On the Record with
WEE SIEW KIM, PRESIDENT, SINGAPORE TECHNOLOGIES AEROSPACE

Ask Wee Siew Kim what most typifies Singapore Technologies Aerospace, and he will reply: "capabilities."

ST Aero is showcasing many new ones here at Asian Aerospace 2000, where the company is unveiling its capability to upgrade the cockpit and avionics of the F-16A fighter.

Next to that, Wee is proudest of ST Aero's growing ability to design, engineer and certify modifications to commercial aircraft. Last October it took a major step in teaming with Boeing to obtain an STC from the FAA for the cargo modification of Boeing 757-200 airliners; ST Aero is primarily responsible for designing the cargo door, and has 40 engineers in Wichita working on the project.

"It is most important that we build a commercial engineering and STC capability," Wee told Show News.

The company, exhibiting here under the umbrella of its ST Engineering parent, was originally formed as the modification and repair center for the Republic of Singapore Air Force (RSAF). It still performs that task, but has developed two major businesses: upgrade and maintenance of military aircraft; and maintenance, repair, overhaul and conversion of commercial airliners, engines and components.

Military upgrades include contracts to modernize F-5 fighters for the RSAF, completion of a batch for an unnamed North Asian country, a number for Venezuela, 48 for Turkey and 48 for Brazil, as well as the internally developed F-16A upgrade program. An upgrade package has been developed for the C-130, and ST Aero will bid on modernizing the cargo fleets of the UAE, Brazil, Colombia and Venezuela.

Commercial business accounted for 48% of ST Aero's revenues of approximately US$540 million last year. It has a total of nine widebody and 16 narrowbody hangars with an annual capacity of about 4.5 million man-hours at its three subsidiaries: SASCO in Singapore, MAE in Mobile, Alabama, and DalFort in Dallas, Texas. Last year its US operations contributed 45% of its total revenues, up from 39% in 1998.

ST Aero celebrates its 10th anniversary this year of entering the US market with its Mobile operation, which has grown from one Boeing 747 hangar to six hangars -- filling every one available on the airport. "We must now build there or go somewhere else," Wee said.

Major milestones in ST Aero's commercial business include last year's agreement with Boeing on the 757-200 cargo conversion, into which Wee expects to invest $10 million over the next two years and achieve revenues of $30 million to $50 million over a three-year period. Launch customer is DHL with an order for 44 aircraft, and ST Aero expects to convert some of the fleet.

Other developments include:

• The opening here at Paya Lebar on Thursday of SASCO's third hangar, allowing extension of DC-10 passenger-to-cargo modification lines from the US to Singapore. Conversions will start here about mid-year, Wee said.

• Delivery of the 50th Northwest Airlines widebody from Singapore last September, just two and a half years since starting maintenance for that airline here.

• Delivery last October of the 1,000th aircraft serviced for Federal Express since ST Aero began looking after the carrier's aircraft in 1991. ST Aero expects to turn around another 150-200 widebody and narrowbody aircraft for FedEx this year.

• "Total" Boeing 737 service with the addition last year of overhaul capability for the CFM56-3 engine, as well as the JT8D-200.

• Increasing market prospects for the component shops in Singapore with additional certification that will allow access to the Japanese market; and overhaul of the first engines from Latin America.
  ST Aero aims to offer more comprehensive services for its customers, such as engineering and maintenance planning, said Wee. "We want to be more of a technical partner-we will be more intimate with our customer and offer a broader, multi-faceted package," he said.

Wee does not see measure ST Aero's international role in terms of manufacturing -- he doesn't even get excited about that prospect unless the company can first design and engineer the project, and then make sufficient profit on the actual tin-bending. A good example is the EC 120 light helicopter, on which ST Aero is a partner with Eurocopter and CATIC/HAMC of China -- after completing its share of design and engineering, ST Aero has subcontracted out all its manufacturing share to AIDC of Taiwan and HAMC and makes none of it at all in Singapore.

By John Morris