Dubai Air Show signals aviation upturn

In many ways the show, organised by F&E Aerospace, had already defied the odds, attracting its biggest-ever exhibitor turnout of 890 companies from 47 countries, some 150 of them new-to-market, and 13 country and regional pavilions.

Together they spanned four halls, including the new 7,000 square metre temporary Emirates Hall, while 130 aircraft, an intriguing mix of next-generation passenger airlines, the most luxurious of VIP jets and military air might filled the static park, including the newest and most advanced US fighter jet, the F-22 Raptor.

It was a pervading sense that this show perhaps more than any other, being the Middle East's foremost aerospace event and the world's fastest growing, could witness a revival in aerospace industry fortunes that attracted a record turnout of a powerful, and influential, 800-plus international media corps.

And their anticipation was backed up by His Highness Sheikh Ahmed Bin Saeed Al Maktoum, President, Dubai Department of Civil Aviation and Chairman of Dubai Airports, who sounded a rallying call as the show opened, clearly positioning the UAE at the forefront of the expected upturn.

"We are open to ideas: we are ready to work with companies in partnership," Sheikh Ahmed said in his welcome address, going on to describe the show as timely and on the cusp of a business upturn.

"It is the Middle East - and the GCC in particular - that has seen a growth in air transport, while elsewhere there have been falling passenger numbers. It is in the Gulf that we have seen launch customer deliveries of some of the finest business jets. It is Middle Eastern carriers that have been leading the way with the introduction of new cabin and in-flight communication technologies. It is also in this region that we see the greatest investment in ground infrastructure, such as airports and air traffic management systems."

Sheikh Ahmed added that the region's, and most notably the UAE's, investment in sophisticated defence systems is providing a secure landscape and delivering reassurance to investors.

And the aerospace audience was not to be disappointed as the show quickly proved to be a weathervane for the aviation industry and a fertile platform igniting cross-border business.

"New participants came from the UAE, Saudi Arabia, the UK and USA and covered a range of activities from training simulators, to the world's first planned supersonic business jet, from VIP and specialised aircraft services to suppliers of ejector seats and unmanned aerial vehicles. The scale and scope of opportunity was hugely diverse and the prevailing sentiment on the exhibition floor was one of business innovation," said Alison Weller, Director or F&E Aerospace.

A highlight of the show's new blood was the L-15 Falcon advanced jet trainer from China's AVIC which was making its international aerospace exhibition debut.

A joint show opening by Their Highnesses Sheikh Mohammed Bin Rashid Al Maktoum, UAE Vice President and Prime Minister and Ruler of Dubai and Sheikh Mohammed Bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, prompted industry observers to comment on the region's changing industry dynamics.

The eve-of-show announcement by Abu Dhabi's Mubadala Development Company that it would open an advanced composite aero structure manufacturing unit in the emirate's second city of Al Ain was seen as a forerunner of things to come.

The coming of age of an indigenous Arabian aerospace industry brought a new dimension to industry players - one which, according to visitor Ravi Darira of India's RaviRaj Process Control, many ancilliary suppliers had failed to foresee.

"It is a good show but largely dominated by the big ticket manufacturers. I came looking for ancillary products and believe the ancillary suppliers are missing a trick by not being here in greater numbers. This is a region where sales are taking place and which is moving into its own in the industry yet not enough ancillary industry players are here to take advantage," he said.

The addition of a new hall and increased entry points led to ease of visitor access and wider aisle-ways brought smoother footfall traffic throughout, providing a higher conducive scenario for B2B negotiations.

"The show was flawless from an organisational point of view and we were able to receive a Lebanese military delegation to further talks with them which actually began at the 2007 show. From an exhibitor point of view, one of the great things about this show is the ease of getting in and out," said Willis J. Brown, VP Business Development, Alsalam Aircraft Company, Saudi Arabia.

Over the show's five days, 52,978 industry professionals attended from 138 countries with a noticeable increase in visitors from the emerging North African states - a trend reflected in the onsite orders placed. The final visitor tally showed an 18% rise in attendee numbers and an outreach to seven additional countries compared to 2007.

While the UAE accounted for the largest country share it represented less than a third of the overall tally at just over 17,000. The impressive turnout included 511 civil and military delegations, including Ministers of Defence, presidents and CEOs of airlines and chairmen of civil aviation authorities.

"Most significant was the fact that the delegation and visitor numbers were steady throughout all five days - right up until the end, our delegations officers were busy organising tours and meetings," said Weller.

Members or ruling and royal families from throughout the Gulf and Middle East featured strongly in the delegation line-up - and throughout their tours they gave valuable insights into their future needs.

UAE Minister for Higher Education, His Excellency Sheikh Nahyan Bin Mubarak Al Nahyan said a number of training affiliations would result from his visit.

"A highly trained and skilled cadre of technology professionals is essential to our country as it looks to build an indigenous aerospace industry," he said. "We are having talks at the show to progress training affiliations and which will definitely result in collaboration agreements. This, of course, is necessary as the UAE steadily progresses its own solid human resource infrastructure of aviation and aerospace professionals."

The result was a declared on-site order book in excess of $14bn, covering sales of civil airliners and military trainers, helicopters, aircraft engines, in-flight systems, simulators, wheels and brakes and petrol-driven helicopters, as well as contracts covering heavy maintenance agreements, crew management processes and cabin refits.

Civilian order highlights included: Airbus deals with Ethiopian, Nepal, Senegal and Yemenia airlines, as well as the Swiss-based luxury charter jet company Comlux and Air Austral; Rolls-Royce engine contracts with Air China and Ethiopian Airlines; a range of deals from Abu Dhabi's Etihad Airways worth $750m; JorAMCo heavy maintenance wins from Tailwind Airlines and Thomas Cook; an Oman Air order for five Embraer aircraft; Boeing sales to two Algerian airlines and Sikorsky's sale of two S-76D helicopters to the UAE's Falcon Aviation Services.

DAE Capital took final day headlines with its $40m order - one of a total $1bn series the company placed at the show - this time for wheels and carbon brakes for its planned Boeing 737 fleet. The order went to Messier-Bugatti of France.

The UAE's PERLA Aviation, meanwhile, buoyed by the sale of three of its petrol-powered AK1-3 light aircraft to customers in Pakistan, India and the UK, was confident of follow-on show business.

"It has just been excellent for us with strong interest from throughout the Middle East, Africa, Europe and the USA," said PERLA's Tanya Rashenko. "We are also negotiating an additional three sales leads gained here which we hope to conclude in the coming weeks. Enquiries came from a wide breadth of sectors - private operators, the government sector and even from the film industry."

The much-awaited military deals came late in the show when the UAE GHQ announced orders for two SAAB 340 early-warning aircraft and for 25 Pilatus basic training PC-21 aircraft. The deals are being seen as a precursor of further defence orders to come.

"The UAE Air Force & Air Defence is currently evaluating several options to purchase permanent solution command and early-warning aircraft to meet the UAE Armed Forces operational requirements," an official statement said.

Military alliances were also top of mind for His Royal Highness Prince Feisal Bin Hussein, Special Assistant to Jordan's Joint Chief of Staff, who confirmed he was at the show for talks of "an undisclosed military nature."

"I am here for three days to progress various discussions I have been charged with and it has been most useful having all the relevant companies here at the show," he said.

Deals at the show, though the signature headlines, were underpinned by announcements which indicated that the long-awaited industry upturn had arrived.

Dubai's Emirates Group joined hands with the Senegalese Government to support the carrier, which is due to begin operations next year and has a majority private sector shareholder base. The alliance followed a high-level meeting at the show between Emirates' Chairman and CEO, His Highness Sheikh Ahmed bin Saeed Al Maktoum and His Excellency Karim Wadem, Senior Minister, Ministry of International Co-operation, National Planning, Air Transport and Infrastructure of Senegal. Under the alliance, the Emirates Group will assist the airline in both its start-up and post-launch phases with commercial and technical expertise, training and aviation-related goods and services.

And all the signs are that the show's and the region's sustainability remains intact and will continue its industry-leading role.

The Middle East, while suffering some slowdown from the global recession, has defied international trends and continues to deliver exceptional growth - a situation not lost on Boeing.

"We see tremendous growth for the Middle East region, and Middle East carriers are well-positioned to meet those growth requirements with the fleet capacity they have in the form of unfilled orders, or backlog," said Randy Tinseth, Vice President Marketing, Boeing Commercial Airplanes.

The US aircraft maker has forecast a requirement among Middle East carriers for 1,710 new aircraft, valued at $300bn over the next 20 years. In terms of size, Boeing projects a Middle East market for 970 twin-aisle aircraft, expected to account for around 50% of the demand, and a market for 680 single-aisle airplanes, around 40%, with the remaining 3% being made up of demand for regional jets with fewer than 90 seats.

And it may not be long before the demand is converted into reality with visitors to the show saying fleet assessments are under way.

Among them was Ali Al-Ghamdi, Manager Fleet Planning of Saudi Arabian Airlines, bent on talks with the key aircraft manufacturers.

"We have finalised our fleet renewal strategy for air cargo operations and I visited to meet possible solution providers. I spent two days at the show and it was excellent. I had a number of business meetings, outlined our strategy and requirements and these providers will now be coming to Jeddah to present their solution proposals. We will then assess them before presentation to the Board for selection," he said.

As the show drew to a close, bookings for Dubai Airshow in 2011 began with Mubadala Aerospace being the first to sign up. Indications were also strong that more new blood could be entering the profile, as some visitors looked to convert their status to exhibitors.

"I came basically to asses the show, and the market, as I have never been before," explained Mark Kelsey of Dunlop Aircraft Tyres of the UK. "It has been extremely productive as we have found new contacts and notice a trend here within the airlines. Although they have smaller fleets, they have volume business as their planes are busier. We are seeing an upturn in business coming out of the Middle East and Africa which we believe will be a long-term trend and so we would consider participating in 2011."

The Chinese market, according to one visitor, is now waking up to the Middle East potential. "We are looking to expand our sphere of influence into the Middle East and I came to assess this show. We have taken part in shows in China, throughout Asia and Russia but this is the best I have ever seen. I believe there is huge opportunity here for Chinese companies to make good contacts throughout the Middle East so I will be exhibiting here in the future, in fact I think you will see quite a number of Chinese companies coming into the show," said Sha Wei, General Manager, Shenyang Avias Aviation Maintenance Engineering Company Ltd., China.

And for first-time exhibitors, the testing of the show and the marketplace proved indispensable.

"It has been just great. We have had a lot of interest in our services from the wider Middle East region, Europe and the US and absolutely business will result," said Tom Brown, Senior Sales Manager, Skyplan of Canada.

"We go to four airshows in the US and we have done more business in one day here than we do at a full show there. Really it has been beyond our expectations and has been outrageously fantastic for a new guy on the block. We will absolutely be back, in the same location because return-on-investment that is coming out of being here is substantial."

F&E Aerospace anticipates sales pushing ahead more quickly for 2011 with companies wishing to take advantage of its prize freeze on exhibitor space which continues until the end of 2010.

The next Dubai Airshow will be held at Airport Expo, Dubai, from 30 October to 3 November 2011.