x Abu Dhabi, UAESaturday 20 January 2018

German firms are air zone's first tenants

Three aerospace companies to set up shop at Al Ain International Airport special zone.

Three German aerospace firms have signed deals with the Abu Dhabi Airports Company (ADAC) to be the first tenants in the US$1 billion (Dh3.67bn) aerospace zone at Al Ain International Airport. Memoranda of understanding were signed with Aircraft Electronic Engineering, Aerotech Peissenberg and MT Aerospace to build plants to produce avionic systems and aerostructures at Al Ain.

ADAC is planning the industrial zone in partnership with Mubadala Development, an investment arm of the Abu Dhabi Government, which will build a composites manufacturing plant on the site. The three deals followed an official signing with the Bavarian Aerospace Cluster (bavAIRia) to form a strategic partnership with the new Al Ain zone. Under the deal, bavAIRia will advise zone management on setting the centre up with low energy and labour costs, full foreign ownership and a mobile labour force.

"We are delighted to welcome three such highly regarded companies," said Khalifa al Mazrouei, the chairman of ADAC. Further agreements to set up facilities in Al Ain are expected later in the week with UK companies, as well as Mistral Engines, an aircraft engine maker based in the US and Switzerland that specialises in alternative fuels. ADAC officials said the centre could be incorporated as a free zone with its own laws and regulations, but details on its structure were still being worked out.

More than $1bn will be invested in the next three to five years by ADAC, Mubadala, local government entities and private equity sources, possibly including public-private partnerships. Talks with bavAIRia began in February, said Zeyad al Majed, the senior project adviser of ADAC. Mr al Majed said key selling points were the strength of Germany's export economy and Bavarian aerospace in particular, where companies on average exported ?250,000 (Dh1.27 million) worth of products for each employee.

ADAC said Aircraft Electronic Engineering would develop a production site for electronic and avionic devices in Al Ain, while Aerotech Peissenberg planned to focus on making complex components for aircraft engines and industrial gas turbines, and would also build a centre for making engine parts. MT Aerospace, will also build a production centre for aerostructures in Al Ain. The Al Ain cluster is also looking to include aircraft maintenance and the air cargo and logistics industry, and deals are expected soon with some of the emirate's biggest players, including Mubadala and Abu Dhabi Aircraft Technologies.