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The Aerospace Industry: Value Chain, Market Potential and Global Trend
encountered has placed downward pressure on the purchase price of new hardware. Currently, discounts on the list price may be as high as 70%. OEMs therefore become reliant on aftermarket revenues (spare parts and maintenance) to ensure profitability. This is sometimes known as a ‘time and materials’ approach. Thus the OEM may cross subsidise the sale of original equipment with aftermarket sales, and in so doing may implicitly absorb risk from the airline, creating a situation where both the airline and the OEM are reliant on customer (seat) demand to be profitable.
The aerospace industry is truly one of the unique sectors of commerce and technology in the modern world. Virtually non-existent just 100 years before, the aerospace industry is now a key player in the global transportation sector, and more significantly a substantial contributor to the global economy.
Market Potential Airplanes are complex machines and comprise of thousands of sophisticated components from almost as many suppliers. Thus making aerospace production lines enormous, complicated, and populated by many specialized staff. Barely a few years ago, so much assembly was done on the main line that parts of a plane weren't even recognizable for many months.
Value Chain Due to the large scale activities typical to the aerospace industry, over capacity and low yields can lead to instability in the sector. The effects of any disturbances within the global economy cannot be absorbed and thus the impact is felt heavily by the aerospace industry. The most severe of these problems to face the aerospace industry is the high investment required in acquiring and maintaining airframe and engine fleets. For example, the typical 787 airframe has a list price in the region of USD300 million, with engines adding a further USD35 million. While such hardware purchases may have typical lifecycles of at least 25 years, the industries susceptibility to global incidents means that airlines investing in new aircraft are taking considerable risk in anticipating the future demand.
Unassembled airframes at an aircraft assembly line (Source : Holophane)
“Virtually non-existent just 100 years before, the aerospace industry is now a key player in the global transportation sector and more significantly a substantial contributor to the global economy”
This assembly method meant high cost of wages, plant operations, inventory storage, and so on that increasingly reduced profit margins. Enlisting suppliers to create and assemble sections of a plane, for example, rather than one component in a section, forces the complexity out of airframe production lines and back up the supply chain. For example, a supplier that once made the aluminum skins for wings might now branch out and also manufacture the struts for the wing’s frame. In some of the major aircraft programs, the OEM has subcontracted the creation of all electrical wiring for the wing, assemble the wing with the wiring and ship the
Furthermore, for the aero-engine OEM and value chain, the consequence of customer uncertainty and the high risks
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completed wing to the main production line where it no longer needed to be built, but merely attached to the fuselage. Stabilizer torque box
â&#x20AC;&#x153;The global aerospace industry seems to experience serious challenges to improve efficiency and competitiveness while reducing operational costâ&#x20AC;?
Fin torque box
Outboard aileron Rudder
Wing fixed leading edge
Floor beams
Trailing edge panels
Elevator
Outboard flaps
Strut force and aft fairings
Leading and trailing edge panels Wing-to-body fairing
Toughened graphite
Flap Flaperon
Graphite Hybrid
Inboard and outboard spoilers Nose radome Nose gear doors
Main landing gear doors
Engine cowlings
Wing landing gear doors
These large orders are strongly influencing the companies in the supply chain of aircraft manufacturing and assembly to revisit their approach in building aircraft. They see more economic sense in moving production activities to China and India and other suitable countries in the region with the hope of benefiting from the low cost of doing business and significant reduction in logistics cost.
Components manufactured off-site and assembled into the final airframe (Source : OEA.NASA)
At this point, there exists a vast and ready market potential for suppliers as well as small and medium contractors to play an active role in the aerospace industry. Not only can these smaller players supply the main company with parts, they may also supply the necessary services such as research and design, installation, quality assurance, transportation and logistics, cleaning services and etc. Maintenance, repair and overhaul (MRO) is also often done by another OEM or a third party who does nothing but service. Service technologies have gotten so advanced that it makes sense to outsource to specialist companies for activities such as monitoring the performance of aircraft engines to predict probable breakdowns. As a matter of fact, many leading airlines have adopted this practice.
Total Value of Airbus 20 year deliveries: $190 billion Source : Airbus
1200
Number of Deliveries
1003
Global Trend
1000 800 600
287
400
181
182
350-400
VLA
200
The global aerospace industry seems to experience serious challenges to improve efficiency and competitiveness while reducing operational cost. This is particularly a bigger concern for aerospace players who have their operating bases in the US and Europe, where cost of doing business is escalating steeply. Thus, the industry players from these regions are looking to business opportunities in the greater Asian region where the cost of operation is low while productivity and quality levels are equivalent or better than what they are presently experiencing.
0 100-200
250-300
Type of Aircraft
From the above, it can be seen that the market potential for companies to enter the aerospace industry is extremely large. As such, it would be of great benefit for companies to start taking the necessary steps to integrate themselves with the aerospace industry. Additionally, these companies should also be willing to look for partner companies within the Asian region for optimizing mutual benefits.
This market forced migration of the aerospace industry players from the US and Europe is further compounded by the magnetism created by countries like China and India which are growing into economic superpowers. It is a known fact that both these countries have placed orders for over 2000 aircraft that will have to be progressively delivered in the next 5 to 10 years.
In conclusion, there is a vast and relatively untouched aerospace sector market for companies to attach themselves to. With the right mindset and drive, and given enough time, there is no doubt that Asia will become a major aerospace power in the world.
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Malaysian Aerospace Industry: An Overview
global aerospace supply chain. Thus, the government recognizes that it is necessary to aim towards higher value added activities which require investment in both R&D as well as marketing and supply chain management. This can only be achieved through understanding the current industry structure as well as considering methodologies to enhance innovation both in technology and marketing and by becoming more efficient and through a more measured approach in respect of returns on investment.
Aerospace is a mature industry which is highly regulated and financially geared. Pricing, revenues, return on investment, management of costs and profit margins are increasing challenges in a globally competitive market. This is heightened by the airline business being cyclic in nature due to global economic issues such as escalation in fuel price, safety, security and health considerations as well as yield erosion through competition and overcapacity.
The Malaysian aerospace industry has grown from RM10.8billion in 2001 to around RM21.5 billion in 2006. Commercial aviation is the major contributor to the industry’s revenue at around RM13.9 billion, whilst the MRO sector has almost trebled since 2001 to be worth RM3.9 billion as seen by the figure below. Malaysia aims to capture 5% of the global MRO market share by 2015 which requires 12% CAGR which is currently on track. The aerospace manufacturing sector has also seen significant growth as reflected by the increase in the turnover from RM372million in 2005 to RM426million in 2006.
The aerospace manufacturing business is subject to both high entry and mobility barriers as a result of capital intensity, increasing product complexity and technology employed. A redefinition in the supply chain has thus resulted and encouraged the development of systems integrators, alliances and joint ventures and risk and revenue sharing technology partnerships. Primes are offloading more risk and responsibility to suppliers who in turn are developing niche competencies in both product and process.
“The government recognizes that it is necessary to aim towards higher value added activities which require investment in both R&D as well as marketing and supply chain management”
“Pricing, revenues, return on investment, management of costs and profit margins are increasing challenges in a globally competitive market”
Malaysia’s Revenue from Aerospace Manufacturing
Multinationals have therefore reduced their investment risk and spread costs through increasingly adopting a transnational sourcing approach through long term contractual relationships. However, they also desire to reduce their supplier base. Such supply chain rationalization is demanding suppliers with increased capability and integration skills. The primes have adopted outsourcing as a tactical approach to reduce cost of production. The approach also provides market access, resource in respect of skills and capability matching as well as access to global funding.
900
Revenue (RM million)
800 700 600 500 400 300 200 100 0
Projected
2001
Malaysia desires to become an important member in the
2002
2003
2004
2005
2006
(Source : Malaysian Aerospace Industry Report 2007/2008)
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2008
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With the recent growth in the aerospace and aviation industries and the continued growth within the Asia Pacific region coupled with the desire for multinationals to become more competitive through lower cost sources, this has provided a unique market opportunity leading to an effective opportunity for future growth. What then are the measures the Malaysian aerospace industry needs to take advantage of in meeting such changes? It is becoming more difficult for new entrants to be part of the global aerospace supply chain as technology advances, with the demands for technological skills, high capital expenditure, cost efficiency, delivery and quality. Furthermore, the primes are increasingly focused on the aftermarket (with 50% growth forecasted in MRO over the next 10 years) in order to protect margins over the product life cycle and preclude the entry of other manufacturers supplying parts for their equipment. This is demanding more contractualisation whilst transferring technology encourages opportunities for Malaysian industry.
YAB Prime Minister inspecting RazakSAT
â&#x20AC;&#x153;Global sourcing has led to increasing fragmentation in the supply chain
Global sourcing has led to increasing fragmentation in the supply chain demanding e-business tools as well enhancements in supply chain management. To attain competitive advantage, market leadership demands continuous innovation in product and process as well as in marketing, information management and developing value networks. Further marketing innovation both in strategy and implementation whilst not expected by customers has been shown to assist in raising awareness of capability, securing work and in meeting customer requirements.
demanding e-business tools as well enhancements in supply chain managementâ&#x20AC;? processes and to engage in R&D with suppliers in future. Market leadership requires continuous innovation, development of niche technologies and capability to maintain competitive advantage through technology and a sound technology base through a cluster approach.
It has been established that prior experience and cultural compatibility were not necessarily inhibitors in securing work provided that workmanship quality, consistency of delivery and organisational and staff motivation were assured. In this respect Malaysian companies need to recognise the importance of workmanship quality even if this is to the detriment of achieving the lowest price. Long term relationships have been shown to lead to improved efficiencies and encourage more innovation and thus it is important that Malaysian aerospace companies not only secure but retain such work.
It has been shown that the top six obstacles to innovation are that of a short term focus, lack of time, lack of resource or shortage of staff having the necessary skills, leadership expectation of payoff, management incentives not structured to reward innovation, lack of systematic innovation process and the belief that innovation is risky and is seen as an expense as opposed to an investment. If it is possible to overcome such obstacles then Malaysia may find itself developing an innovative strategy to drive market leadership in its goal to become an important member of the global aerospace supply chain. Success in aerospace comes directly and fundamentally from the technology and the national technology base that creates it.
Aerospace multinationals neither expect nor demand product innovation. Process innovation when applied to productive efficiency was however required in order to remain competitive particularly in production and logistics
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Continuous R&D over a long period builds up intellectual property embedded in specific products. Acquiring such a body of knowledge, expertise and experience constitutes one of the formidable barriers to entry to countries and for companies seeking a foothold in the global aerospace market. With Malaysia’s limited critical mass these issues will prove a challenge. Working with regional sources may offer a solution as indeed would greater local collaboration.
“Efforts have been made within Malaysia’s academia to expand the level of R&D with tertiary institutions such as USM, UPM, UTM and UKM all engaged in various aspects of government funded aerospace research” The attributes required to be successful in contract manufacturing is attaining competitive advantage through workmanship quality and reliability, firm pricing, long term agreements and ensuring customer satisfaction. The choice of supplier by the multinational is based on these factors as well as the company’s prior transactions, prior relationships, inclination towards innovation and technical capabilities. With the need for low levels of uncertainty in supplier selection, such decisions tend to be based on technical capability with much less focus on governance.
Engine under maintenance (Source : Aerospace Technology System Corp. Sdn Bhd)
Efforts have been made within Malaysia’s academia to expand the level of R&D with tertiary institutions such as USM, UPM, UTM and UKM all engaged in various aspects of government funded aerospace research. Further details of this research can be found in the recently launched Aerospace Industry Report 2007 published by MIGHT. However, more engagement and activity within the industry sector is required if the aerospace industry in Malaysia is to ensure continued advancement. This is demonstrated by the figure below showing the level of R&D expenditure in European companies over the past 10 years.
M a r k e t leaders within the aerospace community are no longer prepared to invest in low technology or low margin products aimed at new Research and Development (Source : Science & Technology Research Institute for Defence) customers when better returns are available from high technology product refinements aimed at existing customers. Large companies are thus retreating up market permitting newer companies to target niche markets.
Trend and Breakdown of R&D Expenditure - European Companies 2003 Total: 10.8billion Euro=14.5% of Turnover *
% of turn over
20% 18% 16% 14% 12% 10% 8% 6% 4% 2% 0%
16.0% 14.0%
12.5%
14.5% 14.5% 12.5%
13.9% 14.5%
1996 1997 1998 1999 2000 2001 2002 2003
R&D Expenditure Trend
18.6% 15.2%
13.6%
The demand for trained personnel and skills define competitive advantage and recently has led to shortages. To counter this Malaysia Airlines expanded its training by establishing the Malaysia Airlines Engineering Training Centre at Malaysia International Aerospace Centre (MIAC), Subang. This initiative led to the collaboration between Malaysia Airlines’ Engineering and Maintenance Division
System Engines Equipment & Frames
2003 R&D Expenditure by Sector **
(Source : ASD)
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and FELDA to ensure continuous supply of skilled workforce to the industry. In addition in 2006, Malaysia Airlines and Politeknik Shah Alam teamed up to conduct a Diploma course in Aircraft Maintenance. In meeting the demand for aero composites manufacturing skills, ACM and Kedah Industrial Skills and Management Development Centre jointly implemented the Workforce Technical Transformation Program.
carbon, glass and aramid fiber material. The Beech Starship was the first all-composite aircraft to receive FAA certification where approximately 3000 pounds of composites was used. The Boeing 767 also employs around 3000 pounds of composites for doors and control surfaces; the rudder at 36 feet is the largest composite component in service.
â&#x20AC;&#x153;The advantages of composites are their high strength-to-weight ratio, excellent fatigue and corrosion resistance, good impact resistance, design flexibility and lower part countâ&#x20AC;?
In summary the aerospace supply chain is becoming more global leading to more competition and overcapacity. The Asia Pacific region is seeing increased activity through significant growth in air transportation, resultant MRO activity as well as manufacturing as the global industry seeks lower cost sources. Malaysia needs to take advantage of this opportunity through a sound FDI policy and through its endowment factor based advantages. The market today is heavily focused on cost and value but the need for skilled and talented supplierâ&#x20AC;&#x2122;s remains.
Composites in the Aerospace Industry
Specific Strength of Aerospace Materials (Strength + Density)
10
What are carbon composites?
8
A carbon fiber is a long, thin (0.005-0.010 mm diameter) strand of material composed mostly of carbon atoms, bonded together in microscopic crystals more or less aligned parallel to the axis of the fiber making the fiber strong for its size. Several thousand carbon fibers are twisted together to form a yarn, which is then woven into a fabric. The fabric is combined with epoxy and wound or moulded into shape into various forms.
6 4 2
The advantages of composites are their high strength-to-weight ratio, excellent fatigue and corrosion resistance, good impact resistance, design flexibility and lower part count. Weight savings are particularly important in a market environment characterised by increasing fuel prices and the prospect of ever-more stringent aircraft emissions standards.
0 Carbon Fiber Composite
Glass Fiber Composite
Aluminium
Steel
Composites are widely used in aircraft interiors to create luggage compartments, sidewalls, floors, ceilings, galleys, cargo liners and bulkheads. Fiberglass with epoxy or phenolic resin utilising a honeycomb sandwich construction enables aesthetic structures whilst meeting flammability and impact resistance requirements.
Applications One of the first aircraft to utilise composites was the Lear Fan 2100 which uses approximately 1880 pounds of
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Aerospace composites market will grow Historically, the use of composites over the last 30 years has evolved from less than 5% in the Boeing 737 and 747 to over 17% in the Airbus A320 launched in 1990. Today the Airbus A380 uses around 23% composites per aircraft and the Boeing 787 to enter service later this year will use about 50% composites by structural weight. The market for aerospace composites, encompassing both production and maintenance, repair and overhaul (MRO) services, is according to AeroStrategyâ&#x20AC;&#x2122;s 2006 estimate worth US$7.3 billion. Production of finished composite components and structures for new aircraft accounts for three-quarters of that figure, or US$5.5 billion. The air transport production sector accounts for US$3.3 billion of the total while military aircraft production is valued at US$1.6 billion.
Lay-up Process (Source : Asian Composites Manufacturing Sdn Bhd)
In 1979, a pilot project was initiated to manufacture carbon fiber fin box assemblies for the A300/A310 aircraft using a highly mechanised production process to determine if the high material cost could be offset by increased manufacturing efficiencies. Although material costs were 35% greater than a comparable aluminum structure, total manufacturing costs were lowered by 65 to 85%.
Business aircraft and civil helicopters make up US$600 million, a figure that reflects lower market penetration and smaller aero structures, while the demand for the MRO service of composite components, such as repair of thrust reversers, radomes, nacelles, control surfaces, structural components and cabin interiors is worth US$1.8 billion.
In the military sector, advanced composites enable the military Advanced Tactical Fighter (ATF) to meet improved performance requirements such as reduced drag, low radar observability and increased resistance to temperatures. The ATF is approximately 50% composites by weight. The Advanced Technology Bomber (B-2) derives much of its stealth qualities from the material properties of composites and their ability to be moulded into complex shapes. Each B-2 contains an estimated 40,000 to 50,000 pounds of advanced composite materials. The Osprey Tilt-Rotor (V-22) a weight sensitive craft developed by Boeing and Bell Helicopter consists up to 40% of composites.
As for the future, Gardner in 2007 predicted that the increasing percentage of composites in new transport aircraft and continued growth in the demand for MRO services will combine to nearly double the aerospace composites market. They stated that the market will reach US$14 billion in constant 2006 dollars over the next decade at a compound annual growth rate of nearly 7 percent with the air transport OEMs expanding at an annual rate of 9.5 percent. This is supported by both Hexcel in their outlook for 2008 and by Lucintel who estimate that the aerospace market will see an estimated US$57 billion worth of composite materials during 2007 â&#x20AC;&#x201C; 2026.
Composite materials have been used for helicopter rotors for some time and have gained virtually 100% acceptance as the material of choice due to improved aerodynamic geometry, improved aerodynamic tuning, and good damage tolerance and potential low cost and strength. Fatigue characteristics of the composite blade are considerably better than their aluminium counterparts with the aluminium failing near 40,000 cycles and the composite blade exceeding 500,000 cycles.
It is considered such growth will reshape the aerospace supply chain. Aircraft OEMs appear to be pursuing an automotive industry strategy, focusing on final assembly and systems integration whilst cutting back on internal production. This passes commercial and technological risk to supply chain partners. A recent example is Boeingâ&#x20AC;&#x2122;s divestment of its Wichita and Tulsa fuselage production facilities to Spirit Aerosystems.
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Application of Composite Materials by Sector - Global Perspective 275 250 225 200
Million Lbs
175 150 125 100 75 50 25 0 2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Thermoplastic/Electronics
Infrastructure/Construction
Alternative Energy/Wind Energy
Transport/Marine
Automotive
Sporting Goods
Industrial
Oil/Off-Shore Drilling
Aircraft Aerospace
Year
Cutting the cost of aerospace composites
â&#x20AC;&#x153;More investment is being made in new equipment for traditional methods and there is a growing trend for simple parts to be manufactured in lowwage economies of Asiaâ&#x20AC;?
The market price of carbon fiber reinforced plastic increased by 150% during 2005 as demand by Boeing and Airbus caused supply constraints. This demand continues and AOC stated that they will make a USD $0.10 per kg price increase for all products effective January 1, 2008 impacted by record high prices for West Texas Intermediate. Natural Gas is following crude oil prices and these critical feed stocks are used to make the raw materials. To counter this the US composite industry spends around US$1 billion a year on composites research mainly aimed at lowering cost in aerospace manufacturing processes. Recently Raytheon built a complete fuselage which did not require hand finishing after curing. V Systems has developed out-of-autoclave processes. More investment is being made in new equipment for traditional methods and there is a growing trend for simple parts to be manufactured in low-wage economies of Asia. Malaysia has benefited from this demand for lower cost with the growth of CTRM, ACM and the recent investment of Spirit Aerosystems in MIAC.
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about 7% per year. Malaysia’s goal is to develop itself as a regional base and as a one-stop hub for aircraft MRO.
Commercial & Aerospace Grade Composite Global Market Volumes for 2008 and 2010 2006 - $880 million Market
2010 - $2 billion Market
Aerospace Grade 41%
Malaysia has identified MRO as one of the niche areas to be developed. The country has the potential to be a global player in MRO as it possesses a wide range of capability for both military and civil aviation, ranging from modification, engines and components overhaul to line and heavy maintenance. The typical MRO sub-sector can be divided into five segments which include engine overhaul, airframe heavy maintenance, component maintenance, line maintenance and airframe modifications.
Aerospace Grade 29%
25% CAGR Commercial Grade 59%
(Source : Zoltek)
Commercial Grade 71%
This industry could be further enhanced by the expansion of the supply chain both vertically and horizontally. With Malaysia’s resources having the core feed stock for the composite materials it would be easier for the aforementioned suppliers to establish such manufacturing in country. This material could then be used by both Malaysian and regional companies. In turn, this would encourage yet further growth through reduced costs of those employed in the aerospace manufacturing sector. This would place further emphasis on R&D activity. This competency would then encourage more aftermarket organisations to establish capability in Malaysia leading to greater demand for skilled technicians and engineers.
Revenue for Malaysia’s MRO Activities Revenue (RM million)
6 5 4 3 2 1 0
Projected
2001
In conclusion, the development and knowledge of composites used in the aerospace industry is an on-going process in an industry that is growing significantly. At the same time, the considerable benefits offered by composites have yet to be fully exploited and as knowledge and understanding grow, composite materials will play a more increasingly important role.
2002
2003
2004
2005
2006
2007
2008
(Source : Malaysian Aerospace Industry Report 2007/2008)
Malaysia aims to capture 5% of the global MRO market share by 2015, which will require the MRO sub-sector to grow at about 12% annually. It is currently on track to achieve this as the average annual growth for the last five years has been above 12%. The industry players are also optimistic that the near to medium term MRO revenue growth would be between 13-15%.
OPPORTUNITIES IN MAINTENANCE, REPAIR AND OVERHAUL (MRO)
“The country has the potential to be a global player in MRO as it possesses a wide range of capability for both military and civil aviation, ranging from modification, engines and components overhaul to line and heavy maintenance”
The market for maintenance, repair and overhaul (MRO) is large, global and competitive with an estimated annual value of US$38billion. It is currently passing through a particularly difficult period with occurrences of retrenchment, restructuring and consolidation. However, the MRO sub-sector has always been dynamic and greatly influenced by major world events. The MRO is a long-term growth sub-sector of the industry and will likely expand at
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Malaysia Aerospace Turnover by Sector, 2006 Support / Spare Trading Aerospace Training
Design / Manufacturing GA / Sports Aviation
Aircraft Trading Airport / Satellite Ops
MRO
Commercial Aviation
Engineering and Maintenance Activities (Source : Malaysia Airlines)
Malaysia, with a well planned and managed MRO sub-sector, would have many competitive advantages and could offer an attractive alternative to the global service providers. Currently, the Malaysian MRO subsector is capable of maintaining and overhauling popular airframes such as the 747’s, 777’s, A320’s and A330’s as well as their engines, i.e. the CFM56, PW4000 and the Trent series. Although MRO is the second largest contributor to the aerospace revenue, there is still significant room for MRO activities to grow in terms of depth and scope of capabilities.
Local partners Malaysia already has the firm foundation in place on which to build a larger MRO sub-sector. Many local companies and thus potential local partners are currently participating in all the key areas of MRO, although some only in a modest way. Examples include Malaysia Airlines Bhd (Engineering) in airframes, the GE/MAS joint venture General Electric Engine Services Malaysia Sdn Bhd (GEESM) in engines, MHS Aviation Bhd in helicopters, Hamilton Sundstrand, Parker Hannifin (M) Sdn Bhd and Zetro Services Sdn Bhd in components, and KLAS Engineering Services Sdn Bhd in line maintenance as well as the newly established Sepang Aircraft Engineering Sdn Bhd.
The rapid development and expansion of the MRO can be attributed to the recommendations prescribed in the Malaysian Aerospace Blueprint. The launching of MIAC is also seen as a significant catalyst that can further promote and attract MRO businesses to Malaysia.
“Malaysia already has the firm foundation in place on which to build a larger MRO sub-sector. Many local companies and thus potential local partners are currently participating in all the key areas of MRO, although some only in a modest way”
Leveraging on Offset Programs to Expand MRO Business It is the policy of the Government to negotiate offset obligations on major foreign purchases which is intended to enhance the local industry by strengthening its expertise, capacity and marketing potential. In benefiting the local MRO business, offsets may involve the obligor to provide OEM approvals & certifications such as Authorised Maintenance Centre (AMC) certification, technical support in modification & upgrade activities, industrial collaboration & joint venture with OEMs, technology transfer and etc. These activities are targeted to intensify the involvement of Malaysian MRO organisations in the global MRO market segments.
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Additionally, Airod Sdn Bhd covers almost the complete spectrum of military MRO and has expertise in C-130 conversions, while a number of learning institutions typified by the Malaysian Institute for Aerospace Training Personnel Undergoing Aircraft Maintenance Training (Source : Malaysian Institute of Aviation Technology) (MIAT) can provide skilled human resources. Malaysia already has most of the skills required to maintain the latest generation of aircraft and engines and these will form the basis on which it has to build.
“Malaysia also has locational advantages related to its geography, ‘business friendly’ government policies, skill levels, use of English, infrastructure including the new KLIA airport, and political stability”
Malaysia also has locational advantages related to its geography, ‘business friendly’ government policies, skill levels, use of English, infrastructure including the new KLIA airport, and political stability. Other factors that provide an advantage over many other locations are a legal framework and an airworthiness framework that are both internationally recognized. In conclusion, the potential for MRO growth in Malaysia is high. With the right amount of support and interest from local entrepreneurs, as well as the government, it is no doubt that this sector will become a major contributor to the Malaysian economy.
We hope you have enjoyed this Techscope issue. In order to improve further, please forward your suggestion to techscope@might.org.my Thank You. Malaysian Industry-Government Group for High Technology Level 6, Block 2, Menara PJH, P.O. Box 11 & 12, Precinct 2, 62100 Putrajaya, MALAYSIA Tel : 603-8315 7888 Fax : 603-8888 8232
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