Three Main Observations of the Aerospace Industry

I would like to share my three main observations of the aerospace industry.

1. A bigger role for Malaysia in the aerospace industry due to global demand and geopolitics

From my engagements with aerospace industry players, I understand that this industry is experiencing global shifts due to the increase in global demands in the post-Covid-19 era, geopolitics and wars.

With demand for warplanes from global suppliers, these companies have shifted their civilian plane work packages to Malaysia and other neighbouring countries. This increased participation of Malaysian companies in the aerospace industry also translates into more opportunities for Malaysia to grow the local supply chain.

I was told that Malaysia witnessed a dynamic stride in its aerospace industry with an accumulative RM5.7 billion new work packages secured by the local supply chain within the last two years, and RM600 million worth of maintenance, repair and overhaul (MRO) projects currently being implemented by industry players. It is anticipated that the aerospace industry revenue for 2023 will be more than RM18 billion with 28,000 skilled workforce.

2. Grow deeper technology and more sophisticated products, and reach a higher value chain in the aerospace industry

The second point that I observe is that we want to grow deeper and higher in the aerospace industry with more sophisticated products. When I was the Deputy Defense Minister, I was briefed that Malaysia contributed to the composite on the wing of A400M. In my recent visits to the industry, I was told that composite is now used or attempted to be used on the plane body as well. A350 aircrafts use more than 50 percent composite. Composite is used a lot more than before and Malaysia is well-positioned in this space.

I hope we will do more R&D, as a nation, in various parts of the aerospace industry, such as composites, materials, aerospace-related precision engineering and digital technology. This will allow us to grow deeper technology and obtain higher value from the aerospace industry.

3. Sharing wider the fruits of the industrial growth

I hope to see a wider share of the fruits of labour as business opportunities. Particularly, I want to commend NAICO for working together with SOCSO and focusing on career development and opportunities in the aerospace industry. I hope that the Malaysian public will start to appreciate the aerospace industry as an emerging industry, which is also one of the industries highlighted in the New Industrial Master Plan 2030 (NIMP 2030).

This industry holds a great future ahead. We need to strengthen the domestic supply chains to benefit more Malaysian companies where we can grow deeper technologies and more sophisticated products, improve our position in the global value chain and create high-skilled, high-productivity job opportunities. We will then be able to share the fruits with as many Malaysians as possible, both in terms of local businesses and in terms of job opportunities.

This is my speech delivered at the Malaysia Aerospace Summit 2023 (MyAERO Summit 2023) organised by National Aerospace Industry Corporation (NAICO) at Kuala Lumpur Convention Centre on 15 November 2023.

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