Taiwan's Aerospace Industrial Development Corporation (AIDC) forecasts 30-40% growth over the next five years following the completion of corporate restructuring by its new chairman, Tao-Yu Sun.
Sun says expansion of AIDC's civil aircraft unit and a new maintenance business should help the government-owned company achieve NT$16 billion ($470 million) in annual revenues at the end of a new five-year business plan, compared with just under NT$12 billion estimated for 2004. Costs will be cut by 10%, implying reductions in the 3,400-strong workforce.
Sun has already overseen a corporate restructuring programme that began in July with the elimination of 27 of AIDC's 58 divisions. By combining and integrating units, the company is in a better position to identify problems that have long restricted efficiency. "Frankly, we now understand where the problems are," he says.
Sun is looking at a potential privatisation of AIDC within three years, "but at the same time it's difficult to do that until we make the company profitable", he says.
AIDC's military aircraft business, which accounts for about 50% of revenues, is profitable but shrinking. The new maintenance arm, formed in response to an outsourcing trend in Taiwan's military, is set to account for 15-20% of revenues within five years. AIDC has already won a contract to maintain Taiwan's fleet of Bell AH-1W helicopters and is seeking another to maintain AIDC AT-3 trainers. AIDC no longer produces military aircraft, but has several ongoing modification programmes.
AIDC's unprofitable civilian unit supplies components for the Airbus A321, Alenia/Lockheed Martin C-27J, Boeing 717 and 737, Bombardier Challenger 300 and Learjet 45, Dassault Falcon family, Eurocopter EC120, Ibis Aerospace Ae270 and Sikorsky S-92. It wants to drop its participation in the Ae270 programme and renegotiate its C-27J, 717 and Challenger 300 contracts to make room for 7E7 and additional A321 work.
BRENDAN SOBIE / SINGAPORE
Source: Flight International
