International Opportunities in the and Defense Sector

Presented by Mathew D. Woodlee Senior International Trade Specialist U.S. Commercial Service – Minnesota www.export.gov/minnesota

Melissa Grosso Senior International Trade Specialist Global Aerospace & Defense Team Leader U.S. Commercial Service – Connecticut www.export.gov/connecticut Why Export?

. Increased sales and profits

. Overcoming low growth in the domestic marketplace

. Minimizing the effect of seasonal sales fluctuations

. Exploiting technology and expertise in foreign markets

. Achieving economies of scale

. Grow your business

. Keep up with the competition

• 96% of all customers reside outside the USA Who’s Exporting…?

Small- and medium-sized enterprises! • 97% of U.S. exporters are SME’s

• Represents 30% of total export value

• Most export to only 1 foreign market

• Most have fewer than 20 employees U.S. Free Trade Agreements (FTAs) FTAs reduce barriers to U.S. exports, and create a more stable and transparent trading and investment environment, making it easier and cheaper for companies to export their products and services. U.S. FTA Partner Countries

. . Bahrain . Chile . CAFTA-DR (Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, & Nicaragua) . Colombia . . Jordan . Morocco . NAFTA: & Mexico . Oman . Panama . Peru . . South Korea Basic Requirements for Exporting

• An exportable product or service

• A competitive advantage

• The finance to take it to the marketplace

• A commitment in making the export project work Your International Team Must be:

• Flexible • Committed to travel • Work Independently • Good “Ambassadors” • Technologically Proficient • Culturally Sensitive National Export Initiative

. More exports = more jobs - Through the National Export Initiative (NEI), President Obama has announced a goal of doubling exports within five years to support two million job in America

. Government support - To help achieve this goal, the Export Initiative will provide more funds, focus, and cabinet- level coordination to grow U.S. exports. - This is the first time the will have a government- wide export-promotion strategy with focused attention from the president and his Cabinet Federal Agencies and the Trade Promotion Coordinating Committee

. Trade Promotion Coordinating Committee is taskforce of 20 agencies focused on coordinating government-wide export promotion through 7 core agencies:

– U.S. Department of Commerce – U.S. Export – Import Bank – Overseas Private Investment Corporation – U.S. Trade & Development Agency – Small Business Administration – Department of State – Department of Agriculture U.S. Commercial Service

. The U.S. Commercial Service provides U.S. companies unparalleled access to business opportunities around the world. . As a U.S. Government agency, we have relationships with foreign government and business leaders in every key global market. . Our trade professionals provide expertise across most major industry sectors, in all major and emerging markets . We offer fee‐based services to U.S. companies to help them expand international sales of U.S. made products and services U.S. Commercial Service – Located in 120 cities in over 75 countries

Algeria China Portugal Algiers Beijing Berlin Dublin Kuala Lumpur Lisbon Stockholm Argentina Chengdu Dusseldorf Israel Mexico Qatar Buenos Aires Guangzhou Frankfurt Jerusalem Guadalajara Doha Bern Australia Shanghai Munich Tel Aviv Mexico City Taiwan Melbourne Shenyang Ghana Monterrey Bucharest Kaohsiung Sydney Colombia Accra Florence Tijuana Taipei Austria Bogota Greece Milan Morocco Moscow Thailand Vienna Costa Rica Athens Rome Casablanca St. Petersburg Bangkok San Jose Guatemala Japan Vladivostok Turkey Brussels Croatia Guatemala City Nagoya The Hague Saudi Arabia Ankara Zagreb Honduras Osaka‐Kobe New Zealand Dhahran Istanbul Tegucigalpa Sapporo Wellington Jeddah Izmir Belo Horizonte Prague Tokyo Nigeria Riyadh Brasilia Denmark Hong Kong Jordan Lagos Senegal Kiev Recife Copenhagen Hungary Amman Dakar United Arab Emirates Rio de Janeiro Dominican Budapest Kazakhstan Oslo Serbia & Abu Dhabi Sao Paulo Republic Almaty Pakistan Montenegro Dubai Bulgaria Santo Domingo Ahmedabad Kenya Islamabad Belgrade Sofia Ecuador Nairobi Karachi Singapore London Canada Quito Calcutta Korea (South) Lahore Singapore Uruguay Calgary Egypt Chennai Seoul Panama Slovak Republic Montevideo Montreal Alexandria Hyderabad Kuwait Panama City Bratislava Venezuela Ottawa Cairo Mumbai Kuwait City Peru South Caracas Toronto El Salvador New Delhi Lebanon Lima Cape Town Vietnam Vancouver San Salvador Indonesia Beirut Philippines Johannesburg Hanoi Chile Finland Jakarta Libya Manila Ho Chi Minh City Santiago Helsinki Iraq Tripoli Madrid Baghdad Warsaw Paris How We Can Help Whether you are looking to make your first export sale or expand to additional international markets, we have the expertise you need to identify and penetrate foreign markets. . Trade Counseling . Market Intelligence . Business Matchmaking . Due Diligence . Trade Events . In‐Country Promotion of Your Products or Services . Commercial Diplomacy

Access Determine Identify Key Implement Export Sales Markets Export Plan Readiness Potential

Overcome Challenges Export Counseling

. Export Documentation & Regulations . Export Finance Resources . Identifying Schedule B/HTS Numbers . Vetting/Due Diligence on Foreign . Foreign Tariffs/Taxes Parties . . Identifying Foreign Markets Inco‐terms and How to Get Paid . International Shipping & Logistics . Finding Agents, Distributors, Reps, etc. . Certificates of Origin . Trade Shows and Events . Leveraging Trade Agreements & . Finding International Buyers Free Trade Zones . International Marketing Strategies . Foreign Import Requirements . Export Finance Resources . Export Controls Aerospace & Defense Sales Issues . International Traffic in Arms Regulation (ITAR): – Directorate of Defense Trade Controls, Department of State

pmddtc.state.gov

. Export Administration Regulations (EAR) – Department of Commerce, Bureau of Industry & Security

www.bis.doc.gov

. Foreign Military Sales (FMS) – Department of Defense, Defense Security Cooperation Agency

www.dcsa.osd.mil Market Intelligence

. Country Commercial Guides - Leverage reports, prepared annually by U.S. Embassy staff, containing information on the business, economic and political environments in foreign countries

. Foreign Market Conditions - Industry‐specific market research reports and analysis - Country‐specific tariff, tax and regulatory information

. International Demand Forecasting – Data mining and predictive analytics – Target foreign markets with highest demand for your products International Partner Search (IPS)

. You provide your marketing materials and background on your company

. We utilize our network of international contacts to interview potential partners and provide you with a list of pre-qualified candidates.

. Save valuable time and money by working only with pre-qualified international candidates that are interested in selling your products and services.

. Obtain high-quality market information on the marketability and sales potential for your products and services. Gold Key Matching Service (GKS)

. Pre-screened appointment schedule arranged for you before you travel overseas

. Customized market and industry briefings with our local trade specialists at U.S. Embassies and Consulates

. Timely and relevant market research

. Post-meeting debriefing with our trade specialists and assistance in developing appropriate follow-up strategies

. Help with travel, accommodations, interpreter service, and clerical support, etc. International Company Profile (ICP)

Determine whether an overseas company or individual is a suitable partner: - Management details

- Business activities

- Product/service lines

- Financial condition

- Credit-worthiness

- Trading experience

- Market coverage

- Business connections in the target country. Single Company Promotion (SCP)

. This service provides support and official sponsorship in a specific market under the auspices of the American Embassy or Consulate. – Product launches – Technical seminars – Networking receptions

Held in a well recognized location, such as a hotel or in some cases, the U.S. Ambassador's residence.

A typical event might include a 3-hour program with an introduction by a U.S. Government official followed by detailed company presentation and question/answer session followed by a networking session. Trade Shows/Trade Missions

. International Trade Shows – U.S. pavilions put you in the best international trade shows with access to thousands of buyers. – one-on-one meetings with potential buyers.

. International Buyer Program (IBP) – U.S. Department of Commerce selects leading domestic trade shows to promote through its global network of offices and contacts. – U.S. Commercial Service staff in our Embassies and Consulates abroad recruit and bring delegations of qualified buyers, prospective representatives and distributors to domestic trade shows. – U.S. Commercial Service staff then facilitates meetings between buyers and exhibitors.

. International Trade Missions – Opportunity to meet with distributors, government and industry officials, prospective customers, and U.S. Embassy officials. Commercial Diplomacy Level the international playing field for your company

. Overcome trade obstacles to successfully enter international markets. . Access U.S. government trade advocacy for your foreign government procurement bids.

- Visits to key foreign officials by high-ranking U.S. officials

- Direct support from U.S. officials stationed overseas

- Letters to foreign decision-makers Global Aerospace and Defense Team

. Over 200 members worldwide . Supporting over 21,000 clients in over 3,800 aerospace and defense related organizations . Nationally partnering with 5 official CS partners and collaborating with 4 others . Self funded activities Sample of Team Activities

. Client Development, buyer, seller match making . External (private sector) industry training for team members . Topical Webinars . Trade Missions . Global Matchmaking Receptions . Show-Time: trade counseling by country at major trade shows . Large Networking Events . Customized value-added services for US Exporters . Market Research . Partnership Development . Export Controls Seminars

www.export.gov/industry/aerospace Aerospace And Defense Markets To Be Covered

. Canada . China . France . Germany . India . Israel . Singapore . South Korea . Turkey Canada Key Facts about Canada’s Aerospace Industry

General Overview •In 2011, it generated approximately $22 billion •14 largest aerospace companies generate 51% of jobs and account for 65% of payroll •Key clusters are Montreal, Quebec (approx. 55% of the Canadian market) and Ontario (approx. 18%)

Civil Aircraft Sector •83% of output is from civil aircraft manufacturing; military is 17% •In the U.S., military is 56% of output, civil is 44% output

International Trade •Over 82% of production is exported •Over 50% of production is sold to the U.S.

The Canadian aerospace market is uniquely well positioned for capturing a significant portion of the next generation aircraft’s production Canada is Home to Leading Aerospace Players

Canadian American European Composition of the Canadian Aerospace Market

Source: http://www.aiac.ca/canadas‐aerospace‐industry/industry‐statistics/ Canada’s Aerospace Sub‐Sectors

Avionics and Aircraft and Engine and Simulations and MRO Electrical Space Aircraft Parts Engine Parts Training Systems

Esterline Innotech Rolls Royce MDA Bombardier CAE CMC Execaire Canada Corporation Electronics

Bell Pratt & Helicopter StandardAero Whitney Mechtronix Air Data ABB Bomen Textron Canada

Lockheed Systems Eurocopter Turbomeca Martin Canada Canada Trends on Canadian Aerospace Market

Emerging Markets Green Technology MRO Centers •Demand for civil aircraft that • Canada has several established cannot be met by domestic •Green Aviation Research and Development Network (GARDN) MRO hubs in provinces like manufacturers ‐ Chinese Manitoba and Quebec nationals alone are reportedly looking to purchase 200 business •Thriving composites industry •Most airlines state that they aircrafts have underinvested in MRO activity – positioning Canada as •Major Canadian aerospace a leading global MRO hub •Higher demand for single aisle manufacturers expect their • Canada has a vast engine MRO aircraft with less than 200 seat aircraft nitrous oxide emissions capability, ranging from small capacity ‐ Canadian aerospace and noise levels to be reduced by turbo shafts and turbo tops to manufacturers’ core competency 80% and 50% respectively large turbo fan engines Canada and US Defense Procurement

U.S. companies can bid on Canadian Canada First government projects Defense (www.merx.com) Strategy

The Canadian ITAR Exemption http://www.law.cornell.edu/cfr/text/22/126.5

Defense Production & Development Sharing Agreement A Few Resources From the Canadian Government

 National:  Industry Canada – Aerospace and Defense (http://www.ig.gc.ca/eic/site/ad‐ad.nsf/eng/home)  Invest in Canada – Aerospace (http://investincanada.gc.ca/eng/industry‐sectors/aerospace.aspx)  Canadian Space Agency (CSA) (http://www.asc-csa.gc.ca/eng/default.asp)

 Provincial:  Quebec: Investissement Québec ‐ Aerospace (http://www.investquebec.com/en/index.aspx?rubrique=23)  Ontario: Invest in Ontario (http://www.sse.gov.on.ca/medt/investinontario/en/Pages/OS_aerospace.aspx) A Few Resources From Aerospace Associations and Media in Canada

 Associations  Aerospace Industries Association of Canada (www.aiac.ca)  Canadian Business Aviation Association (http://www.cbaa.ca/)  Quebec Aerospace Association (www.aqa.ca)  Ontario Aerospace Council (www.ontaero.org)  Aéro Montréal –Montréal’s Aerospace Cluster (http://www.aeromontreal.ca/homepage/)

 Media  Wings Canada (www.wingsmagazine.ca)  Plein Vol (www.pleinvol.com) Upcoming Events in Canada

International Conference on Composite Materials (ICCM 19) July 28 - August 2, 2013 in Montréal, Canada http://www.iccm19.org/index.htm

Aéro Montréal Aerospace innovation Forum 2013 December 2 – 4, 2013 in Montréal, Canada http://www.aeromontreal.ca/forum2011-en/

Gina Bento U.S. Commercial Service Montreal [email protected] China Chinese Aviation Manufacturing Org Chart Chinese Aviation Manufacturing Org Chart

US manufacturers will supply COMAC

Drivers of Aviation Growth

Policy Support Case Study: Airports

• Significantly improve ATC • Planned addition of 55+ technologies to expand airports in the next 5 years capacity and increase • 100+ to be expanded, 14 efficiency. relocated, 70 new and 28 planned • Low Altitude Airspace Reform accelerating growth • Focus on second- and third- of General Aviation tier cities • Probable expansion of • Political Support for regional carrier capabilities COMAC C919 • 1/3 of all traffic is concentrated in top three airports Bottlenecks Threaten • 2/3 concentrated in top 14 Growth • Lack of adequate GA/FBO infrastructure • Too few pilots and engineers . Infrastructure • Insufficient regulatory . Human Resources manpower & lack of . Airspace Constraints experience . Weak Policy & Regulatory Environment • Unclear laws guiding development of GA • Military dominates control of airspace Opportunities Exist

Airport Infrastructure Parts / MRO • Avionics • Design & Engineering • Metals & Composites • Baggage System Design • Aftermarket Parts • Heavy Equipment • MRO

General Aviation Pilot & Engineer Training • FBO Development • FBO Development • PPL Training • PPL Training • Customized Applications • Customized Applications Is Your Company China Ready?

Export Experience

Senior Level Commitment

Financial Resources

Due Diligence Take a “China Ready” Assessment Survey : Regulatory Issues www.export.gov/china IP Strategy Aviation Cooperation Program

. Public Private Partnership chaired by FAA and . 50+ US corporate members . Technical programs with Chinese counterparts . Workshops sponsored by committees – Leadership & Professional Development – Manufacturing & Airworthiness – Airspace & Environment – Airports – General and Regional Aviation – Airline Economic Regulatory Group . Stronger relationships and increased sales Upcoming Aerospace Events in China

China Civil Aviation Development Forum May16-17, 2013 Venue: China World Trade Center, Beijing Organizer: Civil Aviation Authority of China (CAAC) Website: http://www.ccadf.cn/ccadfEN/indexen.htm The only aviation event organized by the CAAC, China’s largest business & policy event focused exclusively on commercial aviation

MRO Expo China 2013 October 16-18, 2013 Venue: Xiamen International Conference & Exhibition Center Organizer: China Aviation Publishing & Media Co., Ltd. (CAPMC) Website: http://www.aviationmrochina.com/ Aims to strengthen international communication and cooperation and serves as a high-level platform for businesses and clients to share their achievements in aviation maintenance.

Air Show China 2014 Date: Nov. 11-16, 2012 Website: http://www.airshow.com.cn/en/ China International Aviation & Aerospace Exhibition (Airshow China or Zhuhai Airshow) is the only international aerospace trade show in China endorsed by the Chinese central government. It features the display of real-size products, trade talks, technological exchange and flying display. US CS China Contacts

. Beijing [email protected] . Shanghai [email protected] . Shenyang [email protected] . Guangzhou [email protected] . Chengdu [email protected] Turkey Total air travel increased 200% between 2001- 2010 . Turkish Airlines or THY is the largest player in the market with 7 subsidiaries including lower cost airlines, MRO, cargo, fuel storage and refueling services and ground services. . Turks are frequent flyers and the number of airlines has doubled in the last 10 years. . 61 air taxi operation companies as of 2009; . Regional Airlines will ensure further growth. Turkish Airlines, Anadolu Jet, Pegasus and Bora Jet emphasize the growth of the regional airline market; . With a fleet of 181 aircraft, Turkish Airlines has an established growth rate of 11% per year. Passenger load for 2011 reached 32.6 million. By the end of 2011, the number of flight destinations reached 189 (149 international and 40 domestic) from 104 in 2003; . Turkish Airlines flies to the most destinations nonstop from a single airport, than any other European or Middle Eastern airline (the hub being Istanbul). Maintenance, Repair, Overhaul

. Turkey is aiming to be an MRO hub catering to markets in Middle-East, N. Africa, Balkans and Caucasus. Competitive prices compared to other MRO hubs in region (Germany, France, U.K., Singapore). There are 55 countries within a 3-hour flying radius of Istanbul;

. Turkish Technic or Turk Teknik is the leading aircraft maintenance, repair and overhaul (MRO) services company in the region with over 3,000 employees, based in Istanbul’s Ataturk Airport. Services include airframe heavy maintenance, engine and APU overhaul, LDG (landing gear) overhaul. Turkish Technic back shops are certified for over 4,000 Boeing and 4,000 aircraft components.

Key Investments » Pratt & Whitney-Turkish Technic investment for MRO center $150 million joint venture; » Goodrich-Turkish Technic, landing systems MRO hub for $5 million expected to reach $20 million investment over next five years; » Turkish Technic’s HABOM project will create a major MRO center in Sabiha Gokcen Airport. HABOM is estimated to generate $1 billion share of MRO market by 2020. Airports: Key Projects

Cukurova Airport Third Istanbul Location: Near Airport Mersin, southern Location: Turkey Istanbul Model: Turnkey BOT Airport Model: Likely Construction BOT Turnkey

Ordu-Giresun Various Runway, Airport Taxiway and Apron Location: Northern Construction Turkey, in between Projects Ordu and Giresun Location: Model: Turnkey Countrywide BOT Airport Model: DHMI Construction Tender Satellite Opportunities

Year Satellite Comments Name 2012 Gokturk II Electro optical reconnaissance and observation •A total of 17 satellite 2013 Gokturk I Electro optical reconnaissance and observation programs are expected 2013 Turksat 4A Communications to come into orbit from 2014 Turksat 4B Communications 2012 to 2020. Over the next five years satellite 2015 Turksat 4R Communications contracts will amount to 2015 Gokturk III Synthetic aperture radar (SAR) $2 billion (projected). 2016 Turksat 5A Communications •Turkey is setting up a 2016 BKZS‐I Infrared early warning satellite Space Technologies 2016 SBIRS Infrared early warning satellite Directorate under the 2017 Turksat 5B Communications supervision of the 2017 BKZS‐2 Infrared early warning satellite Transportation Ministry. 2018 Gokturk IV Electro optical reconnaissance and observation 2018 BKZS‐3 Infrared early warning satellite 2018 BKZS‐4 Infrared early warning satellite 2019 BKZS‐5 Infrared early warning satellite 2019 BKZS‐6 Infrared early warning satellite 2020 Gokturk V Synthetic aperture radar (SAR)

52 Turkey’s Best Prospects

• Aircraft, aircraft parts • MRO services (maintenance, repair and overhaul – including airframe/component maintenance, routable logistics and/or fleet management options) • Pilot Training, equipment & software • Radar and flight control personnel training • Airport ground support and ancillary (support) systems (integrated computer systems for air traffic control, engineering and operations) • ILS Systems/automated landing systems • Navigation aids • Airport Security Systems Competition: The Usual Suspects

Best Prospect Sector Companies and/or Countries Aircraft Aircraft Parts

X‐Ray Technology / Airport Security Systems, Mechanical Systems Satellites

Civil Aviation, Air Traffic Control Events in Turkey and Contact Information

IDEF 2013 Istanbul, Turkey May 7-10, 2013 http://www.idef13.com/en/index.php Regional event covering defense and aviation

Ozge Cirika U.S. Commercial Service Ankara [email protected] +90-312-457-7169 Commercial Service KOREA South Korea: 60 Years of Shared Prosperity

. In 2013 the U.S. celebrates its 60 year-old alliance with Korea. . It is a partnership of shared prosperity based on a Commitment to Security on the Korean Peninsula . March 15th, 2013 we celebrate the one year anniversary of the Korea-U.S Free Trade Agreement known as KORUS. . Our total bilateral trade increased to $125 billion in 2012. . Korea continues to be our 7th largest trading partner. The Korea-U.S. Free Trade Agreement (KORUS-FTA) is at it’s one year anniversary as of March 15, 2013 Summary of the Defense Industry on the Peninsula

. South Korea has the 6th largest military in the world and is a major defense/security ally to the U.S. – North Korea has the 5th largest military in the world.

. $8.5 billion budget for imports accounting for approx. $1.8 billion (2010).

. U.S. has the highest share with 70% of the import market followed by Israel, U.K., and Germany.

. Massive defense reforms are underway to transition to a smaller but more capable force structure.

. More advanced fighters, , naval platforms, and ground combat vehicles are sought The Republic of Korea’s defense industry budget has been continuously increasing

Source: Business Monitor International, Q1 2013, www.businessmontior.com. South Korea: Defence & Security Report. ISSN 1749-1665 Industry Trends and Developments

Key objectives of the Ministry of National Defense (MND) .Optimize indigenous production, .Diversify suppliers .Bolster air and space power; and .Procure sophisticated technology in the continual process of modernizing and advancing the Korean defense sector and its exports.

Source: Business Monitor International, Q1 2013, www.businessmontior.com. South Korea: Defence & Security Report. ISSN 1749-1665, p. 59 Key Players in South Korea’s Defense Sector . Daewoo Heavy Industries and Machinery . DSME . Hanjin Heavy Industries . Hyundai Heavy Industries . Korea Aerospace Industries . LG Innotek . Royal Thales Nederland . Samgong Industries . Samsung Techwin . Samsung Thales . Ssangyong Heavy Industries

Source: Business Monitor International, Q1 2013, www.businessmontior.com. South Korea: Defence & Security Report. ISSN 1749-1665, p. 63 INFORMATION ON RELATED ORGANIZATION

DAPA Defense Acquisition Program Administration http://www.dapa.go.kr/eng

MND Ministry of National Defense http://www.mnd.go.kr/eng

ADD Agency for Defense Development http://www.add.re.kr/eng

JUSMAG Joint United States Military Advisory Group

PPS Public Procurement Service www.pps.go.kr/english/ U.S. Commercial Service KOREA

Some Additional Resources

.Korea Aerospace Institutes (KAI) http://www.kari.re.kr/ .Korea Aerospace University (KAU) www.wkau.ac.kr/ftc .Korea’s Country Commercial Guide http://export.gov/southkorea/ .Korea Economic Research Institute www.keri.org .Korea Statistics http://www.kostat.go.kr/eng/ .Seoul www.seoulairshow.com/

Sunny Park Commercial Specialist, US Embassy Seoul [email protected] 82‐2‐397‐4164 JOIN THE U.S.A. PAVILION AT SEOUL’s AIR SHOW Seoul ADEX 2013 October 29 – November 3, 2013

KINTEX and Cheongju International Airport

Seoul ADEX 2011 included: •Over 314 companies from 31 countries •20,720sqm Stand Area/ 95,000sqm Outdoor Space • 73 Aircraft, 46 Ground Equipment Static Display Contact: Jason Sproule • 81 Official Delegations from 52 Countries • 100,915 Trade Visitors during Business Days Tel: (949) 660‐7105 •Indoor Exhibitions [email protected] •Static Display Aircraft Demonstration / Acrobatic Flights •Demo-Maneuver of Ground Equipment •Conference & Seminars

U.S. EMBASSY SEOUL COMMERCIAL SERVICE 주한미국대사관 상무부 Singapore

. Singapore Government (GOS) adopts liberalized aviation policy and encourages open-air policy . Aerospace is high value-added industry and prioritized for promotion . Annual output totaled US$7.25 billion . Industry forecasts to grow at 10% annually (projected growth is US$11.5 billion by 2018) Aerospace Industry Profile

. Maintenance, Repair and Overhaul (MRO) dominates 90% of industry output (US$7.25 billion)

. Most comprehensive MRO hub in Pacific: 25% share of Asian market & 6% share of global market Aerospace Industry Profile

. World-class aerospace systems manufacturing: engine components, landing gears, aircraft structural components and avionics parts & systems

. Diverse aviation-related services including asset management, leasing & flight support

. Strong Government support in aerospace R&D Best Prospects

Great opportunities for most sub-sectors, ranging from:  Aircraft repair equipment for MRO  High value-added aerospace components  Complete sub-assemblies and aircraft systems  Sub-components for aero-engines  Avionics sub-assembly and systems Prospective Buyers

. Major airlines like Singapore Airlines, SilkAir, Tiger Airways, Jetstar Asia and SCOOT + 100 other airlines operating from Changi Airport

. Principal MRO stations like Singapore Technologies Aerospace, SIA Engineering Company, SASCO, P&W, GE & Rolls Royce

. RSAF (F-5, F-15, F-16, C-130, KC-135, Chinook, Apache, S-70B, Gulfstream 550)

. Distribution/Trading outfits servicing the Asia Pacific market Overview of Singapore’s Defense Industry

 Singapore Government (GOS) perceives defense as a necessary investment for peace & stability and to protect vital interests

 Singapore Armed Forces consist: Army, Navy and Air Force

 Annual defense budget is capped at 6.0% GDP

 FY2013 Defense Budget: US$10.3 billion (S$12.34 billion): an increase of 4.3% over 2012 Best Prospects

. Great opportunities for most sub-sectors, ranging from:

 Integrated systems to enhance interoperability between the three services  High aerial trajectory object detection systems  Unmanned Aerial Systems  Stealth materials/components Prospective Buyers

. Primary Users - Singapore Armed Forces

. Defense Science & Technology Agency – procurement & engineering arm of MINDEF

. Procurement website – http://www.gebiz.gov.sg Market Entry

. Supply based on Tender specifications by DSTA

. Competitive Pricing & Suitability of Equipment/Systems

. Sale channels: long term agents/distributors

. Financing strategies: L/C up to 120 days credit term

. Performance Bonds Competition

. Singapore is a free market economy: any legitimate suppliers are allowed to do business in Singapore

. Practically all nationality of defense related suppliers have some forms of establishment in Singapore: own office or representative

. Major players include: Raytheon, Boeing, Honeywell, GE, , Thales, BAE Systems, Rafael, Soltam, and Pyser. Singapore Air Show February 10-14, 2014 Aerospace Executive Service Program http://export.gov/california/irvine

. Market Briefing . Daily transportation to and from AESTM hotel and Singapore Air Show; . Pre-scheduled meetings with potential partners, distributors, and end users recruited by the Commercial Service; . Access to Official U.S. Pavilion/BIO amenities, including meeting area and shared business center when not in use for AsiaNow one-on-one appointments; . Individual kiosk space (4.0 m²) within the U.S. Pavilion for displaying company literature and posters and conducting meetings (Floor Plan); . Meetings with Commercial Service aerospace and defense industry specialists from U.S. Embassies and Consulates across Asia; . On site assistance from AESTM program coordinator.

NG Haw Cheng Commercial Specialist U.S. Commercial Service Singapore Tel: +65-6476-9037 Email: [email protected] URL: http://www.buyusa.gov/singapore India

. Defense sector—imports 70% of armament needs – World’s leading importer of weapons (since 2011) – Russia ($20b) and Israel ($10b) are lead defense suppliers – US provides $8b under FMS program . India MOD – Department of Defense Production (DDP) – Department of Defense Research & Development Organization (DRDO) – Department of Ex-Servicemen Welfare – Finance Division Defense Expenditures

US$42.6 billion defense expenditure by 2015! Defense Opportunities

. Unmanned combat aerial vehicles (UCAVs) . Advanced electronic warfare systems . Combat systems . Rocket and missile systems . Fighter and trainer aircraft . Stealth frigates . Submarines . ICT Factors to Consider

Opportunities • DCS or FMS • Training Institute/University •Partner with private firm to manufacture for gov’t tenders

Obstacles •Lack of professional acquisition workforce in MOD •Lack of transparency •Lack of infrastructure •Shortage of skilled workforce to discharge offsets •Long approval timeframe Civil Aviation Opportunities

. Engineering, Procurement, Management . MRO . Training Institute/University . Lessor for large body, business jet, turbo prop, twin engine, single engine aircraft . Airport operator . GA Operator, tier 2-3 cities Trade Events and CS New Delhi Contact

DEFEXPO 2014 Pragati Maidan, New Delhi February, 2014 http://www.defexpoindia.in

Indian Business Aviation Expo 2013 New Delhi Jitender Jassal November 5-6, 2013 Senior Commercial Specialist http://www.miuevents.com/ibae2013 [email protected] MRO India 2013 +91 11 2347 2187 Mumbai November 7-9, 2013 http://www.mroindia.com

India Aviation 2014 Hyderabad March 12-16, 2014 www.india-aviation.in United Kingdom

 The UK aerospace industry is the largest in in and second to the U.S globally.

 2010 market value: $36 billion (est.)

 UK aerospace defense sector 2009 turnover: $18.5 b (£11.5 b)

 UK civil aerospace 2009 market : est. $17 b (£10.62 b).

 UK supply chain includes over 9,000 companies.

 The UK aerospace industry involved in major global programs

 UK aerospace industry has improved over the last year and has ridden out the storm fairly well compared to many other sectors in the UK.

 70% of the revenues are from export markets

* Source: A|D|S UK aerospace industry sales by customer 2009 (est.)

Missiles Space 5% 4%

Aircraft Equipment Helicopters 25% 4.6%

aircraft systems & frames 37% Large Civil Aircr a 8.7%

Regional Jets Defence Aircraft 2.5% 21.2% Aircraft Engines Other and Business Jets 23% 0.4%

Aircraft Maintenance 6% Snapshot: UK Aerospace Market

 Products in greatest demand in the UK include aircraft systems and frames, engines and equipment.

 The UK’s maintenance, repair, overhaul holds 17% market share of a $45 b per year global industry.*

 The UK MRO sector has an estimated turnover of $9.6bn – approximately 30% of aerospace turnover

 The UK has 8% of the global market share ($120 b globally) in the sector.

 Over 450 MRO companies in the UK employing 30,000+

 UK growth in the MRO market expected to grow slower than global pace (1.9% estimated)

*Source: ADS Key UK Aerospace Capabilities

 Manufacture of wings  Leader in related composite applications  Engine manufacturers  Manufacturing of military products and subsystems  MRO  UAVs

. Main Competitors: • Airbus (wings) • Rolls‐Royce (engines) Market Capabilities

Best Prospects for US Exports Major Trade Shows

• Farnborough International Air Show – July 14-20, 2014 • Aircraft systems – www.farnborough.com • DSEI • Frames – September 10-13, 2013 – http://www.dsei.co.uk/ • Engines • Helitech • Equipment – September 24-26, 2013 – http://www.helitechevents.com/ UK: Trade Associations

A|D|S Group www.adsgroup.org.uk British Business and General Aviation] Association (BBGA) www.bbga.aero Civil Aviation Authority (CAA) www.caa.co.uk Department for Business, Innovation and Skills (BIS) www.bis.gov.uk Department for Transport (DfT) www.dft.gov.uk

Richard Stanbridge Head of Industry Team [email protected] +44 (0)20 7894 0419 France

 France is the world’s fifth largest industrialized economy  In 2009, France’s aerospace industry total turnover of 35.8 billion Euros (civil and air defense) in 2009.  There is still no larger market in the world for US aerospace products than Western Europe as a whole  French firms are interested in procuring in the dollar zone.  European suppliers are both competitors and partners to US firms.  Very strong industrial base : many of the equipment systems firms do business with both Boeing and Airbus Major French Manufacturers

DAHER SOCATA (Daher Group) – light aircraft and business turboprops http://www.daher.com/cms/aerospace EADS ATR –regional turboprops http://www.atraircraft.com/home.html (Falcon Jet) –biz jets and fighters http://www.dassault‐aviation.com/en/falcon.html?L=1 EADS EUROCOPTER ‐ helicopters http://www.eurocopter.com/site/en/ref/home.html EADS AIRBUS –large aircraft http://www.airbus.com/ GECI Aviation—light aircraft, formerly Reims Aviation http://www.geciaviation.com/en/ France: Sourcing Options

Market Access

Value for Cost

Technical Expertise

Risk Management France: Opportunities

. Civil Aviation vs. Defense – 75% of French aerospace industry concentrated in civilian aircraft . Development Programs – ATR, Eurocopter, Dassault . LEAP Engine France: Trade Shows

. Aeromart Toulouse http://www.bciaerospace.com/toulouse/ – Dec 4‐6, 2012 – Aeromart consists of one on one buyer/seller meetings . JEC Composites Show http://www.jeccomposites.com/ – March 2012 – JEC is Europe’s largest composites show . http://www.paris‐air‐show.com/ – June 2013 – The Paris Air Show is one of the world’s largest civil and defense aviation trade shows.

Ms. Cara Boulesteix Trade Specialist, Aerospace&Defense [email protected] +33 (0)1 43 12 70 79 Germany: Market Overview – EUR 25.7 billion in revenues – 93,700 direct employees, 850,000 indirect employees throughout supply chain. – Interests of this major industrial sector are promoted by German Aerospace Industries Association (BDLI – http://www.bdli.de) with 190 member companies (like AIA in the U.S. or GIFAS in France). – Some BDLI member companies are U.S.- owned (e.g., Northrop Grumman LITEF). – Solid growth rates between 4.1% (2011); 4.7% (2010) and 12% (2008) • biggest revenue generator. – Defense and security grew by 4.6% to EUR 6 billion, 25.4% market share. – German defense budget, EUR 31.5 billion, 1.4% increase over 2010. Germany: Market Entry

. Access to major aircraft programs – EADS/Airbus • Target of sourcing 40% outside of Western Europe by 2020! • EADS Airbus Global Sourcing Network (GSN) has been created to promote globalization of EADS' sourcing footprint. • Nov 2010, joint U.S. procurement office founded by EADS North America and Airbus Americas (Herndon, Virginia). • http://www.eads.com/eads/int/en/our-company/our-global- sourcing.html Germany: Market Access

– Airbus Sites in Germany

– Hamburg: headquarters, final assembly of A318, A319, A321; Centre of Excellence - Fuselage and Cabin, cabin interiors for A320 family and A380, A380 paint shop, A380 major component assembly hall.

– Bremen: Centre of Excellence - Wing/Pylon, design and manufacturing of high-lift systems for the wings for all Airbus a/c.

– Stade: vertical tail planes for all Airbus a/c.

– Buxtehude: Center of Excellence - Fuselage and Cabin, all electronic communications and cabin management systems. Germany: Market Entry

. Tier 1 suppliers – Liebherr-Aerospace Lindenberg GmbH, Lindenberg

Air conditioning and hydraulic actuation systems

– Diehl Aircabin GmbH, Laupheim, joint Diehl Thales company

Cabin and system elements

– Premium AEROTEC GmbH, Augsburg (still part of EADS)

Aerostructures

Wants to become leading Tier I supplier for commercial and military aircraft structures within the next few years. Germany: Trade Associations

. German Aerospace Industries Association (BDLI) http://www.bdli.de . German Airport Technology & Equipment http://www.gate-online.org . HANSE AEROSPACE e.V. http://www.hanse-aerospace.net . ALROUND (Association of Aerospace-oriented SMEs in Germany) http://www.alround.de Germany: Major Trade Shows

AERO 2012 http://www.aero-expo.com International trade fair for general aviation and ideal stepping stone to enter the European market. The range of exhibits comprises business jets, single and twin- engine aircraft, light aircraft (UL, VLA, LSA), motor gliders, kit planes, helicopters, propulsion systems, components, avionics, and more.

ILA 2012 Berlin, September 11-16 http://www.ila-berlin.de/ila2012/home/index_e.cfm Biennial trade fair and leading marketing platform for the aerospace industry in Continental Europe. The segments are Commercial Air Transport, Space, Defense and Security, International Suppliers Center (ISC), HeliCenter, Unmanned Aircraft Systems, CareerCenter, Conferences.

Aircraft Interiors Expo 2013 Moritz v. Holst Hamburg, April 9-11 Commercial Specialist http://www.aircraftinteriorsexpo.com [email protected] +49 (89) 2888‐754 Brazil

Total aircraft imports (2012): US$4.7billion (21% increase)

Key Players – Embraer – Helibras

Large fleet of executive aircraft 3rd largest helicopter fleet Market Trends and Market Entry

. Smaller jets – Good for Embraer and US suppliers to Embraer . OEM qualification process . Azul Trip Airlines: 12 Embraer planes . Local agent . Latam Airlines: additional 100 aircraft (Boeing and Airbus) – Local law firms . 2014 World Cup and 2016 Olympics . Tier 1 and 2 suppliers – Executive aircraft and helicopters . Offshore oil segment – Helicopter opportunities . MRO (US$600million) – 5-6% expansion Trade Events and Associations

EXPO AERO BRASIL São José dos Campos Associations July 11-14, 2013 http://www.expoaerobrasil.com.br/eab/ ?lang=en Showcase for products and services AIAB – Brazilian Association of ranging from the production of civil and Aerospace Industries military aircraft to embedded software for space systems. http://www.aiab.org.br/english/

ABAG – Brazilian Association of LABACE – Business Aviation General Aviation Conference and Expo São Paulo www.agab.org.br August 14-16, 2013 http://abag.org.br/labace2013/ Labace is the largest business aviation event held in the Southern Hemisphere. CS Brazil Contacts Commercial Aviation Marina Konno Commercial Specialist, CS Sao Paulo [email protected] +55-11-3250-5033

Defense Daniele Andrews Senior Commercial Specialist, CS Brasilia [email protected] +55 61 3312-7458

Airports Genard Burity Senior Commercial Specialist, CS Rio de Janeiro [email protected] +55 21 3823-2401 Israeli Aerospace Industry Major Companies • Strong, diverse industry dominated by three main players: • IAI – Israeli Aerospace Industries (govt‐owned) • Elbit Systems (public company) • Rafael Advanced Defense Systems (govt‐owned) • Many smaller companies. Useful online database of defense companies: en.sibat.mod.gov.il/Industries/Documents/HLS% 20Sales%20Directory.pdf Israel’s Aerospace Industry

. 9-10% of sales reinvested in R&D . Small Domestic Market. . Focus on Exports (75-80% of total production) . Global Export Markets, strong focus on Latin America (Brazil) and Asia (India, South Korea) . Penetration in overseas markets through partnerships, acquisitions and subsidiaries. . Participation in major trade shows, e.g. Paris Air Show, , FIDAE, DEFEXPO, , China Aviation, Eurosatory. Two Sales Tracks (1) FMS

– MOD purchases est. 90% of its military requirements from the USA with U.S. funding. – Procurements are channeled through MOD Procurement Mission in NY. – Israeli Prime Contractors; Procurement – 51% US content. – Sale to MOD/IDF; delivery to MOD or to local industry for integration into system to be delivered to MOD. – Strong recommendation to engage local representative. – No commission to sales representative Exports Controls no obstacle. Only challenge is time to delivery. – ODC Chief David B. Spencer, Ltd. Col. USAF, [email protected]; phone: +972-54-2228738 Two Sales Tracks: (2) Direct Sales to Israel Industry

. High probability of re-export. . Main Challenge is Export Controls, in particular ITAR. . End-User Declaration; need to disclose export destination. . Time to Delivery. . Need for Intricate Internal Tracking System. . Increasingly, looking for alternative sources not requiring licensing, e.g. South Korea, Taiwan.

US Commercial Service Tel Aviv Irit van der Veur [email protected] Market Entry Strategies A few things to keep in mind…

 Importance of a local partner  Seek partners/reps in more than one region  Sensitivity to local business culture  Leverage the knowledge and network of the U.S. Commercial Service  Access the supply chain through systems integrators, in addition to contacting the OEMs  Sign up with OEM supplier programs For More In-Depth Aerospace Market Overviews…

U.S. Commercial Service 2013 Aerospace Resource Guide

. Market Intelligence from 40 US Commercial Service Aerospace Specialists worldwide

. PDF version available at http://export.gov/industry/aerospace/

. Contact details of US Commercial Service international aerospace/defense specialists Your local US Commercial Service Specialist can be located at:

www.export.gov/industry/aerospace Or http://export.gov/usoffices/index.asp

[email protected] 860-638-6955