Australian aerospace manufacturing is set to undergo a major restructuring, with Boeing confirming plans to purchase Hawker de Havilland (HdH), and both Tenix Defence Systems (HdH's current owner) and BAE Systems Australia planning radical revamps.
A shake-out of the Australian industry, prompted by a marked downturn in domestic defence and aerospace markets, is led by Boeing's swoop for HdH, first revealed in Flight International, 10-16 October. The purchase should be finalised within four weeks, with no price-tag yet disclosed.
The take-over means Boeing will dominate Australia's aerospace integration and military and civil aerostructure components manufacturing sectors. HdH has sites in Sydney and Melbourne, with customers including Airbus, Boeing, Bombardier and Lockheed Martin. It had sales of $A160 million ($85 million) in its 1999-2000 financial year, but is trading at a loss. HdH and Boeing's AeroSpace Technologies of Australia (ASTA) Component business, based in Melbourne, will now team up to bid for Australian defence sub-contracts.
Documents seen by Flight International reveal that Tenix will merge its naval and aerospace divisions after the sale, while its land systems and support division will be split up after failing to win Australian Army business.
A new systems division willbe established in Adelaide around the former Vision Systems, acquired by Tenix this year. The division will support business units focused on electronic warfare, simulation and surveillance and reconnaissance.
Though Tenix is exploring investment in other sectors, and has shed 100 jobs from its naval shipbuilding operation in the last 10 weeks, it claims it has no plans to exit defence. Senior sources indicate it will continue to pursue aerospace work, including a joint bid with AgustaWestland offering that company's A129 International for the Australian Army's armed reconnaissance helicopter project.
A memo from Tenix Defence Systems managing director, Andrew Johnson, says changes in Australia's defence business environment "have made it necessary to restructure". Johnson says Tenix remains "the most significant defence business in Australia", and that the changes "are intended to maintain this leadership position." Tenix will be "under pressure", he says, until Australia relaxes defence spending controls. Much hinges on a defence white paper due out in December. Johnson says that Tenix will now "seek international business", aim to "control its costs" and "remain viable" while retaining "key strengths to be ready for renewed business flows".
Meanwhile, BAE Systems Australia will close facilities at Technology Park in Adelaide and Meadowbank in western Sydney as it exits a number of business areas. The construction of a new $A35 million facility in Melbourne will proceed, but it will be leased rather than be occupied by the company.
The firm's managing director, Peter Anstiss, says in a leaked memo that it will focus on (control, command, communication and computers systems, intelligence, surveillance and reconnaissance systems, electronic warfare and integrated software, missiles and decoys, and flight training, exiting "other business streams after completing current orders."
Source: Flight International
