Denel Aerostructures, Aerosud Aviation & Airbus Forge Industrial and Research Alliance

16 September 2014

Johannesburg, South Africa Denel Aerostructures, Aerosud Aviation and Airbus have finalised a new three-way collaborative agreement that aims to strengthen and sharpen the global competitiveness of South Africas aerospace manufacturing industry and its research & development capabilities.

The new alliance will build on the successful foundation laid down over the past seven years with the two South African companies participating as full industrial partners and key suppliers to the Airbus A400M military transport plane. The A400M is currently in production, with deliveries underway to air forces in Europe some of which have already deployed the aircraft on peacekeeping and humanitarian missions.

Under the strengthened relationship, Denel Aerostructures, Aerosud Aviation and Airbus will jointly develop industrial projects which will enable the South African partners to jointly bid for larger scale manufacturing work packages on Airbus commercial airliner programmes than they have been able to secure independently of each other.

This will provide more long-term sustainable and profitable business for South Africas aviation industry while also supporting the development of SMME suppliers.

Speaking on behalf of Government at the agreement signing ceremony at Denel Aerostructures in Ekurhuleni, the Deputy Director-General for Manufacturing Enterprises at the Department of Public Enterprises (DPE), Mr Kgathatso Thlakudi, said: the partnership underscores the value, talent and capabilities of South Africas aerospace industry and the Denel Aerostructures and Aerosud collaboration gives South Africa a crucial opportunity to reduce its dependency on military aerospace, while also making a step-change in the size and scale of the work that could be undertaken locally.

Mr Thlakudi added that the collaboration creates further opportunities to advance South African expertise and knowledge through joint Research & Development projects with Airbus and its global innovation network. The collaboration will enable Denel Aerostructures and Aerosud Aviation to jointly bid for larger scale manufacturing work packages on Airbus commercial airliner programmes than they have been able to secure independently of each other.

With global demand for air transport continuing to grow by around 5.4% annually, the industry is set to double in size over the next 15 years maintaining a trend that has continued since 1970. To meet this additional demand and to replace older, less efficient aircraft, Airbus predicts a global market requirement for about 30,000 new jetliners in the larger than 100-seat segment over the next 20 years.

The agreement will also see the three partners identify and develop Research & Development projects aimed at giving South Africas aerospace industry a unique competitive advantage as part of its long-term development strategy.

This new approach is in line with the National Development Plan, and further supports Denels business strategy as it opens the door for us to participate on the worlds most modern and successful commercial airliners, while at the same time reducing our dependency on military programmes, said Denel Aerostructures CEO, Ismail Dockrat.

Aerosud Holdings Chairman, Paul Potgieter, said the new working arrangement breaks the mould for South African industry. A steady stream of work on Airbus commercial jetliners has enabled Aerosud to expand its Centurion facilities and create both direct and indirect employment opportunities in South Africa over the past decade. But by working together under this new alliance, Aerosud Aviation and Denel Aerostructures will be able to take on larger work packages that are mutually viable, economically sustainable and with lower risk. Until now, our separate structures and economies of scale have never permitted this, he added.

Airbus Vice President International Cooperation, Simon Ward, said the agreement went beyond supporting Denel and Aerosud. It bolsters the South African Governments strategy for the development of a vibrant and strong indigenous aerospace industry that is also globally competitive, that creates sustainable jobs and drives transformation in the sector. It also builds on the proven and solid foundation we have laid here since 2005 Airbus has committed ZAR4-billion worth of work packages and research projects to South Africa. Airbus currently delivers more than 50 aircraft a month and without continually expanding order book standing at almost 6,000 aircraft to be delivered over the coming years, it is clear to see just how real this opportunity is for South Africa.

Background notes for journalists:

Denel and Aerosud current work on Airbus programmes

Denel Aerostructures is responsible for the design, engineering, manufacture and supply of major components for the A400M, including the top shells (roof panels), the wing-fuselage fairling (the largest single aircraft structural components ever produced in South Africa), the tail fin spar and ribs and the cargo flooring mouts and locks.

Aerosud has similar responsibilities for the galley, the fuselage and cockpit linings and the aerodynamically critical wing-tips.

In addition, Aerosud manufactures the avionics bay racks and wing components for the A320 Family of jetliners. It also produces wing components and the fuselage frame clips for the all-new A350 XWB, the worlds most modern jetliner, which will enter airline service towards the end of this year. These carbon-composite frame clips literally hold the aircrafts skin panels to the skeletal structure of the aircraft body.

Airbuss expanding Research & Development work with South Africa

Over the past eight years Airbus, in partnership with the departments of Trade & Industry and Science & Technology, has nurtured a portfolio of joint research and technology projects with the countrys Council for Scientific & Industrial Research (CSIR), several South African universities and with industry. These on-going projects cover a range of topics, e.g. 3-D printing of large aircraft parts, the use of natural plant fibres in aircraft cabin components, the development of advanced flight control systems, new computational fluid dynamics tools for aircraft design and a study on hydrogen fuel cell technology and their potential use in future aircraft.

About Aerosud

Aerosud is an established leader in the global aviation industry, supplying integrated manufacturing solutions. As a smart supplier, it adds value to partnerships involving programme management, design, development and production processes.

About Denel Aerostructures

With over 60 years experience in the aerostructures market, the company is a leading designer and manufacturer of complex metallic and composite aerostructures for the military and commercial aviation sectors.

About Airbus

Airbus is a leading aircraft manufacturer with the most modern family of airliners, ranging in capacity from 100 to more than 500 seats. Airbus has delivered more than 8,600 aircraft to some 360 customers worldwide and has a backlog of almost 6,000 aircraft, equivalent to eight to nine years of production at current output rates.

Media contacts:

Linden Birns, PR for Airbus, Sub-Sahara Africa

Mobile: +27 (0) 82 568 8031

email: linden@icon.co.za

Heidi Carpenter, Manager, Media Relations, Airbus

Mobile: +33 607 25 64 88

email: heidi.carpenter@airbus.com

Johan Steyn, Managing Director, Aerosud Aviation

Tel: +27 (0)12 662 5010

email: johan@aerosud.co.za

Ismail Dockrat, CEO, Denel Aerostructures

Tel: +27 (0)11 927 2632