Market insights

Clear skies ahead for Singapore’s aerospace industry

26 March 2018

The aerospace industry continues to present great opportunities for Singapore. Boosted by the tailwinds of increased global passenger traffic and aircraft demand, the outlook for our MRO, manufacturing and aftermarket sectors have never looked better.

Playing to our strengths: cementing Singapore as a manufacturing and MRO hub

Singapore is currently one of the world’s leading Maintenance, Repair and Overhaul (MRO) hubs, responsible for 10 per cent of the global output. We are home to a big and diverse cluster, with over 130 companies providing a whole range of services for engines, components, avionics as well as aircrafts. Major industry players like Airbus, GE Aviation and Rolls-Royce have significant footprints in Singapore. The long-term presence and investments of these companies, together with continued expansion of local companies like SIA Engineering Company and ST Aerospace denote trust in the trajectory of Singapore’s aerospace sector.

The Singapore Airshow in February saw more than 1,000 companies from 50 countries showcasing their most innovative products and solutions in the aerospace industry.

The recently concluded Singapore Airshow in February is an added testament to our position as a regional hub for the global aerospace community. The biennial event hosted 65 of the world’s leading aviation companies as well as new exhibitors like Aviation Learn, Boom Supersonic and Honda Aircraft. Over four trade show days, more than 1,000 companies from 50 countries and regions used the opportunity to showcase their most innovative products and solutions, and announce new investments and exciting collaborations. All these underscore Singapore’s role as a trusted partner to help companies capitalize on the growth opportunities in Asia and shape the industry’s future.

Prime location

Asia Pacific is well-reported to take off and become the world’s largest aviation market – it will account for 37 per cent of the global fleet in the next 20 years – Singapore’s location, coupled with its links both to the world and to the region, becomes more attractive to companies.

Singapore is seen as one of Rolls-Royce’s strategic regional hubs. In the Singapore Aerospace 2017 report published by Global Business Reports, Mr Bicky Bhangu, Director of Rolls-Royce Singapore, affirmed the importance of Singapore’s links to the region. He said: “Over half of our civil aerospace order books come from Asia and the Middle East, so it’s important for us to have a presence that’s close to our customers. We understand the importance of a regional hub to the success of our customers’ operations.”

Digital transformation

The aerospace sector is also exploring more Industry 4.0 and automated solutions to continually stay competitive. In fact, Singapore is the top-ranked Asian country coming in first for digital infrastructure (EIU Connecting Capabilities: The Asian Digital Transformation Index 2016) and hence, is well positioned to support companies looking into how digital technologies can transform their businesses.

To understand what Smart MRO looks like, one only needs to look at ST Aerospace’s big push. The aerospace arm of ST Engineering and the world’s largest MRO provider, ST Aerospace aims to leverage data analytics to bring new solutions like predictive maintenance and inventory processes to their customers. The company is also using drones for improved aerial aircraft inspection and fabricating spare parts through additive manufacturing methods to achieve better cost and time efficiencies.

Strong manufacturing base

Manufacturing will continue to be a key strategic sector in Singapore’s economic development. Our strong manufacturing base and skilled workforce is the reason why many Original Equipment Manufacturers (OEMs) have set up their base of operations here to serve the Asia-Pacific region.

For example, Singapore is one of two Pratt & Whitney facilities in the world to manufacture hybrid metallic fan blades for the Geared Turbofan™ (GTF) family of engines. The design architecture of these engines is a game changer when it comes to fuel performance and generating a smaller noise footprint. Likewise, GE Aviation will be investing S$42 million in a new facility at Seletar Aerospace Park to manufacture high pressure compressor vanes for the GE9X engine. The GE9X engine is the only one used to power Boeing’s 777x aircraft that is expected to enter into service in 2020.

Thales, one of the world’s biggest suppliers of avionics suites, has a newly expanded facility in Changi that consolidates all its avionics production and MRO activities in one central place. These synergies have made this Singapore facility the largest centre for avionics maintenance and repair services worldwide. Working in collaboration with these OEMs strengthens our manufacturing expertise and gives our engineers new capabilities, in turn helping Singapore maintain its leadership position in the region.

Skilled workforce

As of 2017, the aerospace industry employed 21,000 people with the majority in high-skilled job roles. Mr Tan Kong Hwee, Executive Director of Transport Engineering, Singapore Economic Development Board (EDB) shares how Singapore is developing the future workforce in the aerospace industry.

“To ensure Singaporeans are equipped with relevant skills that would allow them to take on the new job scopes and employment opportunities, the government has in place a number of programmes and initiatives. This includes the Skills Framework for Aerospace and the SkillsFuture Enhanced Internship Initiatives,” he said.

Mr Tan Kong Hwee, Executive Director of Transport Engineering, EDB shares that the Skills Framework for Aerospace and the SkillsFuture Enhanced Internship Initiatives are some of the programmes available to equipped Singaporeans with relevant skills in the aerospace industry.

The Skills Framework provides important information about various aerospace sub-sectors, career pathways, occupations and 86 job roles, as well as existing and emerging skills required to take on those opportunities. It is essentially also a career roadmap, designed to empower individuals to pursue career growth opportunities within the aerospace sector.

Our polytechnics and Institutes of Technical Education (ITE) are also working closely with participating companies to offer SkillsFuture Enhanced Internships that aim to offer greater exposure to the industry with more structured learning outcomes.

Kong Hwee also added that each year, about 2,000 engineering students enrol in aerospace courses at our ITE, Polytechnics and Universities. “We have a healthy pipeline of skilled aerospace talent entering the workforce every year.”

Extending our range: providing nose to tail aftermarket services

Singapore is able to attract a diverse group of industry players and be a one-stop shop for all perceivable aviation needs.

“Singapore offers nose-to-tail aftermarket capabilities that include airframe maintenance, engine overhaul, structural and avionics systems repair, as well as aircraft modification and conversion. These core competencies, coupled with our commitment to quality and safety, have made Singapore a reliable location,” Kong Hwee explained.

One part of the value chain in the aftermarket services is pilot and technical training. The Airbus Asia Training Centre in Singapore is the regional headquarters for pilot simulator training and the largest of its kind in the world.

Pilot and technical training is also part of Singapore’s aftermarket capabilities.

Another example would be ST Aerospace, which is moving into the passenger-to-freighter conversion business. The company has developed systems for several aircraft platforms, and currently has an agreement with Airbus to convert its A320s and A330 carriers and another agreement with Boeing for the 757s and 767s. ST Aerospace also owns businesses like Aeria Luxury Interiors and DRB Aviation. These companies specialize in luxury interiors, and engineering and certification projects for these interiors.

Destination: the aerospace city of the future

In a first of its kind global study by fDi (the intelligence portfolio of The Financial Times), Singapore was named inaugural Aerospace City of the Future for 2016/17. Singapore outperformed other cities with regards to investment in the aerospace industry and overall foreign direct investments. With new developments like Changi East Industrial Zone and Changi East T5 on the horizon, Changi Airport will be able to handle up to 135 million passengers per annum. By offering a twin mix of stability and innovation needed for the long haul, Singapore is ensuring that we are well-positioned to maintain our leadership position as a leading aerospace city for now and the future.