Opportunities abound in aerospace and defense - study

The firm's Analysis of Private Equity and Venture Capital Investment Trends in the Aerospace & Defence Industry in Europe found that India and China are among the preferred Asian countries for investments because of lower costs compared to their Western counterparts. By 2030, Asia-Pacific is expected to account for a 33% share of passenger traffic, followed by Europe at 23% and North America at 20%.

"Due to these trends, many original equipment manufacturer (OEM) integrators such as Airbus and Boeing are shifting their production facilities to low labor cost countries in Asia-Pacific," said Frost & Sullivan Financial Analyst Bharath M. "OEMs are also actively seeking ways to reduce manufacturing costs by outsourcing more 'design-to-build' packages rather than just 'build-to-print' to Tier 1 OEMs."

The growth of the middle class population, especially in India, China and Russia, is expected to create demand for the purchase of over 3,500 planes - roughly 15% of the global demand - over the next two decades.

Last year Frost & Sullivan tipped India to spend $100 billion on defense modernization programs by 2022. This was underpinned by a defense offset policy, whereby the Indian government agrees to buy products from foreign suppliers on the condition that these companies purchase a certain amount of goods locally.

In November, Maini Global Aerospace received a $10 million investment from a foreign private equity fund. The Indian company is using the funding to build a new factory.

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• Topics
• Infrastructure
• South Asia
• Greater China
• Investments
• Defense & aerospace
• India
• China