Global contracts helping push Strata into aviation spotlight

Al Ain-based aeronautical manufacturer expects to cross the Dh400m revenue mark for second year

18:20 October 15, 2016

Abu Dhabi: Strata Manufacturing is expected to cross the Dh400 million mark in revenue for the second time in as many years, on the back of new orders from Boeing and Airbus, Badr Al Olama, chief executive officer of the Al Ain-based aeronautical manufacturer, told Gulf News in an interview.

The company was awarded two Airbus contracts valued at more than $1 billion (Dh3.67 billion) and a multi-year contract with Boeing to manufacture vertical fins for the 787 at Farnborough air show in July.

“Last year we had a revenue of Dh400 million and this year it would definitely be higher. We are aiming to reach Dh1 billion revenue by 2020. There is going to be significant growth in the coming years with the number of work packages we’ve been getting from both Boeing and Airbus,” he said.

By contrast, revenue in 2011 was Dh61 million.

“The new contracts will bring in new capabilities to the company apart from increasing the revenue. The speed of work will go up exponentially — from taking 2-3 days for manufacturing a specific product to completing a significant large structure product every business day. This is something extremely challenging and rewarding at the same time for Strata.”

During the year, Strata delivered over 433 shipsets, consisting of more than 7,511 parts — representing a 29 per cent growth in the total number of parts manufactured in 2014.

With the government gearing up to host the Global Manufacturing and Industrialisation Summit in Abu Dhabi next year, the presence of Strata with big orders from Boeing and Airbus is expected to boost the manufacturing sector that is contributing 14 per cent of the UAE’s GDP.

Al Olama said the company has aspired from day one to become one of the top three global manufacturers for Boeing and Airbus. The new contracts signed at Farnborough will get them one step closer to that vision.

“With respect to people, there will be a lot of development and up-skilling and training so that these individuals that we have in this facility today are going to be of at a level that you would expect to see in places like Toulouse or Seattle where Airbus or Boeing are located.”

Al Olama said Strata values the relationship with Boeing and Airbus, and the company is delivering parts on time while meeting quality standards.

The company is now considering opening new manufacturing new facilities in North Africa and the US as their two main customers are located nearby. No timeline has been given for the new factories.

Al Olama says Strata also has plans to tie up with other aircraft manufacturers across the globe to serve the growing demands of the aviation industry.

“Strata needs to build its value proposition further to become the supplier of choice for the aircraft manufacturers, therefore when the right time comes for Strata to expand geographically, we will be looking for future customers that are keen to work with us.”

The company is looking at China, Canada, Brazil and Russia in particular.

“China has its own platform with respect to a commercial aircraft, Brazil has Embraer, Canada has an important player with Bombardier and Russia has a joint venture with Italy on the Superjet. There are multiple platforms that are interesting and are promising for the global [aviation] industry.”

The firm expects huge demand for low-cost carriers in the coming years, with the growth of the middle class population across the globe, especially in India and China.

“There is a huge growth of low-cost carriers and the backlog is still there. As Airbus and Boeing fulfil the backlog there are more orders that are coming up. As long as people are travelling we are going to continue building parts.”

Strata Manufacturing was established in 2010 and is wholly owned by Mubadala Development Company. The Al Ain-based company recently embarked on an expansion project to increase their shop floor area to 31,500 square metres, adding 10,000 square metre of usable production space.