Singapore Airlines (SIA) and Canadian flight simulator and training service provider CAE plan to open a joint venture (JV) for pilot training at the Singapore Airlines Training Center (STC) near Changi Airport, the two companies said in a memorandum of understanding (MOU) Aug. 10.

SIA intends to transfer four of its full-flight simulators for Boeing aircraft to the JV facility; CAE will add its own training equipment progressively, the company said.

The initial focus of the facility will primarily be simulator training on Boeing aircraft types, supporting SIA Group airlines (Singapore Airlines, SIA Cargo, SilkAir, and Scoot) and other operators in the region. A full range of initial type rating and recurrent training programs for Boeing 737 MAX, 747, 777 and 787 aircraft types will be offered, CAE said.

The finalization of the JV transaction is pending customary closing conditions, including regulatory approvals, CAE said.

“With the SIA Group expanding its fleet to drive additional growth, [this] joint venture will help keep pace with our own training requirements as well as those of other airlines in the region,” SIA CEO Goh Choon Phong said. “The long-term prospects for the aviation sector are positive, and we are confident that [this] new flight training joint venture with CAE will further enhance Singapore’s position as a leading aviation hub.”

CAE president and CEO Marc Parent said, “[We] welcome this opportunity to leverage the strengths of our combined organizations to support the growing pilot training needs in the Asia-Pacific region, one of the fastest growing markets in commercial aviation.”

Pilot training demand

In a pilot training demand report released at the Paris Air Show in June, CAE said the world’s airlines will need 255,000 new airline pilots over the next 10 years.

Boeing, in its latest 20-year outlook released in July, forecasts the Asia-Pacific region will require 253,000 new pilots by 2036.

SIA Group, in its quarterly financial report released July 27, said it will continue to take delivery of new aircraft to further expand its network in both full-service and low-cost market segments, in the latter case citing the recent integration of SIA’s low-cost carriers (LCCs) Scoot and Tigerair under the Scoot brand name as an opportunity for expansion in long-haul connecting traffic within Southeast Asia.

As of Aug. 3, SIA Group has 112 Boeing aircraft on order, including 49 787-10s and 20 777-9s for mainline carrier Singapore Airlines; 37 737 MAX 8s for regional subsidiary SilkAir; and four 787-9s and two 787-8s for LCC Scoot, according to Aviation Week Fleet Discovery data.

CAE sells 49% equity stake in ZFTC

CAE also announced Thursday that it is selling its 49% equity stake in China Southern’s Zhuhai Flight Training Center (ZFTC) to China Southern for $96 million. As part of the transaction, China Southern plans to outsource to CAE third-party airline training at ZFTC, while CAE will continue to partner with China Southern for training services support, ab initio pilot training and simulator equipment. CAE said the new arrangement “allows CAE greater flexibility to address the broader aviation training market in China and the ASEAN region, and the opportunity to align its capital investment with its strategic priorities.”

AirAsia discussions continue

CAE also confirmed the company is in advanced discussions with AirAsia to conclude a sale-and-purchase agreement for CAE to acquire AirAsia’s 50% share of the Asian Aviation Center of Excellence (AACE), located at Kuala Lumpur International Airport. The AACE is a JV between CAE and AirAsia launched in 2011.

“CAE’s relationship with AirAsia began in 2004 and with this agreement, it would expand with a contract for all AirAsia training requirements and that of its affiliates, in support of all the aircraft types it operates for an extended term,” CAE said. The sale-and-purchase agreement between the parties is still to be finalized.

CAE, which in addition to civil aviation training also provides training services in defense/ security and healthcare markets, released its fiscal 2018 first-quarter financial results Aug. 10, reporting C$63.8 million ($49 million) in net profit (down 7.1% year-over-year) and C$698.9 million in revenue, up 7.3% from last year.

CAE’s civil aviation training solutions segment reported C$411.8 million in revenue during the quarter, a 10.8% rise over the year-ago quarter. CAE signed C$400.4 million worth of training contracts during the quarter, including ab initio pilot training for India’s Jet Airways as well as business aviation pilot training for other clients. The company also sold eight full-flight simulators during the period.

Mark Nensel