysis and counseling services to U.S. companies at major shows through a team of in-country market and industry specialists. There is no user fee for this service. Table 3 indicates Commerce assistance programs provided at the major shows since 2000. Table 3: Commerce Assistance Programs Provided Since 2000: Year: 2000; Air show: Farnborough; Trade Fair Certification: [Check]; Aerospace Product Literature Center: [Check]; Aerospace Executive Service: [Empty]; Pathfinder Program: [Empty]; Showtime Program: [Empty]. Year: 2000; Air show: Singapore; Trade Fair Certification: [Check]; Aerospace Product Literature Center: [Check]; Aerospace Executive Service: [Check]; Pathfinder Program: [Empty]; Showtime Program: [Empty]. Year: 2000; Air show: Santiago; Trade Fair Certification: [Empty]; Aerospace Product Literature Center: [Empty]; Aerospace Executive Service: [Empty]; Pathfinder Program: [Empty]; Showtime Program: [Empty]. Year: 2001; Air show: Paris; Trade Fair Certification: [Empty]; Aerospace Product Literature Center: [Check]; Aerospace Executive Service: [Empty]; Pathfinder Program: [Empty]; Showtime Program: [Empty]. Year: 2001; Air show: Dubai; Trade Fair Certification: [Empty]; Aerospace Product Literature Center: [Check]; Aerospace Executive Service: [Empty]; Pathfinder Program: [Empty]; Showtime Program: [Empty]. Year: 2002; Air show: Farnborough; Trade Fair Certification: [Check]; Aerospace Product Literature Center: [Check]; Aerospace Executive Service: [Empty]; Pathfinder Program: [Empty]; Showtime Program: [Empty]. Year: 2002; Air show: Singapore; Trade Fair Certification: [Check]; Aerospace Product Literature Center: [Check]; Aerospace Executive Service: [Check]; Pathfinder Program: [Empty]; Showtime Program: [Empty]. Year: 2002; Air show: Santiago; Trade Fair Certification: [Empty]; Aerospace Product Literature Center: [Empty]; Aerospace Executive Service: [Empty]; Pathfinder Program: [Empty]; Showtime Program: [Empty]. Year: 2003; Air show: Paris; Trade Fair Certification: [Empty]; Aerospace Product Literature Center: [Check]; Aerospace Executive Service: [Check]; Pathfinder Program: [Empty]; Showtime Program: [Check]; Year: 2003; Air show: Dubai; Trade Fair Certification: [Empty]; Aerospace Product Literature Center: [Empty]; Aerospace Executive Service: [Check]; Pathfinder Program: [Empty]; Showtime Program: [Empty]. Year: 2004; Air show: Farnborough; Trade Fair Certification: [Check]; Aerospace Product Literature Center: [Check]; Aerospace Executive Service: [Check]; Pathfinder Program: [Empty]; Showtime Program: [Check]; Year: 2004; Air show: Singapore; Trade Fair Certification: [Check]; Aerospace Product Literature Center: [Check]; Aerospace Executive Service: [Check]; Pathfinder Program: [Empty]; Showtime Program: [Check]; Year: 2004; Air show: Santiago; Trade Fair Certification: [Empty]; Aerospace Product Literature Center: [Empty]; Aerospace Executive Service: [Empty]; Pathfinder Program: [Empty]; Showtime Program: [Empty]. Year: 2005; Air show: Paris; Trade Fair Certification: [Empty]; Aerospace Product Literature Center: [Check]; Aerospace Executive Service: [Empty]; Pathfinder Program: [Check]; Showtime Program: [Check]; Year: 2005; Air show: Dubai; Trade Fair Certification: [Empty]; Aerospace Product Literature Center: [Check]; Aerospace Executive Service: [Empty]; Pathfinder Program: [Empty]; Showtime Program: [Empty]. Year: 2006; Air show: Farnborough; Trade Fair Certification: [Check]; Aerospace Product Literature Center: [Check]; Aerospace Executive Service: [Empty]; Pathfinder Program: [Empty]; Showtime Program: [Check]; Year: 2006; Air show: Singapore; Trade Fair Certification: [Check]; Aerospace Product Literature Center: [Check]; Aerospace Executive Service: [Check]; Pathfinder Program: [Empty]; Showtime Program: [Check]; Year: 2006; Air show: Santiago; Trade Fair Certification: [Empty]; Aerospace Product Literature Center: [Empty]; Aerospace Executive Service: [Check]; Pathfinder Program: [Empty]; Showtime Program: [Empty]. Year: 2007; Air show: Paris; Trade Fair Certification: [Empty]; Aerospace Product Literature Center: [Empty]; Aerospace Executive Service: [Empty]; Pathfinder Program: [Empty]; Showtime Program: [Check]; Source: GAO analysis of Commerce data. [End of table] On a limited basis, Commerce also arranges for officials to advocate on behalf of U.S. businesses competing for foreign contracts, including those participating at international air shows. Although not specific to air shows, this advocacy can include U.S. embassy and consulate assistance, as well as communications from senior-level U.S. government officials to foreign government officials. FAA: FAA participates at many air shows as part of its mission to promote aviation safety and the harmonization of international aviation standards by conducting bilateral and multilateral meetings with foreign aviation counterparts. Sometimes, FAA will send an employee to distribute agency information at its own exhibition space or at Commerce's booth. In other cases, FAA pays Commerce a fee to display and distribute materials at a show. Since 2000, the agency has regularly participated at the Paris show because it is the largest and at the Singapore show because it is in the fast-growing Asia-Pacific region. The agency has also participated at Santiago and Dubai. According to agency officials, FAA does not provide support to companies seeking to participate at international air shows. NASA: NASA officials stated that the agency participates at air shows to support the agency's mission of advancing international cooperation and disseminating the results of U.S. space exploration to the public. Since 2000, NASA has taken part in two international shows--Farnborough and Paris--to disseminate information on the completion of the International Space Station and future exploration efforts as directed by a 2004 presidential policy statement that introduced a new vision and priorities for the agency. At the 2004 Farnborough show, NASA had an exhibit to describe this new vision, and at the subsequent Paris Air Show in 2005, NASA officials said they met with foreign international space program officials but did not set up an exhibit. In addition, these officials told us that NASA does not provide support to companies seeking to participate at international air shows. State: According to State officials, as part of the agency's mission to ensure that international air show participation is consistent with overall foreign policy objectives, agency and embassy staff facilitate coordination of Commerce and DOD participation and provide support to U.S. government officials to these shows. These activities are coordinated through State's International Cooperative Administrative Support Services. For example, State provided country clearances and logistical support for a NASA official participating at the 2006 Farnborough air show. At some air shows, State cohosts an ambassador's reception with U.S. industry associations, such as the Aerospace Industry Association, to build business relationships. In addition, officials noted that when approved through a Commerce, DOD, and State interagency process, State officials attend the shows to advocate on behalf of U.S. companies competing for foreign contracts. Cost of Agency Participation and Support: We found that the five agencies in our review do not receive separate budget line item appropriations for international air show participation, as participation and support are integral parts of agencies' missions. While DOD and Commerce track costs associated with their direct participation, other agencies were able to estimate some of their air show costs, even though they do not track these separately from other mission activities. DOD collects data on expenditures from combatant commands based on estimates of air show participation and support. These costs include travel for agency personnel, exhibition expenses, and transportation costs for military aircraft exhibited at the show and are paid out of existing operations and maintenance or other budget accounts. Table 4 shows that combatant commands reported a total of $7.1 million between 2000 and 2007 for air show participation and support.[Footnote 4] Table 4: DOD Combatant Command Reported Costs for Major Air Shows: Year 2001: Air show: Farnborough, Singapore, Santiago; Cost (U.S. dollars)[A]: $336,873, $501,000, $531,182. Year: 2001; Air show: Paris, Dubai; Cost (U.S. dollars)[A]: $443,911, $21,500. Year: 2002; Air show: Farnborough, Singapore, Santiago; Cost (U.S. dollars)[A]: $394,237, Data not available, $193,709. Year: 2003; Air show: Paris, Dubai; Cost (U.S. dollars)[A]: $356,069, $403,631. Year: 2004; Air show: Farnborough, Singapore, Santiago; Cost (U.S. dollars)[A]: $663,747, $415,930, $194,910. Year: 2005; Air show: Paris, Dubai; Cost (U.S. dollars)[A]: $395,484, $1.1 million. Year: 2006; Air show: Farnborough Singapore Santiago; Cost (U.S. dollars)[A]: $372,184, $327,147, $253,120. Year: 2007; Air show: Paris; Cost (U.S. dollars)[A]: $239,925. Total of available data: $7.1 million. Source: GAO analysis of DSCA and DOD combatant command data. [A] Not adjusted for inflation. [End of table] Commerce tracks the cost of its direct air show participation and support and tracks the fees charged to each company for programs offered at certified shows. According to Commerce officials, these fees generally offset the agency's direct cost. Officials stated that they require a minimum level of company participation to ensure that fees charged cover their expenses. However, officials noted that such fees would not include the cost of many show activities related to participation, such as agency and personnel resources expended in preparation for the show. For the three fee-based company assistance programs Commerce provided at the five major air shows from 2001 through 2006, agency officials identified total costs of $399,598 for which the agency collected $583,043 in fees from companies.[Footnote 5] Although FAA and NASA officials said their agencies do not routinely track air show participation separately from other mission activities, they provided estimates on their total cost, where available. FAA officials estimated that the agency has spent approximately $107,000 at over half of the major air shows it has participated at since 2001 for travel and registration fees for FAA delegations to the show, but were unable to estimate costs for the remaining shows. NASA officials estimated $729,350 for participation costs at the 2004 Farnborough air show. This estimate included costs for booth space, exhibit design and construction, and literature distribution. The State Department did not provide any cost figures because its participation is integrated into its overall mission activities and is not separately tracked. Small and Medium-Sized Companies Consider Cost and Sales Opportunities When Participating at Major International Air Shows: According to officials at the small and medium-sized companies we interviewed, their decision to participate at air shows is based on a number of factors, including cost and potential sales. However, these officials generally could not identify a direct return on investment resulting from their participation. For these companies, participation included such activities as renting space and setting up information booths, displaying sample products, and prearranging meetings with potential customers at shows. Company officials told us that they may have a booth at some shows and at others they may opt just to meet with potential customers. One company leased a large booth space and sent a significant number of its employees to share information about their company's products. More than half of the company officials we spoke with noted that the high cost of sending employees and materials to international air shows is a major factor for determining whether and to what extent they participate. Several companies indicated that their average cost of participating ranged from $5,000 to $15,000 per employee. Generally, this cost included travel, hotel, meals, and entertainment but did not include booth rental and assembly and shipping of materials to international locations. Some companies said additional expenses that are not captured include the time employees are away from other work activities that is spent preparing for, traveling to, and participating at shows. Another major factor companies consider is the potential that participation will generate sales. Although most companies were unable to identify specific sales of goods or services resulting from show participation, they made a business decision to participate in an effort to generate sales by promoting name recognition and goodwill of the company. Even companies that subsequently sell to contacts made at shows are uncertain about attributing those sales to show participation. Nevertheless, some companies view participation at major international air shows as necessary for being recognized as an active player in the aerospace industry. Some stated that nonparticipation puts them at a disadvantage with competitors that do participate. While at shows, some companies split their time between maintaining relationships with current clients and building relationships with potential customers. For example, officials at one small company we met with said that they recently participated at an air show to maintain the company's relationship as a supplier to a larger exhibiting company, even though the company did not expect to generate any direct sales from participating. Companies also considered other factors when participating at air shows. Some companies were more likely to participate at air shows if others from the same aerospace industry sector were also present. For example, companies that provide interiors for private and corporate jets may not be interested in shows that are dominated by military and large commercial manufacturing companies. Most of the companies we interviewed attend the Paris and Farnborough shows. Fewer companies attend the Singapore, Dubai, and Santiago shows and either already have a company presence in the region or have a desire to move into the region. Figure 1 shows the frequency and type of participation by these companies at the major air shows. Figure 1: Overview of 20 Small and Medium-Sized Companies' Participation at Major International Air Shows, 2000-July 2007: This is a bar chart and text describing the number of companies participating in air shows. There were 4 in Santiago, 11 in Dubai, 12 in Singapore, 17 in Farnborough, and 16 in Paris. [See PDF for image] Source: GAO analysis of company data. [End of figure] The majority of the companies we interviewed were aware of Commerce's air show support programs and activities and often paid the applicable fees to use these programs. For these companies, the programs frequently supplemented other forms of participation. For example, instead of sending employees to both conduct meetings and distribute literature, one company's employees were free to conduct meetings and make new contacts while also having the company's literature distributed through Commerce's Aerospace Products Literature Center. Some companies utilized Commerce's Aerospace Executive Service to facilitate foreign business contacts and arrange meetings at the shows. Company officials that use these services told us that they were generally satisfied. None of the company officials we spoke with leased DOD equipment, which has generally been leased to larger companies, according to DOD data. Agency Comments: We provided a draft of this letter to DOD, Commerce, State, the Department of Transportation, and NASA for comment. Commerce and State provided technical comments, which we have incorporated as appropriate. * * * * * *: As requested by your office, unless you publicly disclose the contents of this report, we plan no further distribution of it until 30 days from the date of this letter. At that time, we will send copies to the Secretaries of Defense, Commerce, State, and Transportation; the Administrator of NASA; and interested congressional committees. We will also make copies available to others upon request. In addition, this report will be available at no charge on GAO's Web site at [hyperlink, http://www.gao.gov]. Should you or your staff have any questions concerning this report, please contact me at (202) 512-4841 or at CalvaresiBarrA@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. Key contributors to this report were John Neumann, Assistant Director; Angela D. Thomas; Najeema Davis Washington; Brent Helt; Lily J. Chin; and Alyssa Weir. Signed by: Ann Calvaresi Barr: Director, Acquisition and Sourcing Management: [End of section] Footnotes: [1] We did not assess whether DOD incurred any leasing costs that were not paid for by companies. [2] DOD guidance specifies when agency officials may support U.S. companies competing for foreign contracts. [3] While the official U.S. pavilion at the Paris Air Show is not part of the Trade Fair Certification Program, it is operated under the authority of the Department of Commerce and organized and managed by a contractor. Nevertheless, Commerce offers its complete range of business services at the Paris show. [4] These costs include participation as identified by the combatant commands and military services, but do not include other defense agencies' participation, such as the Missile Defense Agency or the National Geospatial-Intelligence Agency. These agencies separately reported that they spent $168,639 and $22,564.17, respectively, for their participation at major international air shows since 2000. [5] Fees collected in excess of costs are retained in a Commerce trust fund to be used for International Trade Administration activities. GAO's Mission: The Government Accountability Office, the audit, evaluation and investigative arm of Congress, exists to support Congress in meeting its constitutional responsibilities and to help improve the performance and accountability of the federal government for the American people. GAO examines the use of public funds; evaluates federal programs and policies; and provides analyses, recommendations, and other assistance to help Congress make informed oversight, policy, and funding decisions. GAO's commitment to good government is reflected in its core values of accountability, integrity, and reliability. 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