The Aerospace, Defence and High Technology Industry
The Aerospace, Defence and High Technology (ADHT) Industry in the Netherlands is relatively small. Approximately 350 small and medium sized enterprises and several large companies consist the Dutch ADHT. Roughly 24,800 people were employed in 2016 by the Dutch ADHT of which 32% (approximately 8.000 highly skilled and educated people) worked for R&D programmes.
Most of the ADHT companies have organised themselves on a central level through large umbrella organisations. Perhaps the most influential organisation in the country is the Netherlands Industries for Defence and Security (NIDV), a non-profit organisation founded in 1984 by the Dutch Ministry of Defence, the Ministry of Economics and the Ministry of Foreign Affairs. The NIDV represents around 200 Dutch ADHT companies and its task is to defend the interests of these companies towards the Dutch government and influence its policy. In addition to that the NIDV promotes the position of the Dutch SDI in obtaining national and international orders.
Another important organisation of the Dutch ADHT is the Netherlands Aerospace Group (NAG). The NAG has more than 100 member companies that represent 95% of the Dutch aviation industry’s revenue. NAG represents the Dutch aerospace industries in the Aerospace and Defence Industries Association of Europe (ASD) and acts as the sector’s contact with the Dutch government. NAG focuses on airport development & infrastructure, aircraft manufacturing and aircraft maintenance, and its mission is to optimise the Dutch aviation industry’s ability to compete internationally.
The total revenue of the Dutch ADHT in 2014 was 4.54 billion Euros accounting for 0.68% of the GDP of the Netherlands for this year. Most companies of the Dutch ADHT are niche-oriented supplying sub systems and components and only the Damen Schelde Naval Shipbuilding is an original equipment manufacturer. In 2016 about 80% of the companies of the national defence and security industry are Dutch owned, while the remaining 20% consists of companies with an international mother company abroad.
The main Dutch ADHT companies are:
- GKN Fokker, mainly Aerostructures (Papendrecht and Hoogeveen), Landing Gear (Geldrop) and Wiring Harnesses (Elmo in Hoogerheide)
- Thales NL, mainly Integrated Radar/Weapon Systems (Hengelo) and Radio Communications (Huizen)
- Damen Naval, Vlissingen
- R+H Marine, Schiedam
- Van Halteren, Bunschoten and Zwolle
- Scania, Zwolle
- Daf Trucks, Eindhoven
- VDL, different locations, corporate offices in Eindhoven
- NLR, TNO and Marin (Laboratories)
- Aeronamic, Almelo and Woensdrecht Air Base (LCW)
- Airbus Defence and Space, Leiden
- Ten Cate, Nijverdal
- Bosch Rexroth, Boxtel
- Contour Advanced Systems, Varsseveld
- Rheinmetall MAN, Ede
- SMI, Dokkum
- KMWE, Eindhoven, Turkey and Malaysia
- One Logistics, Woensdrecht Air Base (LCW)
- Sundstrand Customer Support Centre, Maastricht
- Fox IT, Delft
- Standard Aero, Tilburg
The Dutch ADHT industry is focused in the fields of:
- Integrated systems design and development
- sensors C4I and automation
- advanced materials and components
- simulation trainers and synthetic environments
- electronic warfare and cyber defence
- maintenance repair and overhaul (MRO)
- computing technologies and mathematical techniques
- information and signal processing technology
- electronic, electrical and electromechanical device technology
- personnel equipment
- propulsion and powerplants
- communications and Computer Information System (CIS) technologies
- battlespace information
According to the 2016 statistics more than 68% of the total revenues of the Dutch DSI come from exports. The main export countries for the Dutch DSI are Belgium, Germany, UK, USA, Greece, Bahamas, Mexico, Oman, Colombia, S. Arabia, Peru, Canada, Turkey and Indonesia.
Two the most important features of the Dutch DSI, its R&D capabilities and industrial participation. The R&D policy in the defence and security industry sector is promoted by the government, while Small and Medium Size Enterprises (SME) are also encouraged to involve in the development, production and procurement of defence materials and services via industrial participation.
Furthermore three research organisations have been established in order to assist the Dutch DSI, the Netherlands Organisation for Applied Scientific Research (TNO), the National Aerospace Laboratory (NLR) initiated by NAG and the Maritime Research Institute of the Netherlands (MARIN).
These organisations along with Dutch Universities and technology Institutes, contribute to the development of innovative technologies for the defence and security industry. The Dutch Ministry of Defence with its “Knowledge and Innovation Policy” is responsible for steering the national defence-specific science and technology development effort.
For this purpose the Dutch Ministry of Defence has been spending over the last six years approximately 60 million Euros per annum. To be exact in 2013 the Dutch Ministry of Defence allocated 59,2 million Euros, in 2014 allocated 59,4 million Euros, in 2015 allocated 61,6 million Euros, in 2016 allocated 57,2 million Euros and in 2017 allocated 61,7 million Euros.
The Dutch model for the future development of the national Defence and Security Industry includes the partnership between the government, the knowledge institutes and the companies of the defence industry based on consultation and deliberation. This model is called “Triple Helix” but it has not been as successful as the government would expect it. According to the 2016 statistics about 50% of the Dutch SDI are not content with the support of the government. Their complaints refer to the bureaucratic obstacles originated from the Dutch government and the EU Directive of Defence Procurement.
Dutch DSI and major defence procurement programmes
Over the last 17 years the Dutch DSI is involved in the development and production of the F-35 fighter aircraft, as one of the original nine partner nations of the programme. Currently, 27 Dutch companies have been awarded work as part of the manufacturing programme of the F-35, while 10 have active contracts for a total value of 750 million US Dollars.
Among others, Fokker provides in-flight opening doors, flaperons, titanium engine parts and arresting gear for the F-35s, while Fokker's sister company, Fokker Elmo, has been awarded the contract for the complete JSF wiring and inter connection systems.
In 2014, Aeronamic B.V. signed a contract for the manufacturing, production, final assembly and testing of the forward Module as part of the F-35 Power & Thermal Management System, which will take place in the company’s main facility in Almelo. Other Dutch companies that have already signed contracts for the delivery of parts for the F-35 Lightning, are Thales Nederland, Aeronamic and KMWE. It is expected that overall, the F-35 programme in the Netherlands, will generate in total more than 5 billion Euros in framework contracts, 8-10 billion in production contracts, 15-20 billion in maintenance contracts, and up to 5,000 long-term and high-quality jobs .
The second most important Dutch defence procurement programme that involves the local defence industry is the construction of the new frigates of the RNN and the Belgian Navy that will replace the existing four M-Class frigates. The new four frigates, two for the RNN and two for the Belgian Navy will be built at Damen Schelde Naval Shipbuilding and will be fitted with an integrated mast made by Thales Netherlands. The total value of the shipbuilding programme is between 2.5-3.5 billion Euros.
The third most important Dutch defence procurement programme that involves the local defence industry is the construction of the new submarine that will replace the four ageing Warlus-class submarines of the RNN. The Navy evaluated four candidates, the A26 Swedish submarine of the Saab Kockums /Damen consortium, the Type 212 Upgraded German designed submarine of TKMS (Upgraded), the S-80 submarine of the Spanish shipyard Navantia and the SSK version of Barracuda-class submarine of the Naval Group/Royal IHC consortium. Decision is due 2019 and the estimated cost of the programme is 2.5 billion Euros.