Airbus Supplier in Indonesia Targets Composite Parts Orders

(Bloomberg) -- Dirgantara Indonesia, a supplier of aluminum wing components for Airbus SE’s A320 and A380 model jets, is developing the production capability to supply non-metal aircraft parts as well.

The company is “exploring opportunities” to produce so-called composite parts -- typically made from fiberglass or carbon fiber -- for both Airbus and Boeing Co. within the next two years, President Director Elfien Goentoro said in an interview in Jakarta Monday. The state-owned company, which is also an aircraft manufacturer, intends to triple its plane production to 56-a-year by 2024, he said.

The expanded production plans would support the Indonesian government’s efforts to reduce the nation’s dependence on commodities and narrow the current account deficit. Dirgantara, based in West Java, expects its latest 19-seat propeller plane, the N219, to obtain certification from Indonesian regulators this year, Goentoro said.

“We want to expand our composite-parts production facilities so hopefully by 2021, we can start taking orders for these aircraft parts,” Goentoro said. “We also plan to invest $119 million to build a facility dedicated to producing the N219.”

Island Hoppers

The aircraft would be for use in industries including tourism to provide access to remote areas, such as some of the 17,000 islands that make up Indonesia, the world’s largest archipelago. Dirgantara plans to produce 36 of these aircraft annually by 2024 with a target to exporting half of them, in addition to making 20 other propeller planes a year, Goentoro said.

The company is targeting orders for the N219 in the Philippines, Thailand, Malaysia, East Timor, Nepal, Senegal and South Korea this year, Goentoro said. “Our company’s intention is to boost our exports significantly so we can have a better balance between our domestic contracts and contracts denominated in foreign currencies.”

Dirgantara plans to boost its aircraft maintenance, repair and overhaul business and is certified by Airbus to service some of its military aircraft and helicopters, Goentoro said.

The company previously supplied parts for Boeing’s 737 family of aircraft under a contract that has expired, Goentoro said. Dirgantara wants to secure a new contract with the U.S. aircraft maker, he said, without specifying whether they are in discussions.

Goentoro also said he’s in talks with Indonesian finance ministry officials to allow the N219, which was developed domestically, to be sold to local customers without attracting a luxury tax from the government.

To contact the reporters on this story: Harry Suhartono in Jakarta at hsuhartono@bloomberg.net;Fathiya Dahrul in Jakarta at fdahrul@bloomberg.net

To contact the editors responsible for this story: Young-Sam Cho at ycho2@bloomberg.net, Lena Lee, Ville Heiskanen

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