Our air show
Our air show
It has long been a hallmark of aerospace that politics
influences the industry as much as economics does. But the nine-
day Indonesia Air Show which opened at Soekarno-Hatta airport
last weekend reflects the increasing international recognition of
Indonesia's growing role in the aerospace industry and Asia's
greatly promising market for new commercial and military
aircraft.
Politics alone would not have been enough to attract so many
major aerospace companies to take part in the air show. The
organization of an international air show, besides requiring
high-quality technical preparation and complex logistical
arrangements, is much more expensive than the usual trade
exhibitions. The exercise also exacts high costs on the
exhibitors. No wonder not many countries, even industrialized
ones, stage international aerospace exhibitions.
The Indonesia Air Show's organizing committee should be
commended for its capability to attract nearly all the major
manufacturers of commercial and military aircraft. The
achievement is even more significant because Singapore and
Malaysia regularly stage international aerospace shows which by
and large feature the same exhibitors in the current air show.
There are, we reckon, two primary factors which prompted the
257 companies to participate in the show. The professional
organization of the show and price competitiveness is surely one
reason. The promising market in the Asia-Pacific region is the
other compelling factor because the exhibitors come here not only
to promote sales in the Indonesian market but also in the Asian
region.
The ultimate success of the show will undoubtedly be measured
by the sum of business deals concluded or other forms of
agreements or market recognition which eventually lead to firm
contracts. It is understandable, therefore, that the first five
days of the show have been restricted to business and
professional visitors.
It is still too soon to assess the commercial performance of
the show. Indonesia's state-owned PT Industri Pesawat Terbang
Nusantara aerospace company did sign a number of sales contracts
for its N-250 turboprop aircraft which is slated to enter the
market in 1998, and the N-2130 jetliner which is scheduled to be
rolled out in 2004.
We do not mean to belittle the significance of these deals but
these contracts cannot be attributed to the show. Moreover, the
signing of the contracts seemed to have been timed to coincide
with the show. We get the impression that the deals with state
and private companies are 50 percent politics and 50 percent
economics. What will count greatly and determine the fate of the
next show will be the business deals or points of sales leads
gained by foreign exhibitors.
We are therefore surprised by the government's bold decision
to step up the frequency of the international air show -- from
once a decade to one every two years -- and to expand the event
into Asia-Pacific Hi-Tech and Aerospace Show. True, as President
Soeharto noted in his opening address at the air show, the
progress in aerospace technology has been quite rapid.
Nonetheless, holding such a hi-tech exhibition every other year
risks degrading the quality of the show in view of the
increasingly keen competition, which is a result of the
proliferation of similar shows in other countries.
Despite the rapid progress in aerospace technology, the life
cycle of aerospace products, being highly capital intensive and
requiring high economies of scale, is much longer than most other
manufactured goods. Attracting high-quality exhibitors with new
hi-tech products to an international show at Soekarno-Hatta
airport area every two years would be a formidable task.