Aerospace Industry News

He suggested that whilst a number of longer term agreements (involving research and development and investment programmes) are being pursued by the Department of Industry Technology and Commerce with the major overseas aircraft systems suppliers, there is a growing understanding that a considerable workload is required to ensure Australian aerospace companies have the proven track records to benefit from these programmes. He stressed that, in the aerospace field, all work tends to involve high technology processes and is of considerable benefit to Australia.

He noted that Defence offsets continue to emphasise the acquisition of capabilities to maintain the strategic support capabilities of Australian industry and that this has a beneficial effect on the industry’s ability to be internationally competitive in a range of marketing situations in both the military and the civil fields.

Marketing

The Chairman reported to members that there was increased recognition within Government of the competitive nature of the international aerospace industry-especially as the impact of reduced Defence budgets in the major aerospace nations was resulting in Defence contractors in those countries looking to the commercial field to replace their lost military projects.

He drew attention to the way many overseas Governments (either overtly or covertly) support their aerospace industries export marketing activities-especially in relation to soft loans and other financial incentives.

Despite lacking comparable levels of direct financial support from the Australian Government, the Australian aerospace industry is ‘bullish’ in relation to export marketing. He pointed to the significant increase in exports (in real terms-18%) achieved by the industry in the last year. The recent initiative of using a Specialist Trade Commissioner Aerospace may not have worked as well in practice as many had anticipated, but this did not mean that the industry had become disenchanted with the export market. He announced that the Association had agreed to provide Austrade with appropriate alternative export marketing strategies and plans by mid November.

Defence Export Support

The Chairman also announced plans for collaboration with the Department of Defence, Austrade and DITAC to market Australia’s capabilities for the maintenance of military aircraft and associated equipments. These are seen to be capable of significantly boosting Australian aerospace exports into the South East Asia region.

Other matters being addressed are: DOD/US

•  joint AAA/Australian DOD co-operative programmes to attract US Western Pacific maintenance workload to Australia. Initial programmes are developing satisfactorily; and
•  extending the present technology exchange and supply and support agreements the Australian DOD has signed with various European countries to include commercial agreements between companies.

Participation in Trade Exhibitions

The Chairman reiterated the AAAI view that only the Paris Air Show (as the premier ‘world’ air show) and Asian Aerospace (as the premier regional air show) were of sufficient importance to the Australian industry to warrant the investment of significant funds to support Australian industry participation. He noted that a number of other events are being suggested as being worthy of support. He pointed out that participation in more than two or three shows (per 2 year cycle) was beyond the capacity and need of most companies. He argued that, as resources (both financial and manpower) from both the Association and the Australian Government to support Australian participation at international air shows were as limited as they are, it was a better policy to concentrate on the Paris and Singapore Shows exclusively. This meant that any company, which (for its own commercial reasons) wanted to attend a non-sponsored show, would have to do so without external support.

International Collaboration

Noting the worldwide trend towards participation in international risk sharing programmes as a method of ensuring international market share, the Chairman urged members to direct their attention towards forming teams to participate in such programmes. He surveyed current activities in relation to the US, European and Japanese Aerospace industries and reported on the numerous meetings held with aerospace associations in those countries. He pointed out that because of the high value of the yen, the Japanese industry was becoming uncompetitive in relation to performing offsets tasks. They were, therefore, looking to place such work offshore-either as sub-contract work or as a joint programme activity. This could provide opportunities for some AAAI members.

State Government Involvement

The Chairman welcomed the stepping up in industry development activities by the various State Governments. The AAAI Executive is working closely with State Governments to achieve an integrated approach to these activities which will benefit the whole of the industry.

Resource Limitations

Finally, the Chairman pointed out that the workload the AAA is undertaking is considerably in excess of that which was envisaged when the Association was formed. He suggested that in the coming year, the Executive would have to look closely at how to overcome the mismatch between tasks and available resources (both financial and manpower).