16 December 2005
	SA aerospace READY FOR TAKEOFF By Peter Honey

Three separate aviation business deals in different parts of the world in the past 10 days will likely spur growth in SA's slowly recovering aerospace industry. The most recent deal is Malaysia's announcement on December 8 that it will buy four new-generation Airbus A400M transport aircraft. It will be the first customer outside the joint European-SA manufacturing consortium to buy the military airlifter, which is still in the construction phase. Earlier in the week, China ordered 150 Airbus A320 jetliners - the largest single order yet made for commercial jet aircraft. SA component manufacturer Aerosud makes galleys, plastic mouldings, wing parts and avionics racks for A320 and other Airbus aircraft, as well as for Boeing airliners. Airbus's SA spokesman, Linden Birns, says an upturn in the air travel industry worldwide, excepting the US, has brought an almost unprecedented rise in airliner orders in recent months. In just the past seven weeks, Airbus has received orders from several air carriers for more than 350 A320s. This will certainly boost SA companies attached to Airbus programmes. Boeing, too, is contracting more work from SA industry, as its order book rises. A day before the Chinese deal was announced, Sweden's Saab Group said its SA-based operation, Saab-Grintek, had signed an agreement to acquire SA avionics company Aerospace Monitoring & Systems (AMS), probably in April 2006. It did not disclose the price, but it is believed to be about R30m. Midrand-based AMS manufactures aircraft monitoring and recording systems for the aerospace and defence markets. It is making "black box" recorders for Hawk trainer jets supplied to the SA and Indian air forces. It has an annual turnover of R58m and employs 75 people. The three deals, though unrelated, have complementary benefits for SA companies. Aerosud and state-owned Denel Aviation are the two primary SA manufacturing partners in the A400M programme. In April SA ordered eight of the aircraft for a reported R6,4bn, and became a risk-sharing partner with seven European countries in the design, development and manufacture of the subsystems and assemblies of the A400M. Members of the consortium have ordered 188 planes, and hundreds more are expected to be built over the 50-year life of the programme. SA's government wants the partnership to serve as a linchpin for the redevelopment of the aerospace industry, and so to nurture the development of technological and engineering capacity and skills in the country. Aerosud CEO Paul Potgieter says his company will be doubling the floor space of its Centurion factory next year to cope with the increasing production load. "The biggest challenge in the longer term is sustainability," he says. "We have to create sustainability through performance excellence."