By Chan Sue Ling
Jan. 31 (Bloomberg) -- Boeing Co., European Aeronautic, Defence & Space Co. and two of the world’s three largest aircraft engine manufacturers are teaming up for research in Singapore, the first between aircraft and engine makers.
Boeing, EADS, Rolls-Royce Group Plc and United Technologies Corp.’s Pratt & Whitney unit signed today an initial three-year agreement to join a research program by Singapore’s Agency for Science Technology and Research or A*Star.
Singapore has a quarter of Asia’s share of the aircraft maintenance, repair and overhaul services market, which is expected to reach S$12.2 billion ($7.9 billion) in 10 years. The partnership between the four companies will help form the foundation for research needed to achieve the city-state’s bid to become an aerospace hub.
“In the long run, it saves us money from a research and development perspective but more importantly, it improves our products,” Peter Hoffman, director for research at Boeing, said at a media conference today. “We’re co-investing as a group of four in topics of common interest.”
For EADS, the parent of Airbus SAS, such an alliance may help build on its research base in Singapore, which opened last year. The company plans to spend more than S$2 million and employ at least 25 people by the end of 2008, according to Ulrich Schnaut, chief operating officer at the EADS Singapore Research and Technology Center.
Airbus is the world’s largest maker of commercial airplanes, followed by Boeing.
The four will join the Science and Engineering Research Council’s Aerospace program as anchor members, each paying a membership fee of S$200,000 a year. Two projects on airframes and another two on engines will be commissioned in the first year at a cost of about S$5.5 million.
The fees cover about 20 percent of the cost, with the remainder borne by the Singapore agency, said Jasbir Singh, deputy director of the Science and Engineering Research Council.
Members will have full access to the research results developed under the program.
The Singapore agency is in talks with companies including General Electric Co., the world’s biggest jet-engine maker, and ST Aerospace, a unit of Singapore Technologies Engineering Ltd. It plans to also attract smaller companies in the aviation industry to the program.
“The aerospace industry is one of the fastest growing industries in Singapore and in the last 15 years it has grown by a compounded annual rate of more than 12 percent,” Singapore’s Trade Minister Lim Hng Kiang said earlier this month. “The industry is expected to continue its strong growth as the travel sector in Asia picks up.”
Global economic growth and rising Asian demand will lead airlines to buy 1,260 passenger planes with at least 400 seats and 400 giant freighters through 2025, Airbus has estimated.
International passenger traffic in Asia is projected to grow at an average annual rate of 5.7 percent between 2006 and 2010, surpassing the 4.8 percent estimated global traffic growth, according to the International Air Transport Association, which represents about 260 airlines.