InvestSA

Aerospace & Defence

Overview

The South African aerospace and defence industry is globally competitive and strives to be a preferred choice for aerospace and defence-related solutions on the African continent. The industry is successfully integrated into South Africa’s wider industrial landscape. It has helped to expand the national science, engineering and technology base and has supported the technical and technological skills base. In addition, it has successfully entered the global market through its exports to and global partnerships with many of the world’s leading aerospace and defence OEMs and Tier-1 /Tier-2 companies.

Value proposition

An increased overlap between products intended for defence and civilian use, both nationally and internationally, means the technological intensity of the sector acts as a driver for new technologies and technical skills that are diffused to other sectors. In other words, there are broad investment opportunities in a range of activities.

Opportunities

Aerospace and defence have moved beyond simply supplying the needs of the South African army, navy and airforce, though opportunities clearly still exist in this area.

The aerospace industry in South Africa also covers commercial and military aviation; air traffic management; aircraft materials, parts and components; system manufacturing; integration; propulsion avionics; sensors; ICT systems; maintenance, refurbishment and overhaul; and research and technology, including university- and science-council-based fundamental research into new technologies and materials e.g. titanium and composites for light structures.

In military land-based armaments and equipment, South Africa has expertise in building armoured vehicles. According to website Defenceweb, quoting unverified statistics form he National Conventional Arms Control Committee, the South African defence industry exported R1.5 billion worth of armoured vehicles in 2017 and billions of rands worth of additional hardware, from missiles to grenade launchers.

the dti has identified as key opportunities, among others:

  • Ramping up cluster development and investment in the Centurion Aerospace Village aero-mechanical cluster and special economic zones. The village houses facilities to produce the AHRLAC, a light reconnaissance and counter-insurgency aircraft developed locally by AHRLAC Holdings, a joint venture between the Paramount Group and Aerosud.
  • Forging synergy with national champions or state-owned companies in leveraging on their acquisitions to boost local manufacturing and broaden their supply chains.
  • Increasing the strategic profile and business relationships with original equipment manufacturers (OEMs) such as Airbus, Boeing and Embraer.
  • Unlocking current incentive programmes.
  • Positioning the local industry as a one-stop shop for defence solutions for the African continent and as a preferred African partner.
  • Maintenance, refurbishment and overhaul of aerospace and defence products.
  • Development of the National Flagship project, the Small African Regional Aircraft.