ADAC And bavAIRia Sign A Twin Cluster Agreement To Create A World-Leading Aerospace Center In Al Ain, Abu Dhabi

A co-operatian agreement to further develop the aerospace industries of UAE and Bavaria

The United Arab Emirates today took an important step towards the development of a major aerospace centre, with the signing of an agreement between the Abu Dhabi Airports Company (ADAC) and bavAIRia, the Bavarian aerospace cluster. The agreement sets the foundation to develop a mutually beneficial aerospace partnership between both regions. It was signed by HE Fahed Al Shamesi on behalf of Khalifa Mohamed Al Mazrouei, Chairman of ADAC, and Dr. Martin Haunschild, President of bavAIRia, in presence the Bavarian Minister for Economic Affairs, Infrastructure and Technology Katja Hassel at a special ceremony held at the Paris Air Show, Le Bourget.

The twin cluster agreement will support the development of Al Ain Aerospace cluster located adjacent to Al Ain International Airport. Core to the twin cluster agreement concept are so called joint teams. These have been established to explore joint business opportunities within key areas of common interest including technology fields such as aero engines, aero structures, VIP interiors, satellite navigation applications, education & training. For each of these technology fields, a joint team has already been or will be established and consist of the respective leading Bavarian aerospace companies as well as organisations of the United Arab Emirates. The Joint team “aero engine MRO & small parts manufacturing” includes companies such as Atena, Aerotech Peissenberg, FAG Aerospace and MTU Aero Engines. The joint team “aerostructures” includes for instance MT Aerospace, RUAG Aerospace and SGL Carbon. The agreement will also be supported by a joint ADAC-bavAIRia steering committee to facilitate the flow of knowledge, human capital, and investment across the two regions.

HE Khalifa Mohamed Al Mazrouei, Chairman of ADAC, said: “The signing of the twin ship agreement today with the Bavarian Aerospace cluster is a monumental step forward for both the free state of Bavaria and for the UAE. German aerospace companies want to expand their global presence and reduce their manufacturing costs, increase their profitability and compete in the global economy. On the other hand Al Ain aerospace industry is at its infancy, the costs are low and the business environment is globalized and well funded.

“We hope that through this historic twin cluster agreement, we not only help us to achieve our strategic goals, but allow the companies of Bavaria to expand their international presence and successfully compete in the global economy.

“Given the small size of our population and the standard of living in the UAE, it becomes clear that our diversification strategy must cover high value-add, science and technology based sectors such as aerospace manufacturing. Add to that the fact that we hold one of the largest aircraft procurement programs in the world, it is no wonder that the government has identified the aerospace sector as one of its strategic investment targets.”

Speaking at the signing ceremony, Zeyad Al Majed, Senior Project Advisor of ADAC, spoke of the need for Abu Dhabi to build upon its existing aerospace sector to help diversify its economy and exports away from oil and oil based products, as outlined in Plan Abu Dhabi 2030, the wider strategy for economic development across the Emirate. He said: “The German aerospace companies and notably Bavairan aerospace companies have an average export of about 250,000 euros per employee, with the highest record we have seen exporting at a half a million euros per employee. Bear in mind that these are manufactured goods, not diamonds or gold, but metal, glass and resin parts, crafted to such precision and standards that only a highly educated, skilled and disciplined workforce can achieve. Bavaria also has an efficient cluster management organisation which gives us assistance in the cooperation process and facilitates getting in touch and working together with the Bavarian aerospace companies.”

Together with the Government of Abu Dhabi, ADAC has committed to key economic enablers to support the development of this important sector at Al Ain. These include the control of inflation and base cost within the cluster, to provide a moderate cost of doing business with long term predictability; the provision of a competitive and efficient business and legislative environment that allows for full foreign ownership and freedom of labour movement; and the facilitation of the necessary industrial financial instruments to enable the growth of industrial aerospace activities.

ADAC is also committed to providing the UAE national workforce with the best environment to build discipline and competency alongside their German counterparts, while keeping a commercially minded business environment that does not impose national workforce quotas, but rather encourages and incentivises them.

Speaking on behalf of the Bavarian Aerospace Cluster, Dr. Martin Haunschild, President of bavAIRia, said: The UAE are the ideal partner for Bavaria. With investments USD $255 billion to be spent on investments in major developments in the Emirate in the next five years and a strong commitment to its long term future by investing in various high tech industries, especially in aerospace, the UAE is already emerging as a central aviation hub with enormous growth potential. Via the establishment and development of their own industrial capabilities, the UAE – and especially the Emirate of Abu Dhabi – are already the leading Aerospace region within the Middle East.

“Bavaria is today one of the leading aerospace regions worldwide with more than 35,000 employees and an annual turnover of USD $9 billion. The strength of Bavarian aerospace comes from the strong and heterogeneous industry base with leading aerospace companies along the whole supply chain, together with world-class car manufacturers, special machinery manufacturers, IT and electronic companies. These industries complement and support our aerospace industry. Cooperation within and between industries is further enhanced by forward thinking cluster initiative supporting 19 industry clusters with high strategic importance for the Bavarian economy.”
Dr. Haunschild continued:

“This twin cluster agreement is already much more than just a ‘paper’. It is the mutual commitment and expression to cooperate, to join forces in several aerospace technology fields and to bridge a mutually beneficial partnership for the future. Our ambition is to identify and realise mutually beneficial business opportunities and structure them in a joint action plan.”

The aerospace cluster will be established in Al Ain, the second largest city in the Emirate of Abu Dhabi. The Cluster will be located on a 25km2 area of land adjacent to Al Ain International Airport. Al Ain is strategically located in the centre of the UAE, making it ideally situated to serve the Middle East, Asia Pacific and African markets.

The twin cluster agreement will be followed over the next four days by the signing of several Memorandum of Understandings with companies from Germany, the United Kingdom and the Unites State of America. These include the signing of four MoU’s from companies within Bavaria including Telair International, MT Aerospace, Aerotech Peissenberg and Aircraft Electronic Engineering.

The Paris Air Show is a biannual event that runs until 21 June 2009 at Le Bourget Airport, Paris. The show brings together the world’s leading organisations in the aviation and aerospace industry, from airports and airlines to manufacturers and subcontractors. ADAC are exhibiting at in Hall 4, stand no: E46.

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