international opportunities in the aerospace and defense...

International Opportunities in the Aerospace and Defense Sector

Presented by

Mathew D. WoodleeSenior International Trade SpecialistU.S. Commercial Service – Minnesotawww.export.gov/minnesota

Melissa GrossoSenior International Trade SpecialistGlobal Aerospace & Defense Team LeaderU.S. Commercial Service – Connecticut www.export.gov/connecticut

Why Export?

Increased sales and profits

Overcoming low growth in the domestic marketplace

Minimizing the effect of seasonal sales fluctuations

Exploiting technology and expertise in foreign markets

Achieving economies of scale

Grow your business

Keep up with the competition

• 96% of all customers reside outside the USA

Who’s Exporting…?

Small- and medium-sized enterprises!

• 97% of U.S. exporters are SME’s

• Represents 30% of total export value

• Most export to only 1 foreign market

• Most have fewer than 20 employees

U.S. Free Trade Agreements (FTAs)FTAs reduce barriers to U.S. exports, and create a more stable and transparenttrading and investment environment, making it easier and cheaper for companies toexport their products and services.

U.S. FTA Partner Countries Australia Bahrain Chile CAFTA-DR (Costa Rica, Dominican Republic, El Salvador, Guatemala,

Honduras, & Nicaragua) Colombia Israel Jordan Morocco NAFTA: Canada & Mexico Oman Panama Peru Singapore South Korea

Basic Requirements for Exporting

• An exportable product or service

• A competitive advantage

• The finance to take it to the marketplace

• A commitment in making the export project work

Your International Team Must be:

• Flexible• Committed to travel• Work Independently• Good “Ambassadors”• Technologically Proficient• Culturally Sensitive

National Export Initiative

More exports = more jobs

- Through the National Export Initiative (NEI), President Obama has announced a goal of doubling exports within five years to support two million job in America

Government support

- To help achieve this goal, the Export Initiative will provide more funds, focus, and cabinet-level coordination to grow U.S. exports.

- This is the first time the United States will have a government-wide export-promotion strategy with focused attention from the president and his Cabinet

Federal Agencies and the Trade Promotion Coordinating Committee

Trade Promotion Coordinating Committee is taskforce of 20 agencies focused on coordinating government-wide export promotion through 7 core agencies:

– U.S. Department of Commerce– U.S. Export – Import Bank– Overseas Private Investment Corporation– U.S. Trade & Development Agency– Small Business Administration– Department of State– Department of Agriculture

U.S. Commercial Service

The U.S. Commercial Service provides U.S. companies unparalleled access to business opportunities around the world.

As a U.S. Government agency, we have relationships with foreign government and business leaders in every key global market.

Our trade professionals provide expertise across most major industry sectors, in all major and emerging markets

We offer fee‐based services to U.S. companies to help them expand international sales of U.S. made products and services

U.S. Commercial Service –Located in 120 cities in over 75 countries

AlgeriaAlgiersArgentinaBuenos AiresAustraliaMelbourneSydneyAustriaViennaBelgiumBrusselsBrazil Belo HorizonteBrasiliaRecifeRio de JaneiroSao PauloBulgariaSofiaCanadaCalgaryMontrealOttawaTorontoVancouverChileSantiago

ChinaBeijingChengduGuangzhouShanghaiShenyangColombiaBogotaCosta RicaSan JoseCroatiaZagrebCzech RepublicPragueDenmarkCopenhagenDominican RepublicSanto DomingoEcuadorQuitoEgyptAlexandriaCairoEl SalvadorSan SalvadorFinlandHelsinkiFranceParis

GermanyBerlinDusseldorfFrankfurtMunichGhanaAccraGreeceAthensGuatemalaGuatemala CityHondurasTegucigalpaHong KongHong KongHungaryBudapestIndiaAhmedabadBangaloreCalcuttaChennaiHyderabadMumbaiNew DelhiIndonesiaJakartaIraqBaghdad

IrelandDublinIsraelJerusalemTel AvivItalyFlorenceMilanRomeJapanNagoyaOsaka‐KobeSapporoTokyoJordanAmmanKazakhstanAlmatyKenyaNairobiKorea (South)SeoulKuwaitKuwait CityLebanonBeirutLibyaTripoli

MalaysiaKuala LumpurMexicoGuadalajaraMexico CityMonterreyTijuanaMoroccoCasablancaNetherlandsThe HagueNew ZealandWellingtonNigeriaLagosNorwayOsloPakistanIslamabadKarachiLahorePanamaPanama CityPeruLimaPhilippinesManilaPolandWarsaw

PortugalLisbonQatarDohaRomaniaBucharestRussiaMoscowSt. PetersburgVladivostokSaudi ArabiaDhahranJeddahRiyadhSenegalDakarSerbia & MontenegroBelgradeSingaporeSingaporeSlovak RepublicBratislavaSouth AfricaCape TownJohannesburgSpainMadrid

SwedenStockholmSwitzerlandBernTaiwanKaohsiungTaipeiThailandBangkokTurkeyAnkaraIstanbulIzmirUkraineKievUnited Arab EmiratesAbu DhabiDubaiUnited KingdomLondonUruguayMontevideoVenezuelaCaracasVietnam HanoiHo Chi Minh City

Access Export

ReadinessIdentify Key

Markets

Determine Sales

Potential Implement Export Plan

How We Can Help

Overcome Challenges

Trade Counseling

Market Intelligence

Business Matchmaking

Due Diligence

Trade Events

In‐Country Promotion of Your Products or Services

Commercial Diplomacy

Whether you are looking to make your first export sale or expand to additional international markets, we have the expertise you need to identify and penetrate foreign markets.

Export Counseling

Export Documentation & Regulations Identifying Schedule B/HTS Numbers Foreign Tariffs/Taxes Identifying Foreign Markets Finding Agents, Distributors, Reps, etc. Trade Shows and Events Finding International Buyers International Marketing Strategies Export Finance Resources

Export Finance Resources Vetting/Due Diligence on Foreign

Parties Inco‐terms and How to Get Paid International Shipping & Logistics Certificates of Origin Leveraging Trade Agreements &

Free Trade Zones Foreign Import Requirements Export Controls

Aerospace & Defense Sales Issues International Traffic in Arms Regulation (ITAR):

– Directorate of Defense Trade Controls, Department of State

pmddtc.state.gov

Export Administration Regulations (EAR)– Department of Commerce, Bureau of Industry & Security

www.bis.doc.gov

Foreign Military Sales (FMS)– Department of Defense, Defense Security Cooperation Agency

www.dcsa.osd.mil

Country Commercial Guides

- Leverage reports, prepared annually by U.S. Embassy staff, containing information on the business, economic and political environments in foreign countries

Foreign Market Conditions

- Industry‐specific market research reports and analysis

- Country‐specific tariff, tax and regulatory information

International Demand Forecasting

– Data mining and predictive analytics

– Target foreign markets with highest demand for your products

Market Intelligence

International Partner Search (IPS)

You provide your marketing materials and background on your company

We utilize our network of international contacts to interview potential partners and provide you with a list of pre-qualified candidates.

Save valuable time and money by working only with pre-qualified international candidates that are interested in selling your products and services.

Obtain high-quality market information on the marketability and sales potential for your products and services.

Gold Key Matching Service (GKS)

Pre-screened appointment schedule arranged for you before you travel overseas

Customized market and industry briefings with our local trade specialists at U.S. Embassies and Consulates

Timely and relevant market research

Post-meeting debriefing with our trade specialists and assistance in developing appropriate follow-up strategies

Help with travel, accommodations, interpreter service, and clerical support, etc.

International Company Profile (ICP)Determine whether an overseas company or individual is a suitable partner:

- Management details

- Business activities

- Product/service lines

- Financial condition

- Credit-worthiness

- Trading experience

- Market coverage

- Business connections in the target country.

Single Company Promotion (SCP) This service provides support and official sponsorship in a specific

market under the auspices of the American Embassy or Consulate. – Product launches– Technical seminars

– Networking receptions

Held in a well recognized location, such as a hotel or in some cases, the U.S. Ambassador's residence.

A typical event might include a 3-hour program with an introduction by a U.S. Government official followed by detailed company presentation and question/answer session followed by a networking session.

Trade Shows/Trade Missions

International Trade Shows– U.S. pavilions put you in the best international trade shows with

access to thousands of buyers. – one-on-one meetings with potential buyers.

International Buyer Program (IBP)– U.S. Department of Commerce selects leading domestic trade shows

to promote through its global network of offices and contacts.– U.S. Commercial Service staff in our Embassies and Consulates

abroad recruit and bring delegations of qualified buyers, prospective representatives and distributors to domestic trade shows.

– U.S. Commercial Service staff then facilitates meetings between buyers and exhibitors.

International Trade Missions– Opportunity to meet with distributors, government and industry

officials, prospective customers, and U.S. Embassy officials.

Commercial Diplomacy

Overcome trade obstacles to successfully enter international markets.

Access U.S. government trade advocacy for your foreign government procurement bids.

- Visits to key foreign officials by high-ranking U.S. officials

- Direct support from U.S. officials stationed overseas

- Letters to foreign decision-makers

Level the international playing field for your company

Global Aerospace and Defense Team

Over 200 members worldwide Supporting over 21,000 clients in over 3,800 aerospace and

defense related organizations Nationally partnering with 5 official CS partners and

collaborating with 4 others Self funded activities

Sample of Team Activities

Client Development, buyer, seller match making External (private sector) industry training for team members Topical Webinars Trade Missions Global Matchmaking Receptions Show-Time: trade counseling by country at major trade shows Large Networking Events Customized value-added services for US Exporters Market Research Partnership Development Export Controls Seminars

www.export.gov/industry/aerospace

Aerospace And Defense Markets To Be Covered

Canada China France Germany India Israel Singapore South Korea Turkey

Canada

General Overview•In 2011, it generated approximately $22 billion•14 largest aerospace companies generate 51% of jobs and account for 65% of payroll•Key clusters are Montreal, Quebec (approx. 55% of the Canadian market) and Ontario (approx. 18%)

General Overview•In 2011, it generated approximately $22 billion•14 largest aerospace companies generate 51% of jobs and account for 65% of payroll•Key clusters are Montreal, Quebec (approx. 55% of the Canadian market) and Ontario (approx. 18%)

Civil Aircraft Sector•83% of output is from civil aircraft manufacturing; military is 17%•In the U.S., military is 56% of output, civil is 44% output

Civil Aircraft Sector•83% of output is from civil aircraft manufacturing; military is 17%•In the U.S., military is 56% of output, civil is 44% output

International Trade•Over 82% of production is exported •Over 50% of production is sold to the U.S.

International Trade•Over 82% of production is exported •Over 50% of production is sold to the U.S.

Key Facts about Canada’s Aerospace Industry

The Canadian aerospace market is uniquely well positioned for capturing a significant portion of the next generation aircraft’s production

Canada is Home to Leading Aerospace Players

Canadian American European

Source: http://www.aiac.ca/canadas‐aerospace‐industry/industry‐statistics/

Composition of the Canadian Aerospace Market

Canada’s Aerospace Sub‐Sectors

Aircraft and Aircraft Parts

BombardierBombardier

Bell Helicopter Textron

Bell Helicopter Textron

EurocopterEurocopter

MRO

Innotech ExecaireInnotech Execaire

StandardAeroStandardAero

Engine and Engine Parts

Rolls Royce Canada

Rolls Royce Canada

Pratt & Whitney Canada

Pratt & Whitney Canada

TurbomecaTurbomeca

Simulations and Training

CAECAE

MechtronixMechtronix

Systems CanadaSystems Canada

Avionics and Electrical Systems

EsterlineCMC

Electronics

EsterlineCMC

Electronics

Air DataAir Data

Lockheed Martin Canada

Lockheed Martin Canada

Space

MDA Corporation

MDA Corporation

ABB BomenABB Bomen

Trends on Canadian Aerospace Market

Emerging Markets•Demand for civil aircraft that cannot be met by domestic manufacturers ‐ Chinese nationals alone are reportedly looking to purchase 200 business aircrafts

•Higher demand for single aisle aircraft with less than 200 seat capacity ‐ Canadian aerospace manufacturers’ core competency

Green Technology•Green Aviation Research and Development Network (GARDN)

• Thriving composites industry

•Major Canadian aerospace manufacturers expect their aircraft nitrous oxide emissions and noise levels to be reduced by 80% and 50% respectively

MRO Centers•Canada has several established MRO hubs in provinces like Manitoba and Quebec

•Most airlines state that they have underinvested in MRO activity – positioning Canada as a leading global MRO hub

•Canada has a vast engine MRO capability, ranging from small turbo shafts and turbo tops to large turbo fan engines

Canada and US Defense Procurement

Defense Production & Development Sharing Agreement

The Canadian ITARExemption

Canada First Defense Strategy

U.S. companies can bid on Canadian government projects (www.merx.com)

http://www.law.cornell.edu/cfr/text/22/126.5

A Few ResourcesFrom the Canadian Government

National: Industry Canada – Aerospace and Defense (http://www.ig.gc.ca/eic/site/ad‐ad.nsf/eng/home)

Invest in Canada – Aerospace (http://investincanada.gc.ca/eng/industry‐sectors/aerospace.aspx)

Canadian Space Agency (CSA) (http://www.asc-csa.gc.ca/eng/default.asp)

Provincial: Quebec: Investissement Québec ‐ Aerospace (http://www.investquebec.com/en/index.aspx?rubrique=23) Ontario: Invest in Ontario (http://www.sse.gov.on.ca/medt/investinontario/en/Pages/OS_aerospace.aspx)

A Few Resources

Associations

Aerospace Industries Association of Canada (www.aiac.ca)

Canadian Business Aviation Association (http://www.cbaa.ca/)

Quebec Aerospace Association (www.aqa.ca)

Ontario Aerospace Council (www.ontaero.org)

Aéro Montréal – Montréal’s Aerospace Cluster (http://www.aeromontreal.ca/homepage/)

Media

Wings Canada (www.wingsmagazine.ca)

Plein Vol (www.pleinvol.com)

From Aerospace Associations and Media in Canada

Upcoming Events in Canada

International Conference on Composite Materials (ICCM 19)July 28 - August 2, 2013 in Montréal, Canadahttp://www.iccm19.org/index.htm

Aéro Montréal Aerospace innovation Forum 2013December 2 – 4, 2013 in Montréal, Canadahttp://www.aeromontreal.ca/forum2011-en/

Gina BentoU.S. Commercial Service Montreal [email protected]

Chinese Aviation Manufacturing Org Chart

Chinese Aviation Manufacturing Org Chart

US manufacturers will supply COMAC

Drivers of Aviation Growth

• Planned addition of 55+ airports in the next 5 years

• 100+ to be expanded, 14 relocated, 70 new and 28 planned

• Focus on second- and third-tier cities

• Probable expansion of regional carrier capabilities

Case Study: Airports

• Significantly improve ATC technologies to expand capacity and increase efficiency.

• Low Altitude Airspace Reform accelerating growth of General Aviation

• Political Support for COMAC C919

Policy Support

Bottlenecks Threaten Growth

Infrastructure Human Resources Airspace Constraints Weak Policy & Regulatory

Environment

• 1/3 of all traffic is concentrated in top three airports

• 2/3 concentrated in top 14

• Lack of adequate GA/FBO infrastructure

• Too few pilots and engineers

• Insufficient regulatory manpower & lack of experience

• Unclear laws guiding development of GA

• Military dominates control of airspace

Opportunities Exist

Airport Infrastructure

• Design & Engineering• Baggage System Design• Heavy Equipment

Parts / MRO• Avionics• Metals & Composites• Aftermarket Parts• MRO

Pilot & Engineer Training• FBO Development• PPL Training• Customized Applications

General Aviation• FBO Development• PPL Training• Customized Applications

Take a “China Ready” Assessment Survey :www.export.gov/china

Export Experience

Senior Level Commitment

Financial Resources

Due Diligence

Regulatory Issues

IP Strategy

Is Your Company China Ready?

Aviation Cooperation Program

Public Private Partnership chaired by FAA and Boeing

50+ US corporate members Technical programs with Chinese

counterparts Workshops sponsored by committees

– Leadership & Professional Development– Manufacturing & Airworthiness– Airspace & Environment– Airports– General and Regional Aviation– Airline Economic Regulatory Group

Stronger relationships and increased sales

Upcoming Aerospace Events in ChinaChina Civil Aviation Development ForumMay16-17, 2013Venue: China World Trade Center, BeijingOrganizer: Civil Aviation Authority of China (CAAC)Website: http://www.ccadf.cn/ccadfEN/indexen.htmThe only aviation event organized by the CAAC, China’s largest business & policy event focused exclusively on commercial aviation

MRO Expo China 2013October 16-18, 2013Venue: Xiamen International Conference & Exhibition CenterOrganizer: China Aviation Publishing & Media Co., Ltd. (CAPMC)Website: http://www.aviationmrochina.com/Aims to strengthen international communication and cooperation and serves as a high-level platform for businesses and clients to share their achievements in aviation maintenance.

Air Show China 2014Date: Nov. 11-16, 2012Website: http://www.airshow.com.cn/en/China International Aviation & Aerospace Exhibition (Airshow China or Zhuhai Airshow) is the only international aerospace trade show in China endorsed by the Chinese central government. It features the display of real-size products, trade talks, technological exchange and flying display.

US CS China Contacts

Beijing [email protected] Shanghai [email protected] Shenyang [email protected] Guangzhou [email protected] Chengdu [email protected]

Turkey

Total air travel increased 200% between 2001-2010 Turkish Airlines or THY is the largest player in the market with 7 subsidiaries

including lower cost airlines, MRO, cargo, fuel storage and refueling services and ground services.

Turks are frequent flyers and the number of airlines has doubled in the last 10 years.

61 air taxi operation companies as of 2009; Regional Airlines will ensure further growth. Turkish Airlines, Anadolu Jet,

Pegasus and Bora Jet emphasize the growth of the regional airline market; With a fleet of 181 aircraft, Turkish Airlines has an established growth rate of

11% per year. Passenger load for 2011 reached 32.6 million. By the end of 2011, the number of flight destinations reached 189 (149 international and 40 domestic) from 104 in 2003;

Turkish Airlines flies to the most destinations nonstop from a single airport, than any other European or Middle Eastern airline (the hub being Istanbul).

Maintenance, Repair, Overhaul Turkey is aiming to be an MRO hub catering to markets in Middle-East, N. Africa, Balkans

and Caucasus. Competitive prices compared to other MRO hubs in region (Germany, France, U.K., Singapore). There are 55 countries within a 3-hour flying radius of Istanbul;

Turkish Technic or Turk Teknik is the leading aircraft maintenance, repair and overhaul (MRO) services company in the region with over 3,000 employees, based in Istanbul’s Ataturk Airport. Services include airframe heavy maintenance, engine and APU overhaul, LDG (landing gear) overhaul. Turkish Technic back shops are certified for over 4,000 Boeing and 4,000 Airbus aircraft components.

» Pratt & Whitney-Turkish Technic investment for MRO center $150 million joint venture;

» Goodrich-Turkish Technic, landing systems MRO hub for $5 million expected to reach $20 million investment over next five years;

» Turkish Technic’s HABOM project will create a major MRO center in Sabiha Gokcen Airport. HABOM is estimated to generate $1 billion share of MRO market by 2020.

Key Investments

Airports: Key Projects

Cukurova AirportLocation: Near Mersin, southern TurkeyModel: Turnkey BOT Airport Construction

Third Istanbul AirportLocation: IstanbulModel: Likely BOT Turnkey

Ordu-Giresun AirportLocation: Northern Turkey, in between Ordu and GiresunModel: Turnkey BOT Airport Construction

Various Runway, Taxiway and Apron Construction ProjectsLocation: CountrywideModel: DHMI Tender

Year Satellite Name

Comments

2012 Gokturk II Electro optical reconnaissance and observation

2013 Gokturk I Electro optical reconnaissance and observation

2013 Turksat 4A Communications

2014 Turksat 4B Communications

2015 Turksat 4R Communications

2015 Gokturk III Synthetic aperture radar (SAR)

2016 Turksat 5A Communications

2016 BKZS‐I Infrared early warning satellite

2016 SBIRS Infrared early warning satellite

2017 Turksat 5B Communications

2017 BKZS‐2 Infrared early warning satellite

2018 Gokturk IV Electro optical reconnaissance and observation





2020 Gokturk V Synthetic aperture radar (SAR)

•A total of 17 satellite programs are expected to come into orbit from 2012 to 2020. Over the next five years satellite contracts will amount to $2 billion (projected). •Turkey is setting up a Space Technologies Directorate under the supervision of the Transportation Ministry.

52

Satellite Opportunities

Turkey’s Best Prospects

• Aircraft, aircraft parts • MRO services (maintenance, repair

and overhaul –including airframe/component maintenance, routable logistics and/or fleet management options)

• Pilot Training, equipment & software• Radar and flight control personnel

training• Airport ground support and ancillary

(support) systems(integrated computer systems for air traffic control,engineering and operations)

• ILS Systems/automated landing systems

• Navigation aids• Airport Security Systems

Best Prospect SectorAircraftAircraft Parts

X‐Ray Technology / Airport Security Systems, Mechanical Systems

Satellites

Civil Aviation, Air TrafficControl

Companies and/or Countries

Competition: The Usual Suspects

Events in Turkey and Contact Information

IDEF 2013Istanbul, TurkeyMay 7-10, 2013http://www.idef13.com/en/index.phpRegional event covering defense and aviation

Ozge CirikaU.S. Commercial Service [email protected]+90-312-457-7169

South Korea: 60 Years of Shared Prosperity

In 2013 the U.S. celebrates its 60 year-old alliance with Korea.

It is a partnership of shared prosperity based on a Commitment to Security on the Korean Peninsula

March 15th, 2013 we celebrate the one year anniversary of the Korea-U.S Free Trade Agreement known as KORUS.

Our total bilateral trade increased to $125 billion in 2012. Korea continues to be our 7th largest trading partner.

Commercial Service KOREA

The Korea-U.S. Free Trade Agreement (KORUS-FTA) is at it’s one year anniversary as of March 15, 2013

Summary of the Defense Industry on the Peninsula

South Korea has the 6th largest military in the world and is a major defense/security ally to the U.S.– North Korea has the 5th largest military in the world.

$8.5 billion budget for imports accounting for approx. $1.8 billion (2010).

U.S. has the highest share with 70% of the import market followed by Israel, U.K., and Germany.

Massive defense reforms are underway to transition to a smaller but more capable force structure.

More advanced fighters, surveillance aircraft, naval platforms, and ground combat vehicles are sought

The Republic of Korea’s defense industry budget has been continuously increasing

Source: Business Monitor International, Q1 2013, www.businessmontior.com. South Korea: Defence & Security Report. ISSN 1749-1665

Industry Trends and Developments

Key objectives of the Ministry of National Defense (MND)Optimize indigenous production,Diversify suppliersBolster air and space power; andProcure sophisticated technology in the continual process of modernizing and advancing the Korean defense sector and its exports.Source: Business Monitor International, Q1 2013, www.businessmontior.com. South Korea: Defence & Security Report. ISSN 1749-1665, p. 59

Key Players in South Korea’s Defense Sector Daewoo Heavy Industries and Machinery DSME Hanjin Heavy Industries Hyundai Heavy Industries Korea Aerospace Industries LG Innotek Royal Thales Nederland Samgong Industries Samsung Techwin Samsung Thales Ssangyong Heavy Industries

Source: Business Monitor International, Q1 2013, www.businessmontior.com. South Korea: Defence & Security Report. ISSN 1749-1665, p. 63

INFORMATION ON RELATED ORGANIZATION

DAPA Defense Acquisition Program Administration

MND Ministry of National Defense

ADD Agency for Defense Development

JUSMAG Joint United States Military Advisory Group

PPS Public Procurement Service

http://www.dapa.go.kr/eng

http://www.mnd.go.kr/eng

http://www.add.re.kr/eng

www.pps.go.kr/english/

Some Additional Resources

Korea Aerospace Institutes (KAI) http://www.kari.re.kr/Korea Aerospace University (KAU) www.wkau.ac.kr/ftcKorea’s Country Commercial Guide http://export.gov/southkorea/Korea Economic Research Institute www.keri.orgKorea Statistics http://www.kostat.go.kr/eng/Seoul Air Show www.seoulairshow.com/

U.S. Commercial Service KOREA

Sunny ParkCommercial Specialist, US Embassy Seoul

[email protected]‐2‐397‐4164

U.S. EMBASSY SEOUL COMMERCIAL SERVICE 주한미국대사관상무부

JOIN THE

U.S.A. PAVILION AT SEOUL’s AIR SHOW Seoul ADEX 2013October 29 – November 3, 2013

KINTEX and Cheongju International Airport

Seoul ADEX 2011 included:•Over 314 companies from 31 countries•20,720sqm Stand Area/ 95,000sqm Outdoor Space• 73 Aircraft, 46 Ground Equipment Static Display• 81 Official Delegations from 52 Countries• 100,915 Trade Visitors during Business Days•Indoor Exhibitions•Static Display Aircraft Demonstration / Acrobatic Flights •Demo-Maneuver of Ground Equipment •Conference & Seminars

Contact: Jason SprouleTel: (949) 660‐7105

[email protected]

Singapore

Singapore Government (GOS) adopts liberalized aviation policy and encourages open-air policy

Aerospace is high value-added industry and prioritized for promotion Annual output totaled US$7.25 billion Industry forecasts to grow at 10% annually (projected growth is US$11.5

billion by 2018)

Aerospace Industry Profile

Maintenance, Repair and Overhaul (MRO) dominates 90% of industry output (US$7.25 billion)

Most comprehensive MRO hub in Asia Pacific: 25% share of Asian market & 6% share of global market

Aerospace Industry Profile

World-class aerospace systems manufacturing: engine components, landing gears, aircraft structural components and avionics parts & systems

Diverse aviation-related services including asset management, leasing & flight support

Strong Government support in aerospace R&D

Best Prospects

Great opportunities for most sub-sectors, ranging from:

Aircraft repair equipment for MRO

High value-added aerospace components

Complete sub-assemblies and aircraft systems

Sub-components for aero-engines

Avionics sub-assembly and systems

Prospective Buyers

Major airlines like Singapore Airlines, SilkAir, Tiger Airways, Jetstar Asia and SCOOT + 100 other airlines operating from Changi Airport

Principal MRO stations like Singapore Technologies Aerospace, SIA Engineering Company, SASCO, P&W, GE & Rolls Royce

RSAF (F-5, F-15, F-16, C-130, KC-135, Chinook, Apache, S-70B, Gulfstream 550)

Distribution/Trading outfits servicing the Asia Pacific market

Overview of Singapore’s Defense Industry

Singapore Government (GOS) perceives defense as a necessary

investment for peace & stability and to protect vital interests

Singapore Armed Forces consist: Army, Navy and Air Force

Annual defense budget is capped at 6.0% GDP

FY2013 Defense Budget: US$10.3 billion (S$12.34 billion): an increase of

4.3% over 2012

Best Prospects Great opportunities for most sub-sectors, ranging from:

Integrated systems to enhance interoperability between the three services

High aerial trajectory object detection systems

Unmanned Aerial Systems

Stealth materials/components

Prospective Buyers

Primary Users - Singapore Armed Forces

Defense Science & Technology Agency – procurement & engineering arm of MINDEF

Procurement website – http://www.gebiz.gov.sg

Market Entry

Supply based on Tender specifications by DSTA

Competitive Pricing & Suitability of Equipment/Systems

Sale channels: long term agents/distributors

Financing strategies: L/C up to 120 days credit term

Performance Bonds

Competition

Singapore is a free market economy: any legitimate suppliers are allowed to do business in Singapore

Practically all nationality of defense related suppliers have some forms of establishment in Singapore: own office or representative

Major players include: Raytheon, Boeing, Honeywell, GE, Lockheed Martin, Thales, BAE Systems, Rafael, Soltam, and Pyser.

Singapore Air ShowFebruary 10-14, 2014Aerospace Executive Service Programhttp://export.gov/california/irvine

Market Briefing Daily transportation to and from AESTM hotel and Singapore Air Show; Pre-scheduled meetings with potential partners, distributors, and end users recruited by

the Commercial Service; Access to Official U.S. Pavilion/BIO amenities, including meeting area and shared

business center when not in use for AsiaNow one-on-one appointments; Individual kiosk space (4.0 m²) within the U.S. Pavilion for displaying company literature

and posters and conducting meetings (Floor Plan); Meetings with Commercial Service aerospace and defense industry specialists from U.S.

Embassies and Consulates across Asia; On site assistance from AESTM program coordinator.

NG Haw ChengCommercial SpecialistU.S. Commercial Service SingaporeTel: +65-6476-9037Email: [email protected]: http://www.buyusa.gov/singapore

India

Defense sector—imports 70% of armament needs– World’s leading importer of weapons (since 2011)– Russia ($20b) and Israel ($10b) are lead defense suppliers– US provides $8b under FMS program

India MOD– Department of Defense Production (DDP)– Department of Defense Research & Development Organization

(DRDO)– Department of Ex-Servicemen Welfare – Finance Division

Defense Expenditures

US$42.6 billion defense expenditure by 2015!

Defense Opportunities

Unmanned combat aerial vehicles (UCAVs) Advanced electronic warfare systems Combat systems Rocket and missile systems Fighter and trainer aircraft Stealth frigates Submarines ICT

Factors to Consider

Opportunities• DCS or FMS• Training Institute/University• Partner with private firm to manufacture for gov’t tenders

Obstacles• Lack of professional acquisition workforce in MOD• Lack of transparency• Lack of infrastructure• Shortage of skilled workforce to discharge offsets• Long approval timeframe

Civil Aviation Opportunities

Engineering, Procurement, Management MRO Training Institute/University Lessor for large body, business jet, turbo prop, twin engine, single engine

aircraft Airport operator GA Operator, tier 2-3 cities

Trade Events and CS New Delhi ContactDEFEXPO 2014Pragati Maidan, New DelhiFebruary, 2014http://www.defexpoindia.in

Indian Business Aviation Expo 2013New DelhiNovember 5-6, 2013http://www.miuevents.com/ibae2013

MRO India 2013MumbaiNovember 7-9, 2013http://www.mroindia.com

India Aviation 2014HyderabadMarch 12-16, 2014www.india-aviation.in

Jitender JassalSenior Commercial [email protected]+91 11 2347 2187

United Kingdom

The UK aerospace industry is the largest in in Europe and second to the U.S globally.

2010 market value: $36 billion (est.)

UK aerospace defense sector 2009 turnover: $18.5 b (£11.5 b)

UK civil aerospace 2009 market : est. $17 b (£10.62 b).

UK supply chain includes over 9,000 companies.

The UK aerospace industry involved in major global programs

UK aerospace industry has improved over the last year and has ridden out the storm fairly well compared to many other sectors in the UK.

70% of the revenues are from export markets

* Source: A|D|S

UK aerospace industry sales by customer 2009 (est.)

Space4%

Missiles5%

Aircraft Engines23%

Aircraft Maintenance6%

Defence Aircraft21.2%

Helicopters4.6%

Large Civil Aircra8.7%

Regional Jets2.5%

Aircraft Equipment25%

Other and Business Jets0.4%

aircraft systems & frames37%

Snapshot: UK Aerospace Market

Products in greatest demand in the UK include aircraft systems and frames, engines and equipment.

The UK’s maintenance, repair, overhaul holds 17% market share of a $45 b per year global industry.*

The UK MRO sector has an estimated turnover of $9.6bn – approximately 30% of aerospace turnover

The UK has 8% of the global market share ($120 b globally) in the sector.

Over 450 MRO companies in the UK employing 30,000+

UK growth in the MRO market expected to grow slower than global pace (1.9% estimated)

*Source: ADS

Key UK Aerospace Capabilities

Manufacture of wings Leader in related composite applications Engine manufacturers Manufacturing of military products and subsystems MRO UAVs

Main Competitors: • Airbus (wings)• Rolls‐Royce (engines)

Market Capabilities

• Aircraft systems• Frames• Engines• Equipment

Best Prospects for US Exports

• Farnborough International Air Show– July 14-20, 2014 – www.farnborough.com

• DSEI– September 10-13, 2013– http://www.dsei.co.uk/

• Helitech– September 24-26, 2013– http://www.helitechevents.com/

Major Trade Shows

]A|D|S Group www.adsgroup.org.ukBritish Business and General Aviation Association (BBGA) www.bbga.aeroCivil Aviation Authority (CAA) www.caa.co.ukDepartment for Business, Innovation and Skills (BIS) www.bis.gov.ukDepartment for Transport (DfT) www.dft.gov.uk

UK: Trade Associations

Richard StanbridgeHead of Industry Team

[email protected]+44 (0)20 7894 0419

France is the world’s fifth largestindustrialized economy

In 2009, France’s aerospace industry total turnover of 35.8 billion Euros (civil and air defense) in 2009.

There is still no larger market in the world for US aerospace products than Western Europe as a whole

French firms are interested in procuring in the dollar zone.

European suppliers are both competitors and partners to US firms.

Very strong industrial base : many of the equipment systems firms do business with both Boeing and Airbus

France

Major French Manufacturers

DAHER SOCATA (Daher Group) – light aircraft and business turbopropshttp://www.daher.com/cms/aerospaceEADS ATR – regional turbopropshttp://www.atraircraft.com/home.htmlDASSAULT AVIATION (Falcon Jet) – biz jets and fightershttp://www.dassault‐aviation.com/en/falcon.html?L=1EADS EUROCOPTER ‐ helicoptershttp://www.eurocopter.com/site/en/ref/home.htmlEADS AIRBUS – large aircrafthttp://www.airbus.com/GECI Aviation—light aircraft, formerly Reims Aviationhttp://www.geciaviation.com/en/

France: Sourcing Options

Market Access

Value for Cost

Technical Expertise

Risk Management

France: Opportunities

Civil Aviation vs. Defense– 75% of French aerospace industry concentrated in civilian aircraft

Development Programs– ATR, Eurocopter, Dassault

LEAP Engine

France: Trade Shows

Aeromart Toulouse http://www.bciaerospace.com/toulouse/– Dec 4‐6, 2012– Aeromart consists of one on one buyer/seller meetings

JEC Composites Show http://www.jeccomposites.com/– March 2012 – JEC is Europe’s largest composites show

Paris Air Show http://www.paris‐air‐show.com/– June 2013– The Paris Air Show is one of the world’s largest civil and defense aviation

trade shows.

Ms. Cara BoulesteixTrade Specialist, Aerospace&[email protected]+33 (0)1 43 12 70 79

Germany: Market Overview– EUR 25.7 billion in revenues

– 93,700 direct employees, 850,000 indirect employees throughout supply chain.

– Interests of this major industrial sector are promoted by German Aerospace Industries Association (BDLI – http://www.bdli.de) with 190 member companies (like AIA in the U.S. or GIFAS in France).

– Some BDLI member companies are U.S.-owned (e.g., Northrop Grumman LITEF).

– Solid growth rates between 4.1% (2011); 4.7% (2010) and 12% (2008)

• biggest revenue generator.

– Defense and security grew by 4.6% to EUR 6 billion, 25.4% market share.

– German defense budget, EUR 31.5 billion, 1.4% increase over 2010.

Germany: Market Entry

Access to major aircraft programs– EADS/Airbus

• Target of sourcing 40% outside of Western Europe by 2020!• EADS Airbus Global Sourcing Network (GSN) has been created to

promote globalization of EADS' sourcing footprint.• Nov 2010, joint U.S. procurement office founded by EADS North

America and Airbus Americas (Herndon, Virginia).• http://www.eads.com/eads/int/en/our-company/our-global-

sourcing.html

Germany: Market Access

– Airbus Sites in Germany

– Hamburg: headquarters, final assembly of A318, A319, A321; Centre of Excellence - Fuselage and Cabin, cabin interiors for A320 family and A380, A380 paint shop, A380 major component assembly hall.

– Bremen: Centre of Excellence - Wing/Pylon, design and manufacturing of high-lift systems for the wings for all Airbus a/c.

– Stade: vertical tail planes for all Airbus a/c.

– Buxtehude: Center of Excellence - Fuselage and Cabin, all electronic communications and cabin management systems.

Germany: Market Entry

Tier 1 suppliers– Liebherr-Aerospace Lindenberg GmbH, Lindenberg

Air conditioning and hydraulic actuation systems

– Diehl Aircabin GmbH, Laupheim, joint Diehl Thales company

Cabin and system elements

– Premium AEROTEC GmbH, Augsburg (still part of EADS)

Aerostructures

Wants to become leading Tier I supplier for commercial and military aircraft structures within the next few years.

Germany: Trade Associations

German Aerospace Industries Association (BDLI) http://www.bdli.de German Airport Technology & Equipment http://www.gate-online.org HANSE AEROSPACE e.V. http://www.hanse-aerospace.net ALROUND (Association of Aerospace-oriented SMEs in Germany)

http://www.alround.de

Germany: Major Trade Shows

AERO 2012 http://www.aero-expo.comInternational trade fair for general aviation and ideal stepping stone to enter the European market. The range of exhibits comprises business jets, single and twin-engine aircraft, light aircraft (UL, VLA, LSA), motor gliders, kit planes, helicopters, propulsion systems, components, avionics, and more.

ILA 2012 Berlin, September 11-16 http://www.ila-berlin.de/ila2012/home/index_e.cfmBiennial trade fair and leading marketing platform for the aerospace industry in Continental Europe. The segments are Commercial Air Transport, Space, Defense and Security, International Suppliers Center (ISC), HeliCenter, Unmanned Aircraft Systems, CareerCenter, Conferences.

Aircraft Interiors Expo 2013 Hamburg, April 9-11 http://www.aircraftinteriorsexpo.com

Moritz v. HolstCommercial [email protected]

+49 (89) 2888‐754

Brazil

Total aircraft imports (2012): US$4.7billion (21% increase)

Key Players– Embraer– Helibras

Large fleet of executive aircraft3rd largest helicopter fleet

Market Trends and Market Entry

OEM qualification process

Local agent– Local law firms

Tier 1 and 2 suppliers

Smaller jets– Good for Embraer and US

suppliers to Embraer Azul Trip Airlines: 12 Embraer

planes Latam Airlines: additional 100

aircraft (Boeing and Airbus) 2014 World Cup and 2016

Olympics– Executive aircraft and

helicopters Offshore oil segment

– Helicopter opportunities MRO (US$600million)

– 5-6% expansion

Trade Events and Associations

EXPO AERO BRASILSão José dos Campos July 11-14, 2013http://www.expoaerobrasil.com.br/eab/?lang=enShowcase for products and services ranging from the production of civil and military aircraft to embedded software for space systems.

LABACE – Business Aviation Conference and ExpoSão Paulo August 14-16, 2013http://abag.org.br/labace2013/Labace is the largest business aviation event held in the Southern Hemisphere.

Associations

AIAB – Brazilian Association of Aerospace Industrieshttp://www.aiab.org.br/english/

ABAG – Brazilian Association of General Aviationwww.agab.org.br

CS Brazil ContactsCommercial AviationMarina KonnoCommercial Specialist, CS Sao Paulo [email protected]+55-11-3250-5033

DefenseDaniele AndrewsSenior Commercial Specialist, CS [email protected]+55 61 3312-7458

AirportsGenard BuritySenior Commercial Specialist, CS Rio de [email protected]+55 21 3823-2401

Israeli Aerospace IndustryMajor Companies

• Strong, diverse industry dominated by three main players:

• IAI – Israeli Aerospace Industries (govt‐owned)• Elbit Systems (public company)• Rafael Advanced Defense Systems (govt‐owned)• Many smaller companies. Useful online database of defense companies: en.sibat.mod.gov.il/Industries/Documents/HLS%20Sales%20Directory.pdf

Israel’s Aerospace Industry

9-10% of sales reinvested in R&D Small Domestic Market. Focus on Exports (75-80% of total production) Global Export Markets, strong focus on Latin America (Brazil) and Asia

(India, South Korea) Penetration in overseas markets through partnerships, acquisitions and

subsidiaries. Participation in major trade shows, e.g. Paris Air Show, Asian Aerospace,

FIDAE, DEFEXPO, Aero India, China Aviation, Eurosatory.

Two Sales Tracks(1) FMS

– MOD purchases est. 90% of its military requirements from the USA with U.S. funding.

– Procurements are channeled through MOD Procurement Mission in NY.

– Israeli Prime Contractors; Procurement – 51% US content.– Sale to MOD/IDF; delivery to MOD or to local industry for integration

into system to be delivered to MOD. – Strong recommendation to engage local representative. – No commission to sales representative Exports Controls no obstacle.

Only challenge is time to delivery. – ODC Chief David B. Spencer, Ltd. Col. USAF,

[email protected]; phone: +972-54-2228738

Two Sales Tracks:(2) Direct Sales to Israel Industry

High probability of re-export. Main Challenge is Export Controls, in particular ITAR. End-User Declaration; need to disclose export destination. Time to Delivery. Need for Intricate Internal Tracking System. Increasingly, looking for alternative sources not requiring licensing, e.g.

South Korea, Taiwan.

US Commercial Service Tel AvivIrit van der Veur

[email protected]

Market Entry Strategies

Importance of a local partner

Seek partners/reps in more than one region

Sensitivity to local business culture

Leverage the knowledge and network of the U.S. Commercial Service

Access the supply chain through systems integrators, in addition to contacting the OEMs

Sign up with OEM supplier programs

A few things to keep in mind…

For More In-Depth Aerospace Market Overviews…

U.S. Commercial Service 2013 Aerospace Resource Guide

Market Intelligence from 40 US Commercial Service Aerospace Specialists worldwide

PDF version available at http://export.gov/industry/aerospace/

Contact details of US Commercial Service international aerospace/defense specialists

Your local US Commercial Service Specialist can be located at:

www.export.gov/industry/aerospaceOr

http://export.gov/usoffices/index.asp

[email protected]