Backgrounder Boeing in the United Arab Emirates The Boeing Company shares a long-standing relationship with the United Arab Emirates (UAE), which is home to Emirates Airline, Etihad Airways and flydubai. From air transport and aviation support services to defense and satellite systems, Boeing has worked closely with UAE civil and defense authorities to achieve the country s objectives and ambitions. Boeing values its relationships and partnerships in the region and is committed to building on those relationships for mutual benefit into the future. The UAE has emerged as a global air transport hub, thanks to its unique geographical position and a strategically planned approach to growing its aviation sector. Over the past few years, its airlines have grown in both influence and reach and currently operate scheduled passenger and cargo flights to more than 140 destinations on six continents. In 1999, Boeing Defense, Space & Security, which was then known as Integrated Defense Systems, established an office in Abu Dhabi. Since then, Boeing has strengthened its presence in the country. In 2005, Boeing established its headquarters for Boeing Middle East in Dubai. Bernard Dunn was appointed president of Boeing Middle East, North Africa and Turkey in May 2015. He is based in Dubai. Boeing Commercial Airplanes Since 1992, the UAE has ordered more than 700 Boeing aircraft, including both direct purchases and leases. Boeing airline customers in the country include Emirates Airline, Etihad Airways and flydubai as well as aircraft lessor Dubai Aerospace Enterprise. Dubai-based Emirates Airline is currently the world s largest operator of the 777 with more than 165 of the award-winning twin-jets in its fleet. The airline is also a launch customer for the 777X, which it ordered at the Dubai Airshow in 2013, breaking a record for the single largest airplane order ever in the world. The order comprised 115 777-9s and 35 777-8s, plus purchase rights for an additional 50 airplanes. Emirates will be the first airline to receive the 777X. At the Dubai Airshow 2017, Emirates announced a commitment for 40 787-10s, which, when finalized, will mark the entry of medium-sized airplanes in its fleet. Etihad Airways is Boeing s largest 787 customer in the Middle East (and one of the biggest 787 airline customers globally) with a total order of 71 Dreamliners, including 30 787-10s that the airline ordered in 2013. The airline was also a launch customer for the 777X with an order of 25. 1
One of the UAE s fast-growing carriers, flydubai became the region s largest customer for the Boeing Next-Generation 737-800 when it placed an order for 50 airplanes in 2008. Subsequently, in 2013, flydubai ordered 75 737 MAXs and continued as an all- Boeing operator taking delivery of its first MAX in July 2017. At the 2017 Dubai Airshow, flydubai struck another landmark agreement with Boeing for up to 225 737 MAX airplanes, representing the largest-ever single-aisle jet order from a Middle East carrier by number of airplanes and total value. Boeing provides technical support for its customers in the UAE through the Dubai-based Boeing Service Center. The center is one of eight spares distribution facilities Boeing has worldwide and houses approximately $25 million worth of parts and an inventory of more than 26,000 items that are shipped around the region to service airline customers. In addition, a regional spares manager and six field service offices in the region provide aftersales support, and 15 Boeing field service representatives provide on-site support to Commercial Airplanes customers. Boeing has forecast that the Middle East will require 3,350 new airplanes, worth an estimated $730 billion, over a 20-year period from 2016 to 2035. Forty-five percent of that demand will be for single-aisle airplanes, 53 percent will be for small, medium and large widebody airplanes, and the remaining 2 percent will be for regional jets. Defense, Space & Security The Defense, Space & Security business unit of Boeing provides military aircraft, network and space systems, and services and support to Boeing and non-boeing platforms to customers around the globe. The Defense, Space & Security presence in the UAE goes back to 1999, when it established an office in Abu Dhabi. Today, Defense, Space & Security offers its customers and partners a portfolio of products, systems, services and solutions, including products from Boeing Military Aircraft; Space and Launch; Strike, Surveillance and Mobility; and Missile and Weapon Systems, all fully supported and maintained by Boeing Global Services.. Defense, Space & Security products provided to the UAE include the AH-64 Apache and CH-47 Chinook helicopters, plus unmanned aerial vehicle (UAV) systems. In addition, the UAE s Thuraya Satellite Telecommunications operates three Boeing 702 satellites. UAE also operates eight C-17 Globemaster III heavy-lift aircraft. In February 2017, Boeing received a two-year contract from the UAE to provide logistics support and C-17 training simulator maintenance in support of the country's training program for the C-17 Globemaster III aircraft. Defense, Space & Security continues to partner and pursue opportunities with a number of Middle East organizations to help craft the future of aerospace in the region. Boeing remains committed to strengthening these industrial partnerships while exploring new opportunities. 2
Boeing Global Services Becoming operational in July 2017, Global Services was formed by integrating the services capabilities of Defense, Space & Security and Commercial Airplanes, plus subsidiary companies. This integrated business is headquartered in the Dallas area. Global Services specialized capabilities span across: Digital aviation and analytics. Engineering, modifications and maintenance. Supply chain. Training and professional services. Boeing subsidiary Aviall s Middle East facility, located in Dubai, provides sales and customer service support to the commercial airline industry, military customers and business aviation in the Middle East and Northern Africa. Jeppesen, a Boeing company, is the world s leading provider of information management, operational efficiency, optimization and disruption management tools for pilots and aircraft operators. Jeppesen s Middle East hub in Dubai, established in 2007, is staffed by a team of professionals who bring many years of experience in the Middle East to supporting customers in fast-growing market. CDG, a Boeing company, provides a comprehensive engineering and technical data solutions portfolio. With multiple support locations across the USA, UK and India, the company holds aircraft interiors Design Organisation Approval (DOA) certifications from the GCAA regulatory authority in the United Arab Emirates and the EASA European regulatory authority. Boeing Capital Corporation As a wholly owned subsidiary, Boeing Capital Corporation creates financing solutions for customers that purchase the company s commercial airplane and defense products. As the company s investment bank, it works closely with third-party financing sources that provide nearly all of the financing support required by Boeing customers. Boeing Capital also manages the company s $3.5 billion portfolio of commercial airplanes. Boeing has distinguished itself in the region among aircraft manufacturers by working closely with Middle East financiers. As a result, the region s support for Boeing aircraft deliveries has essentially doubled in the last two years. Boeing regularly organizes events in the Middle East that are designed to engage the region s finance community. Since 2006, it has hosted annual airline planning seminars for financiers in the UAE and other Middle East countries, and its Middle East financiers and investors conference has become an annual event. 3
In 2012, Boeing entered into the region s first working-together agreement for aircraft financing and leasing cooperation with the National Bank of Abu Dhabi (NBAD). Through this association, the region s highly successful first Chief Risk Officer Summit for airlines and investors was held that year. In 2015, Boeing Capital appointed Ahsen Rajput to the position of deputy managing director for the Middle East, Africa and South Asia region. Rajput is based in Abu Dhabi and is Boeing Capital s first local hire in the region. Industrial and Academic Partnerships As a company with a global footprint, Boeing sees growing aspirations for increased skills and technology development in countries around the world, and the UAE is a prime example. The company s industrial collaboration with the Mubadala Development Company, Tawazun Precision Industries and Emirates Defense Industries Company (EDIC) reflect Boeing support of UAE s ambitions to diversify its economy and increase job opportunities for citizens. The partnerships also underline Boeing s desire not only to do more business in the Middle East region but also to bring enhanced capabilities into the company. Boeing views Mubadala, Tawazun and EDIC as long-term strategic partners and is committed to supporting their ambitions to develop advanced aerospace and defense capabilities. The intent of Boeing s strategic framework agreements with Mubadala, developed since 2009, is to develop mutually beneficial initiatives in areas where there is strategic alignment between the two companies. These focus areas include composite manufacturing; engineering, research and development; commercial maintenance, repair and overhaul; military maintenance and sustainment; pilot training; and people development. In April 2012, Boeing and Mubadala announced a 10-year direct contract for Strata Manufacturing Mubadala s advanced composite aerostructures facility in Al Ain to produce commercial composite aerostructures for the 777 and the 787 Dreamliner. Strata currently manufactures ribs for the empennage of the 777 and vertical fin ribs for the 787 Dreamliner. In 2014, Strata s first shipset of empennage ribs was installed in a 777-300ER (Extended Range) that was delivered to Emirates Airline. In 2015, Strata s first shipset of 787 vertical fin ribs was installed in a 787-9 Dreamliner delivered to Etihad Airways. At the 2016 Farnborough Air Show, the companies announced that Strata would expand its work statement for Boeing as a supplier of the 787 vertical fin, a major composite assembly for Boeing s most advanced airplane program. Additionally, Boeing agreed to source pre-impregnated composite materials for the new 777X from a new, UAE-based joint venture created by Mubadala and Solvay, making Boeing their first customer. Also, Boeing is supporting UAE s research and development objectives to ensure sustainable growth of its booming aerospace industry. In 2016, Boeing and Mubadala announced an agreement for Boeing to support bilateral research projects conducted at Khalifa University and Masdar Institute of Science and Technology. 4
At the 2013 Dubai Airshow, Boeing signed a partnership with Tawazun Precision Industries (TPI), an EDIC subsidiary, to establish a new aerospace surface treatment facility in Abu Dhabi. The certified, state-of-the-art facility enables TPI to produce complex metallic assemblies for Boeing, its suppliers and other aerospace manufacturers worldwide. At the 2015 Dubai Airshow, TPI and Boeing announced the first award of complex metallic machined parts for Boeing tactical aircraft to be built at TPI s new facility. At the 2017 Dubai Airshow, Tawazun Economic Council and Boeing signed an agreement to expand UAE s role by enabling advanced materials manufacturing. Boeing has also worked with Masdar Institute of Science and Technology, Etihad Airways and Honeywell s UOP to establish the Sustainable Bioenergy Research Consortium (SBRC), a partnership to develop sustainable available biofuel in the UAE as part of Boeing s global effort to reduce aviation s environmental impact. Boeing and its research partners, which include Takreer oil refinery, made breakthroughs in sustainable aviation biofuel development, finding that desert plants fed by seawater produce biofuel more efficiently than other well-known feedstocks. In March 2017, SBRC began testing the findings at the world s first bioenergy research facility, which is located on a five-acre site at Masdar City, a low-carbon, low-waste sustainable urban development in Abu Dhabi. An active supporter of academic initiatives in the country, Boeing has partnered with Khalifa University, UAE University and the Higher Colleges of Technology (HCT) on various educational programs. Boeing supports their engineering programs through capstone projects, scholarships and research as well as guest lectures whenever possible. Also, high-potential professionals from UAE, selected by Boeing customers and partners, have attended leadership programs at the Boeing Leadership Center in St. Louis, Missouri. This is the seventh year Boeing has provided mentoring to students at two campuses of the Higher Colleges of Technology: the Abu Dhabi and Khalifa City women s campuses. The program is a Boeing-developed, UAE-based mentorship program focused on leadership skills and exposure to the private sector. This successful and impactful program will continue to grow to include more students. Boeing will continue establishing strong and enduring partnerships in the Middle East through human capital development programs as well as technology and knowledge transfer. The company is continuously exploring opportunities to reinforce its partnerships to bring mutual and long-term benefits, while enhancing the region s aviation sector. Global Corporate Citizenship Boeing aligns its Global Corporate Citizenship strategy with local government aspirations and market needs. Therefore, Boeing uses charitable contributions, 5
sponsorship funds and in-kind donations to address the people development, unemployment, and science, technology, engineering and math (STEM) education needs in the region. Over the years, Boeing has supported numerous organizations to address UAE s community needs. Some of the organizations include: Indemaj, creating SMART rooms in schools in rural areas; Action Care, to train caregivers on how to maximize children s development early; INJAZ UAE on business and entrepreneurship skills; Planet Finance, on micro-financing entrepreneurs through the Khalifa Fund; and Emirates Foundation to help women become teacher s assistants. Education and employability are Boeing Middle East s focus, and Boeing works to provide high-quality programs and opportunities for educational professionals and Arab youth. In December 2012, we launched the International Business Intern program. The annual program allows students to spend six months working in the United States at the Commercial Airplanes facility in Renton, Wash. In 2015, Boeing, Mubadala and ADEC launched an 18-week co-op program in which up to 10 engineering students can work as interns in the U.S. to better understand the world of aerospace engineering. Currently, Boeing is working with Mubadala, Abu Dhabi Education Council and Iridescent, a U.S.-based nonprofit organization, to teach STEM learning through handson engineering design challenges. Boeing is also working with Action Care on a program designed to build human and social capital by helping youth gain skills that can be applied for success on a personal, professional and community level. The program has undergone extensive development within the UAE to more effectively address learning gaps and the specific challenges experienced by migrant students enrolled in charity schools in Dubai, Sharjah and Ajman. Contact: Dana Salloum Boeing International Corporation +971-4-2134747 dana.i.salloum@boeing.com Last revised April 2018. # # # 6