Address by Mr S Iswaran, Minister for Transport, at the Launch of SIA Engineering Company (SIAEC)’s Continuous Improvement Phase, at Changi Airport Terminal 1

Chairman, SIAEC, Mr Tang Kin Fei,

CEO, SIAEC, Mr Ng Chin Hwee,

Distinguished Guests, Union Leaders, Members of the Aviation Community,

1.     It is my pleasure to join you today to celebrate SIAEC’s successful completion of Phase 2 of its Transformation Programme, and the transition to the next chapter of your Continuous Improvement Journey.

SIAEC’s Transformation

2.     SIAEC first embarked on its Transformation journey seven years ago, in 2016.

3.     It was a different world then. But many of the challenges that SIAEC faced then, remain today: these include global economic uncertainty, geopolitical headwinds, and rising costs. The MRO industry also faced intense pressure – from a highly competitive airline sector seeking to contain costs, and from OEMs trying to capture a larger share of profits.

4.     It was in this environment that SIAEC took the decisive step to level up its technology and its workforce with a $50 million investment over five years, supported by the Economic Development Board (EDB). That was Phase 1 of the transformation initiative. It was a far-sighted move that ensured that the company was better prepared to deal with the COVID-19 pandemic, which posed an existential threat to the aviation and aerospace industries.

5.     In 2021, SIAEC persevered in this journey by embarking on Phase 2 of your transformation, doubling down on digitalisation and automation to strengthen your competitiveness and improve your value proposition for both customers and staff.

6.     Today, we can say with confidence that the darkest days of the pandemic are behind us; and brighter prospects lie ahead. Weekly air passenger traffic at Changi has recovered to about 90% of pre-COVID levels. This is a significant milestone, and it comes about four months after we had crossed 80%. It gives us further confidence that passenger traffic will recover to pre-COVID levels by 2024. Looking further ahead, the Asia-Pacific region is expected to become the world’s largest aviation market over the next two decades.¹  In addition, Singapore continues to be one of Asia’s leading aerospace MRO hubs, making up 10% of global MRO output.² We are also a key manufacturing node for high-value critical parts such as engine components and avionics.

7.     Hence, it is timely that SIAEC is now making the transition to the final phase of transformation, which is continuous improvement. As competition intensifies, many regional countries are investing significantly in their airports, home carriers, and MRO sectors. Meanwhile, in Singapore, our land and manpower constraints will become more binding over time.

8.     It is therefore critical that our aviation community, of which SIAEC is a key member, stays resolute in its commitment to the transformation effort. I would like to highlight two key aspects of this transformation: technology and talent.

Technology

9.     First, I am encouraged that SIAEC is actively harnessing technology and digitalisation, which are key to overcoming our constraints, improving productivity, and enhancing our competitiveness.

10.    One example is SIAEC’s use of autonomous robots to pre-inspect and photograph aircraft engines before technicians maintain and repair the engines. These images are further analysed by an AI Application and serve as a second pair of eyes for inspection, saving technicians time and improving quality.

11.    Another example is SIAEC’s Collision Avoidance System pilot, which uses Light Detection and Ranging (or LIDAR lie - dar)³ sensors on Airtugs⁴ to alert drivers when the aircraft they are towing gets too close to an obstacle. This could lower the risk of collisions, and even reduces the manpower required for towing and pushback operations.

Talent

12.    Secondly, to effectively use such technology, we must have the right talent. I am therefore happy that SIAEC, in partnership with EDB, NTUC, and SkillsFuture Singapore⁵, made the most of the pandemic lull to help workers upskill.

13.    Chin Hwee earlier mentioned the implementation of a dual trade conversion program, where SIAEC technicians are trained to handle both mechanical and avionics-related work. I commend the SIAEC workers for taking on this challenge.

14.    I am also heartened to hear that SIAEC has encouraged and celebrated ground-up initiatives from staff.

15.    One example was how Mr Goh Bok Hua, Lead Technician at the Component Services Division, came up with a support frame that makes it easier to lace up slide rafts. It used to take six men up to 20 minutes to lace up one raft; now, just four men can do it in the same amount of time.

16.    Another innovative idea was from Mr Hassanjaya Nizar, an Engineering Supervisor in the Line Maintenance Division, who developed a hydraulic brake-change system using a modified table and trolley in 2020. SIAEC later expanded on Hassan’s solution and, today, it is expected to take just three men five minutes to change the aircraft brakes, down from four men in seven minutes just three years ago. Well done to Bok Hua, Hassan and your teams!

17.    More broadly, I am encouraged by SIAEC’s efforts to actively invest in your workforce. This includes initiatives such as the first Work-Study Diploma in Aircraft Maintenance Engineering launched in 2020 in partnership with ITE, which has since benefited more than 20 workers, and SIAEC’s MOU with seven IHLs on curriculum development, industry attachments, and research projects.

Word of thanks

18.    At this juncture, I would like to acknowledge, recognise and especially thank Chin Hwee, who will be retiring as CEO of SIAEC on 1 October this year. Chin Hwee successfully led SIAEC on its transformation journey throughout the COVID-19 pandemic. He presided over a period marked by unprecedented challenges and had to make tough calls. Under his leadership, SIAEC eschewed retrenchment and cost-cutting, and chose instead to stay the course on innovation, retain staff, and double down on investments in your people. I would like to thank Chin Hwee for his invaluable service and wish him continued success and all the best.

19.    Chin Hwee’s successor, Yau Seng, is no stranger to SIAEC, and we look forward to your contributions to our OneAviation community.

Conclusion

20.    In conclusion, I am confident that as long as SIAEC stays the course on continuous improvement, you will be well-poised to seize the new opportunities that lie ahead – which we know there are many – and maintain your position as a local champion in Singapore’s MRO sector. The Government will continue to be a steadfast supporter of SIAEC’s transformation journey.

21.    I wish you continued success as you seize the opportunities that lie ahead. Thank you.

^{1 Airports Council International (ACI) projects that by 2041, the Asia-Pacific will account for 45.2% of aviation market share. (Source: ACI World Traffic Forecasts, 2022-2041, Executive Summary)}

^{2 Source: EDB Singapore (https://www.edb.gov.sg/en/our-industries/aerospace.html)}

^{3 Light Detection and Ranging (LIDAR) is a method for determining ranges by targeting an object or surface with a laser and measuring the time for the reflected light to return to the receiver.}

^{4 Aircraft Tugs (Airtugs) are used to transport an aircraft around (e.g., to prepare an aircraft for take-off).}

^{5 SIAEC has partnered these organisations on the following initiatives – EDB: Lean Courses, CAAS, NTUC: Singapore One Aviation Reskilling Grant (SOAR), NTUC e2i: Aircraft Type Courses, SSG: Enhanced Training Support Packag}e.