Aerospace Industry News

Some notable achievements he mentioned to AAAI included: a $50m extension of airframe business to Hawker de Havilland from the Boeing Aircraft Company; the formation in NSW of Westland Pacific Pty Ltd to develop a high technology base in Australasia; orders for the overhaul of flight control systems by Lucas Aerospace and from Airbus Industries.

Mr Clyde also said that a number of other NSW companies are presently following up prospective orders in areas of light and ultralight aircraft, advanced composites, hydraulic equipment, radar antennas, cathode ray tubes, displays, etc. He noted that, besides these specific business transactions, another pleasing feature of the Air Show was the opportunity it gave companies to promote their products and services in a highly professional manner to both local and overseas interests. As a result of the Air Show, the Australian aerospace industry has certainly achieved increased international recognition.

Mr Barry Noonan of the Victorian Department of Industry Technology and Resources which coordinated the most impressive Victorian exhibit at the Show, has advised that Victorian companies made significant breakthroughs at ABAS. Orders worth $1. 2m have been placed and larger orders are in the process of being negotiated. Starch International Ltd is now negotiating for the construction of a Boeing 747 hangar in Malaysia with prospects for others. Pyron Pty Ltd is discussing sales of its fire suppression equipment with British Aerospace PLC of the UK, FMC Corporation of the USA and Agusta of Italy. Aviation Acrylics Pty Ltd is hopeful of winning contracts for its composite materials, especially window panels.

Seaim ‘88

The Australian South East Asia Industry Mission (SEAIM ’88) which visited Indonesia, Malaysia, Singapore, Thailand and the Philippines late last year represented the first joint Government/ Industry mission to promote Defence related sales in the region. It was a follow up to the previously announced relaxing of restrictions on the export of Defence related products from Australia and the package of assistance measures announced by the Minister for Defence.

Peter Lister, Corporate Marketing Manager of Hawker de Havilland and the current Chairman of AAAI, was the industry leader of the mission under the overall leadership of Major General John Coates the Assistant Chief of the Defence Force (Policy). He reports that, from the aerospace industry’s point of view, the mission was a considerable success. Everybody was well aware of the strength of the competition to be overcome and the protracted negotiations necessary to clinch an aerospace or defence sale. Therefore the first need was to underline to potential purchasing decision makers in the region that Australia had entered the Defence export arena and had capabilities and products worthy of further examination and consideration.

Judging by the attendances at the seminars held by the Mission, the questions asked and the enquiries received in this regard, the Mission was most successful. But t0 sell major items of Defence aerospace equipment into SE Asia requires more than just good capabilities or products. Quite simply, it depends on an ability to provide a competitive soft loan package as well.

Until the Australian Government is prepared to match the financial packages provided by the Governments of Australian industries’ international competitors, there is not much prospect of selling major equipments.

On the other hand, Peter Lister reports that support services associated with major equipments-whether these be in the area of maintenance, upgrading, modifying or training, are in demand by the countries of the region. Australian aerospace companies willing to invest in facilities to provide these services, in Mr Lister’s opinion, cannot do other than write substantial business.

Peter has provided the following comments on the prospects for Australian Aerospace companies in the region:

Singapore: The mix of Singapore Government and international aerospace companies in Singapore means that their operations compete against those of the Australian industry across almost the whole spectrum of aerospace activities. However there appear to be some areas where the Singapore industry does not have sufficient capacity-avionics being an example. There are also close business connections between Singapore and China which may be capable of being exploited by Australia. Indonesia: The desire to develop in-country programmes is obvious, even to the short-term business visitor. Therefore Australian companies wanting to become involved in aerospace projects in Indonesia will need to invest in the country. The major opportunities appear to be in relation to engine overhaul and component refurbishment programmes.

IPTN continues to develop its capabilities to manufacture aircraft components and to assemble aircraft at Bandung. Defence cooperation programmes involving Australia and Indonesia are tailing off with the last major aerospace programme being C-130 engine maintenance facilities for the Indonesian Air Force. In summary regional maintenance requirements will see the major competition/cooperation between the Australian and Indonesian aerospace industries.

Philippines: The Philippines economy is gradually turning around and it is significant that investment levels are rising, with over two thirds of new investment being from Philippino funds. The local aerospace industry is in the process of being restructured with the aim at creating centres of excellence in avionics, airframes and engines.

Whilst opportunities do exist for Australian aerospace companies (and indeed several are very much involved in the Philippines), it is notable that countries such as Italy and Spain are offering to fund cooperative programmes.

Malaysia: AAAI members will be aware that the Thatcher Government has recently committed substantial long-term loans for Defence equipment purchases from Malaysia. This practice is, of course, not confined to England. Canada and Germany are currently very active in the region. Once again opportunities for the Australian industry are most likely to exist at the fringes of these major purchases.

Thailand: Aviation maintenance requirements are seen as the major opportunity for doing business in Thailand. It should be recognised that Thai policy seeks to retain the work in Thailand, making long-term involvement unlikely unless investments are made in Thailand. Aircraft sales in Thailand are, of course, subject to soft loan funding and indeed, it is interesting to note the recent entry of China into this market in Thailand for jet training aircraft.

Conclusion: Missions of the nature of SEAIM ’88 are of positive value to AAAI members as the attendance at the seminars was generally above expectations. The Defence and Austrade officers {both on the mission and at the Embassies and High Commissions) made very substantial efforts to organise the seminars and they obviously succeeded in producing excellent results.

Most industry members were pleased with the level and quality of enquiries however (for major projects) the requirement for soft loan funds remains. Meanwhile maintenance programme growth in SE Asia represents a major business opportunity for Australian aerospace companies.

The success of the mission has meant that further overseas missions are being proposed for 1989 and 1990. Such missions would be most beneficial to Australian aerospace companies if they were to be tied in some way to existing programmes for attendances at the Paris Air Show in 1989 and Asian Aerospace in 1990.

Paris Air Show 1989

Arrangements are well advanced for the Australian participation at the 1989 Paris Air Show. This year State Government Departments concerned with industry development have indicated their willingness to support the ‘Australian Aerospace’ segment of the Australian stand. Following the success of the Bicentennial Air Show there is a willingness amongst the Australian industry which bodes well for a successful presentation of Australian aerospace in Paris this June.