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Welcome to Aviation Valley

11/12/2013 by Cdr. Bud Slabbaert

Aviation Valley is the region in the south-eastern part of Poland that has evolved into one of the leading locations in Central Eu­rope for conducting and developing projects associated with aviation. It is one of six Euro­pean regions highly specialized in aerospace with a high concentration of manufacturing plants, scientific research centers, as well as educational and training facilities. It was no coincidence but a strategic path to growth and innovation. California’s Silicon Valley, the most famous industry cluster in the world may have been the example for this vibrant aeronautics hub in a country that is now the sixth largest economy of the European Union. Once one of the least prosperous regions of Poland now boasts a cluster of more than 100 companies and homegrown startups that are integrated into the global aerospace supply chain. All in all, the region’s dynamic growth has resulted in more jobs and an improved standard of living for its residents.

A decade of growth

In less than a decade, the aerospace cluster has grown from a collection of 18 companies in 2003 to 102 companies now, and several new ones are in the pro­cess of applying for membership. Every new company is sure to find partners for cooperation for further developments. The aviation cluster companies cooper­ate with each other primarily on the cus­tomer – supplier basis (supply of parts, materials and raw materials). This is the most common model of cooperation between leading and small companies who are subcontractors and coopera­tors. Particularly intensive cooperation exists between the so-called spin-off companies – established under the re­structuring of large enterprises – and the core company, which usually is the main purchaser of products and services of the newly created company.

The workforce increased from 9,000 in 2013 to around 23,000 employees, includ­ing engineers, designers and technicians and other high tech professionals. The Aviation Valley Association represents more than 90 percent of Poland’s aero­space industry. The combined exports of Polish companies in the aerospace sector reached around $1.5 billion last year, and their worldwide reputation is on the rise. According to the Polish Information and Foreign Investment agency, almost every passenger aircraft in the world has at least one part made in Poland.

Competitive Edge

Polish-based aviation companies are considered to be among the best suppliers for the global aircraft industry and they enjoy a growing demand for their parts and products from all over the world. They can offer the same standard of ser­vice and products but at lower prices than Western companies. The cost-to-quality ratio is excellent. High class engineer­ing combined with competitive prices is essential, particularly in recent difficult economic times. It turned into an oppor­tunity for growth since it has put pressure on multinational corporations to reduce costs, inclining them to seek “low-cost” investment destinations. Some claim that a Polish worker is 20 percent more pro­ductive than a worker from the West, al­though he still earns three times less than his Western counterpart. Even though labor costs are low, there is no intent to growing the industry on the basis of cost alone.

Education and R&D Center

From the beginnings, it was recognized that Research and Development activities related to the industrial activities in the region needed to be furthered in order to develop new solutions, processes, and products. In Aviation Valley there is a strong commitment to invest in the edu­cation system. The region has 16 univer­sities, colleges and vocational schools. It has European highest number of students enrolled in higher education per 1,000 residents. The intend was also to increase cooperation between the industry and universities and now Poland’s aircraft-production hub has be­come a thriv­ing center of R&D, with the lo­cal, well-established universities providing much of the know-how.

The Rzeszów University of Technol­ogy with a department of mechanical engineering and aviation, coordinates the Center of Advanced Technology “AER­ONET – Aviation Valley,” which acts as an incubator for ideas, technology and specialists which companies can draw on. AERONET was founded for the purpose realizing interdisciplinary, collective and long-term research and training pro­grams, as well as effective implementation and commercialization of new technolo­gies for the aerospace industry.

This advanced technologies center spe­cialized in the fields of design and testing of aviation structures and propulsions, aviation teleinformatics and avionics sys­tems, modern materials and surface en­gineering processes, and modern produc­tion techniques in the aerospace industry

Innovation Incubator

AEROPOLIS is a technology incuba­tor in an environment with the ambiance of innovativeness. It is a place where high technologies connected with aviation, IT, and automotive industry will be concen­trated. The incubator offers facilities for conducting research and production to en­trepreneurs of startups. They will have an opportunity to hire premises suitable for both production and services on preferen­tial terms. The center can accommodate 42 entrepreneurs for who offices and confer­ence room are available. There are labora­tories for composite and polymer materials, IT systems for diagnosis purposes, com­puter-aided research and design, aviation constructions, sources of renewable energy. In addition there will be a Laboratory of Biotechnology for In vitro plants cultures, biotisation of plants and allelopathy and for molecular markers.

An incubator of a different kind is the “University of Technology for Children,” a learning laboratory created by the Avi­ation Valley Association. It encourages young people’s interest in aeronautic sci­ences whereby leading professionals of the cluster companies are teaching chil­dren in the ages for 7 to 12.

Key to Success

One of the keys to success was to partner with the best; they partnered with US aerospace giants like Sikorsky, Pratt and Whitney and United Tech­nology Corporation. Subsequently, US partners made a long-term investment in the valley’s infrastructure, education and knowledge transfer. Most of the Polish aerospace companies are now foreign-owned and fully integrated into a global supply chain. As a direct result of the investment by multinationals and the dynamic development of production in the country, smaller, local companies are winning contracts to supply parts. They form the core of the Aviation Val­ley cluster and are an important strategic element of the development of the avia­tion sector in Poland.

Investments by the Millions

PZL Mielec, the biggest Polish manu­facturer of aircraft, was acquired by Ameri­can Sikorsky Aircraft Corporation in 2007. Since Sikorsky Aircraft invested more than $ 125 million in the company, sales have tri­pled and the employment increased by 40 percent – that’s 700 new jobs. The company modernized its production halls and hang­ars and introduced modern quality man­agement systems. In 2011 it launched the mass production of the S-70i Black Hawk. The production of this utility helicopter has resulted in orders for 50 local suppliers. The company also produces components for the Black Hawk which are exported to the United States, including cock­pits, tail cones and py­lons.

In 2008 Goodrich Corporation, now UTC Aerospace, started a new plant for produc­tion and assembling landing-gear parts, in­vesting $ 50 million in the operation and em­ploying 250 people.

In 2010 Anglo-Ital­ian Agusta-Westland acquired a majority stake in PZL-Świdnik, one of the biggest heli­copter manufacturers in Poland, and invested around € 72 million in the factory.

Hispano-Suiza Polska, part of the French SAFRAN Group, has been operat­ing in Poland since 2001 and produces ele­ments for plane engines, among others, for Airbus A-380 and Boeing 787. In 2008 the company invested € 20 million in two new production facilities to host a department of structural components and to focus on engine nacelle production. The company employs about 450 persons.

The German manufacturer MTU Aero Engines announced that it is expanding its facility in size in the Aviation Valley by 50%, an investment of € 40 million. The company also intends to boost its R&D at the Polish plant. At the moment has a workforce about 500 employees when the new facility run at full capacity that num­ber will increase to 750.

Most recently, the European aviation and defense industry holding EADS has declared its intention to increase its pres­ence in Poland and thinks of an invest­ment of about € 7-8 billion. After France, Germany and Spain, Poland would be­come EADS fourth base. Currently the company employs about 800 people in Poland.

Vision for Europe’s Aviation

Marek Darecki who was the brainchild and co-founder of the Aviation Valley As­sociation and currently its CEO is travel­ling around the world to further promote the region and the industry. In 2010 he was appointed Board Member by the European Commission of the so-called European Commission High Level Group on Aviation and Aeronautics Research whose mission is to come up with a development vision of the European aviation industry up to 2050. Marek Darecki foresees Polish aviation as a significant contributor to Europe’s vision for aviation in the years to come and in Aviation Valley competencies are developed that will allow shaping that Vision.

Poland’s National Center for Research and Development of the Ministry of Science and Higher Education has an­nounced a € 72 million investment in the development of innovative technologies within the aviation sector over 2013-17. The private sector is expected to provide another € 48 million for the project, fund­ing that will push R&D forward in an in­dustry for which innovation is essential.

The competitiveness of Poland’s avia­tion industry is strengthening and giving the skills and innovativeness of its profes­sionals a greater chance to shine.