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Please see attached for Kim Eng's view of SIA Engineering. Smile
Latest report by Kim Eng on SIA Engineering (see attached)
And the full report...
Business Times - 20 Sep 2011

27,800 new planes needed by 2030: Airbus

It forecasts doubling of global passenger fleet to 31,500 with booming demand


(SINGAPORE) The demand for commercial aircraft will keep soaring, with Airbus predicting in its latest Global Market Forecast (GMF) that some 27,800 new planes will be required by 2030 to satisfy market demand.

The combined value of the over 26,900 passenger aircraft (above 100 seats) and more than 900 new factory-built freighters forecast by the GMF is US$3.5 trillion.

This means that by 2030 the global passenger fleet will more than double from today's 15,000 aircraft to 31,500.

This will include some 27,800 new aircraft deliveries, of which 10,500 will be needed to replace older, less fuel-efficient aircraft.

'The trend towards larger aircraft will continue, in order for the aviation sector to keep pace with future growth in demand,' said the maker of the A380 superjumbo.

'People need and want to fly more than ever before. Over the next 20 years, the aviation sector is expected to remain resilient to cyclical economic conditions as in the past.'

Eighteen customers, including Singapore Airlines, have ordered 236 Airbus A380 planes.

Airbus forecasts that revenue passenger kilometres (RPKs) will grow an average of 4.8 per cent per year, which is equivalent to traffic more than doubling in the next 20 years.

Factors it cites for driving demand for new aircraft include population growth with increasing wealth, dynamic growth in emerging economies, strong continued growth in the North American and European markets, greater urbanisation and a more than doubling in the number of mega cities by 2030.

Drivers also include the ongoing expansion of low- cost carriers (LCCs), and the need to replace older, less efficient aircraft with new eco-efficient models in established markets.

Not surprisingly, Asia-Pacific will dominate demand, accounting for approximately 34 per cent in the next 20 years.

This will be followed by Europe (22 per cent) and North America (22 per cent). By share of passenger traffic, Asia-Pacific will be the biggest market with 33 per cent, followed by Europe (23 per cent) and North America (20 per cent).

'The aviation sector is an essential element for today's global economy, which is why more people than ever need and want to fly,' says John Leahy, Airbus chief operating officer (customers).

By 2030, 60 per cent of the world's population or some five billion people will be urbanised and the number of mega cities will have more than doubled to 87 from today's 39. So Airbus forecasts that over 90 per cent of long-haul travellers will fly between these mega city points.

It sees demand for Very Large Aircraft (VLA) seating more than 400 passengers, like the A380, rising to 1,781 aircraft valued at US$600 billion, or 17 per cent share by value or 6 per cent share by aircraft units.

Regionally, some 45 per cent of the world's VLAs will be delivered to Asia, 19 per cent to Europe and 23 per cent to the Middle East.

In the twin-aisle aircraft segment (seating from 250 to 400 passengers), some 6,900 new passenger and freighter aircraft worth some US$1.5 trillion will be delivered in the next 20 years, doubling today's fleet.

'Of these, some 4,800 aircraft will be small twin-aisle (250 to 300 seater) and about 2,100 intermediate twin-aisles (350 to 400 seater),' Airbus said. It sees these segments covered by the A330 and the A350 XWB family.

Boeing has its B787 and B777s competing with Airbus.

In the single-aisle segment, nearly 19,200 aircraft worth some US$1.4 trillion - 40 per cent share by value, 69 per cent share by units - will be delivered in the next 20 years. This is an increase over previous forecasts due to increased growth and acceleration in the replacement of older, less efficient aircraft.

Of the new deliveries, some 40 per cent will be required as replacements. Airbus said half of the single-aisle aircraft deliveries will go to the well established aviation markets of North America and Europe.

Airbus is sitting on 995 orders for its A320 and A320neo, including 562 orders taken during the 2011 Paris Airshow.

The Straits Times
Sep 20, 2011
Engine-maker to launch delayed Seletar project

Pratt & Whitney to build future Asian HQ, put off after 2008 recession

By Karamjit Kaur

GLOBAL aircraft engine-maker Pratt & Whitney, which had delayed plans for a new facility at Seletar Aerospace Park after the 2008 recession, is ready to launch the project.

Construction will start in the first quarter of next year and the facility - the firm's future headquarters for its Asian business and customers - will be completed within a year, a spokesman told The Straits Times.

Pratt & Whitney came to Singapore in the mid-1980s and currently has an operation here that spans eight business units, including a joint venture with SIA Engineering.

The group employs more than 2,300 staff in Singapore.

With Asia leading growth in the global aviation and aircraft maintenance, repair and overhaul industry, Pratt & Whitney expects to also grow its business in Singapore and the region, the spokesman said.

Next year, Singapore-based Eagle Services Asia, Pratt & Whitney's largest commercial aircraft engine overhaul facility, will be the first to work on the new PW1000G engine.

The spokesman said: 'This designation as the first PW1000G engine overhaul provider constitutes expansive investment in Singapore and a mark of growing global confidence in the country.'

Meanwhile, rival Rolls-Royce is already one step ahead.

The British power systems and engines giant has completed construction of a sprawling new $700 million hub in Seletar which will house three facilities - a factory to make engine fan blades for large aircraft, a regional training centre, and a plant to assemble and test engines.

The new facilities by the two engine- makers are part of plans to turn the area around Seletar Airport into a key global and regional aerospace hub.

Other firms based there are ST Aerospace, Jet Aviation, Hawker Pacific and Fokker Services.

Australian firm Hawker Pacific is building a $15 million, 9,400 sq m facility which will be more than three times bigger than its existing maintenance, repair and overhaul facility, also in Seletar.

The private jet centre, as the plant will be known, will be the biggest of Hawker Pacific's 10 facilities based in the region.

More than five years after the Government unveiled plans to transform Seletar - a former military airbase - into a key aerospace hub, lead agency JTC Corporation has completed one key project and is still working on another.

A new $14 million, seven-storey building has been erected to house companies now operating mainly out of old hangars, said a JTC spokesman. It should be about half occupied by the year end, she said.

Two out of seven new factories being built are also ready, the agency said.

To support the growing needs of Seletar tenants, the Civil Aviation Authority of Singapore and Changi Airport Group recently completed work to lengthen the runway by 250m to 1.84km.

The new runway will allow the airport to support larger jet operations as well as heavier take-off loads.
I thought the likely company to benefit will be Boustead since they have been building aerospace facilities for rolls royce and other aerospace companies.

Quite likely they will get the job?
Building hangars requires specialized skills? If not odds are the cheapest contractor will get their job...
(20-09-2011, 09:12 AM)yeokiwi Wrote: [ -> ]I thought the likely company to benefit will be Boustead since they have been building aerospace facilities for rolls royce and other aerospace companies.

Quite likely they will get the job?

Hi yeokiwi,

Yes it's likely Boustead may get the job. They already signed a contract with Hawker Pacific some time back, and Bell Helicopters as well. Let's hope the regional expansion for these aerospace players means more business for them in terms of DB&L contracts.

Hi piggo,

These facilities require specialized structures which Boustead is good at. It's a niche industry and Boustead has been doing this for a long time with a good track record (bio-tech, aerospace and also logistics companies).
SIA Engineering will be releasing its 1H FY 2012 financials on October 28, 2011 (Friday) after market close.

I will need to take a close look at bottom line year-on-year, and also to observe if the Company continues to generate healthy FCF, and if the bulk of it continues to be from its JV and Assoc companies.

I also look forward to an interim dividend of hopefully 6 cents/share (1H FY 2011: 6 cents/share). Smile

October 28, 2011, 6.45 pm (Singapore time)

SIAE's Q2 net profit up, declares 6 cts/shr dividend


SIA Engineering on Friday announced that its net profit for its second quarter ended Sep 30, 2011 has increased from S$66.5 million a year ago to S$71.2 million.

Its revenue fell from S$277.1 million a year ago to S$272.4 million due to from lower revenue from materials.

The company has declared interim dividend of 6 cents per share, payable on Nov 29, 2011.

The company expects demand for its businesses in the near term to remain stable. Nevertheless, global economic will impact recovery of the aviation industry.

It said it will be vigilant on cost and efficiency management.

On the business side, its broad range of services and network of joint ventures will place it in an advantageous position to continue to capitalise on growth opportunities.
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