United Arab Emirates - Country Commercial Guide
Aerospace and Aviation

This is a best prospect industry sector for this country. Includes a market overview and trade data.

Last published date: 2022-01-08

Overview

The civil aviation sector is a vital contributor to the UAE’s economy and pre-pandemic, the industry supported nearly 800,000 jobs in 2019, contributing $47.4 billion to the economy, roughly 13.3% of the UAE’s GDP. While the pandemic was a severe shock to the aviation sector, it remains a key sector of the overall economy. The UAE has two major airlines, Dubai-based Emirates and Abu Dhabi-based Etihad Airways.

UAE Government Initiatives

UAE government initiatives and investment in the aerospace industry have driven robust demand for business partnerships and helped the UAE outpace other regional markets. These initiatives include the  offset program, industrial clusters, university programs, etc.  Such initiatives boosted the signing of contracts for new manufacturing and maintenance, repair, and overhaul (MRO) projects in the UAE in support of the country’s long-term strategy for transformation into a knowledge-based economy.

Impact of COVID-19

The COVID-19 pandemic has greatly disrupted the UAE’s aviation sector, and continues to have a significant impact on airline operations and profitability.

Travel and tourism in the UAE took a big hit from the sudden drop in traffic and lockdowns across the world. Despite efforts to cut costs and stimulate demand, aviation leaders in the UAE predict a recovery to pre-pandemic levels will not arrive before 2023.

Airline and Airport Growth

In recent years, the four major UAE carriers expanded their operations and investments, including Dubai-based Emirates Airline (full-service carrier since 1985), Abu Dhabi-based Etihad Airways (full-service carrier since 2004), flydubai (low-cost carrier since 2009), and Sharjah-based Air Arabia (low-cost carrier since 2003). The UAE has seven international airports including Dubai International Airport (DXB), one of the world’s largest and busiest international airports, and Abu Dhabi International Airport (AUH).  Abu Dhabi formed partnerships to create budget airlines such as Wizz Air Abu Dhabi and Air Arabia Abu Dhabi.

The UAE government invested heavily in airport development and expansion projects such as $8.1 billion in Al Maktoum International Airport in Dubai, $7.6 billion for the Dubai International Airport Expansion Phase 4, $6.8 billion for Abu Dhabi Airport development and expansion plans, and around $400 million in Sharjah’s International Airport terminal expansion.  Airports are under pressure to reduce costs and delay large capital expenditures, leading to cancellations and delays in new projects.  Airports in the UAE continue to leverage new technologies to enhance the passenger experience and their role as a gateway. 

In terms of aircraft fleets, Emirates Airlines operates 268 widebody aircraft - 153 Boeing 777 aircraft and 115 Airbus 380 aircraft.  Etihad Airways operates 113 aircraft - 39 Boeing 787, 19 Boeing 777, 30 Airbus A320, and 5 Boeing 777 freighters.  Air Arabia operates 53 aircraft and flydubai operates 64 aircraft. Emirates and Etihad have been in discussions with Boeing and Airbus about delaying delivery of new aircraft and modifying orders to better align their fleet mix with anticipated demand.

Outlook

The COVID-19 pandemic continues to challenge airlines and the travel industry. As the COVID-19 situation normalizes and travel restrictions are reduced, UAE airlines seek to lead in the region while redefining strategies and increasing the focus on bringing more visitors to the UAE.

The UAE has delayed investments in increasing capacity and infrastructure development in response to the decline in demand for air travel.

Local Manufacturing

The UAE aims to establish itself as a hub for aerospace manufacturing and maintenance, repair, and overhaul.

In Abu Dhabi, the two largest players in the aviation and defense sectors are the EDGE Group and Mubadala Investment Company.  Over the past few years, these groups have formed partnerships with international companies such as Boeing, Airbus, Lockheed Martin, BAE Systems, Northrop Grumman, Rolls-Royce, the National Aeronautics and Space Administration (NASA), and Piaggio Aerospace, among others.

Mubadala Aerospace, owned by Mubadala Investment Company, oversees the development of maintenance facilities for civilian and commercial aircraft, flight training, parts manufacturing, and research and development work. Mubadala and Boeing have signed four agreements in recent years for the supply of advanced composites.

Strata Manufacturing PJSC (Strata), located in Nibras Al Ain Aerospace Park, is owned by Mubadala Investment Company. Strata was formed to forge partnerships with aircraft OEMs and incorporate leading-edge technology and best practice manufacturing. It has formed partnerships with major aircraft manufacturers such as EADS/Airbus (Tier 1 supplier), Finmeccanica/AleniaAeronautica, SABCA, and FACC. Strata is now a Tier 1 supplier to Boeing on major components used in empennage ribs for the Boeing 777, vertical fin ribs for the Boeing 787 Dreamliner, and composite empennage ribs for Boeing’s 777X aircraft.

Nibras Al Ain Aerospace Park, created jointly by Mubadala Aerospace and Abu Dhabi Airport Company (ADAC), is a mix of public and private investment projects created as a dedicated aerospace and aviation cluster.  This aerospace park spans 25 square kilometers and consists of projects, businesses, offices, and mixed-use residential zones, the majority of which are allocated specifically to the aerospace industry.

Sanad Aerotech and Turbine Services & Solution Aerospace, a wholly owned subsidiaries of Mubadala Investment Company, provides engine maintenance, repair, and overhaul services for aircraft such as the Boeing 747 and 787, Airbus A300, A320, A330, and other aircraft through technical support and partnership with OEMs including GE, Rolls Royce, Siemens, and IAE.

Global Aerospace Logistics LLC (GAL) is a subsidiary of the EDGE Group in Abu Dhabi.  The company offers a range of aviation maintenance services for rotary-wing aircraft for integrated lifecycle solutions. Services include routine inspections, repairs, and aircraft system overhauling.

GAL Air Navigation Services (GAL ANS) is certified by the General Civil Aviation Authority (GCAA), the UAE’s national regulatory authority, as the only private Air Navigation Service provider in the country. The company has an ICAO and GCAA certified training facility where it provides extensive air traffic management training to local and international customers. 

In Dubai, the Emirates Engine Maintenance Center (EEMC) is the leading service provider for aircraft engine maintenance, repair, and overhaul. The company has been working closely with Engine Alliance (EA), GE Aviation, and Rolls-Royce to develop technology for engine maintenance.

Dubai National Air Travel Agency (dnata), the ground handling and cargo services arm of the Emirates Group, has partnered with Global Jet Technic to provide line maintenance services at Dubai International (DXB) and Dubai World Central (DWC) airports.

GE Aviation has operated its support center with Emirates Engineering since 2013. The company recently opened its own support center in Dubai South to provide maintenance and repair solutions for all GE and CFM engines on the Emirates fleet and other UAE carriers such as flydubai, Etihad Airways, and Air Arabia.

Emirates Engine Maintenance Centre (EEMC) partnered with Engine Alliance (EA), a GE/P&W group, for repair and service of 90 GP7200 Airbus A380 engines on aircraft operated by Emirates. Rolls-Royce provided Trent 900 engines to Emirates Engineering to help with hands-on training before installation, including fan blade installation and component removal, etc.

Other local companies include:

  • Dubai Aerospace Enterprise
  • Emirates Engineering
  • ExecuJet

Major Airports in the UAE:

  • Abu Dhabi International Airport
  • Dubai Airports
  • Sharjah International Airport

Opportunities

Leading Sub-Sectors

Ground services – ground handling, catering, and fixed based operations (FBO): Local airport authorities have partnered with companies to bring in the latest technological innovations for passenger attraction and satisfaction including duty free services, hospitality, ground handling, catering, and Fixed Based Operations (FBO). New catering and FBO facilities will need to be developed to further expand ground handling and catering.

Maintenance, repair, and overhaul (MRO): With 46 GCAA-registered MRO companies in the UAE, the country possesses excellent capability in aircraft MRO despite the challenging sandy, hot, and dry conditions. Eleven companies are working in Dubai in aircraft maintenance and repair and two in simulation manufacturing.

Infrastructure development and aircraft hangar services: UAE airports are planning investments in infrastructure to accommodate increased fleets and airport expansion to grow capacity, and there is expected to be increased demand for airport hangar services as well as airport infrastructure development services.

Training and development: The Middle East region is short of skilled manpower. To keep up with the growing need across the aviation system value chain for pilots, crew, technical, mechanical, and operational manpower, there is a need for both academic and practical training centers and flight simulators. Based on current orders, it is estimated that the UAE alone would require around 22,000 pilots and crewmembers by 2033. 

3-D printing and additive manufacturing: The UAE 3D printing market size has grown over the last few years and this is an area of opportunity given the UAE’s commitment to expanding local manufacturing.

Drones and unmanned aerial vehicles (UAVs): Dubai’s introduction of the ‘Sky Dome’ initiative in 2020 aims to develop an integrated system for drone transport services, airfreight, and logistics services by positioning Dubai as a center for the manufacturing of drones and smart transportation.

Trade Shows and Exhibitions

Dubai Airshow

Venue: Al Maktoum International Airport DWC, Dubai Airshow Site

 

Global Aerospace Summit

Venue: Abu Dhabi, UAE

 

Airport Show Middle East

Venue: DICEC Dubai, UAE

 

MRO Middle East

Venue: Dubai, UAE

 

Aircraft Interiors Middle East

Venue: Dubai World Trade Centre, Dubai, UAE

 

Abu Dhabi Air Expo

Venue: Al Bateen Executive Airport, Abu Dhabi, UAE

 

Resources