Investment by US-based Moog Inc. triggers high-tech defence exports
Moog Inc. is a US-based engineering company. It makes motion control and electronic solutions for industrial, defence and aerospace customers. These include flight controls for the new F-35 Joint Strike Fighter aircraft.
Moog Inc. set up an Australian subsidiary in 1979, called Moog Australia (Moog). Since then, Moog has become a key supplier to the Australian defence forces. Moog’s manufacturing centre in Melbourne supports a range of specialist motion-control devices for critical Australian Defence Force (ADF) assets, including the Collins-Class submarines and the F/A-18 Super Hornet.
The company is increasing investment in Australian engineering — especially in the Defence and aerospace sector. This will also help the company expand into the Asia-Pacific region.
‘We added 30% to our manufacturing capacity in Melbourne in 2021’ says Bryan O’Connor, General Manager, Asia-Pacific. ‘We have invested about A$4 million in buildings and capital since 2014.’
Investment helps build IP and skills in Australia
Moog is also building a highly skilled workforce.
‘Our staff levels have risen by 50% over the last 5 years,’ says O’Connor. ‘This has created high caliber technical roles for the local workforce.’
Moog has transferred some intellectual property (IP) from the US and Europe. But the local workforce is now building IP here in Australia.
‘We invest 3.5% of sales on research and development,’ says O’Connor. ‘This is helping us to build and sustain sovereign capability in Australian defence manufacturing.’
Australia is natural place to invest for US defence companies
Moog sees Australia as a natural base for regional expansion.
‘We made a strategic decision to locate our Asia-Pacific headquarters here in Australia,’ says O’Connor. Moogs product and applications are predominantly used by the five eyes alliance of which Australia is a key member.’
‘There’s also an “ease of doing business” factor,’ he adds. ‘The regulatory environment in Australia aligns well with the US in terms of compliance with GAAP (Generally Accepted Accounting Provisions), Sarbox (the Sarbannes-Oxley Act of 2002) and export controls. This makes Australia a relatively easy place to navigate from a US corporate perspective.’
The four factors that make Australia a great investment destination
O’Connor also cites four other factors that make Australia an ideal location for investment by defence manufacturers.
- The Defence industry is growing strongly. Australia is set to spend A$274 billion on its ten largest defence procurements, mostly during the coming decade (Source: ASPI, The Cost of Defence, 2020-21, page 14, accessed August 2021) (PDF 3.8MB)
- A science and research ecosystem that collaborates with the advanced manufacturing sector. O’Connor cites the national science agency, CSIRO and Defence Science and Technology (DST).
- Universities that are open to working with advanced manufacturing companies that push design boundaries. Moog cooperates with the local university sector to develop existing and future skills.
- A critical mass of industrial activity that can support complex manufacturing. This is important as Moog Australia expands its supply chains.
‘The Australian defence force has a collaborative relationship with the defence industry in Australia,’ says O’Connor. ‘We have strong ties with our customers in the ADF and DST.’
Austrade helps Moog Australia build global contacts
Austrade has helped connect Moog executives to key stakeholders. O’Connor says that the connections made with the support of the Austrade team continue to benefit the company.
‘Austrade advisers based here and overseas are helping us to extend our geographic reach,’ he says. ‘I have taken part in several overseas defence trade missions, which have added significant value.’
‘Also, Austrade provides market analysis, and helps us assess potential barriers,’ he adds. ‘Their advisers help us to understand the nuances of doing business in different cultures.’
Global growth powered by Australian IP
Moog Australia is set for further global growth. The company will design and manufacture mission-critical defence solutions from its expanded, secure facility in Melbourne. It will focus on weapon systems and precision motion control, and pursue markets in the Asia Pacific region.
‘Our expansion shows our commitment to support the ADF,’ says O’Connor. ‘We are helping Australia to build sovereign capability for defence forces. And we support Australia’s Defence Strategy by increasing defence exports.
'What stands out in Australia is that people in the defence industry take pride in what they do. And the IP we develop here in Australia will be sold into global markets.’
The Australian Trade and Investment Commission (Austrade) is the Australian Government’s international trade promotion and investment attraction agency.
We deliver quality trade and investment services to businesses to grow Australia’s prosperity. We do this by generating and providing market information and insights, promoting Australian capability, and facilitating connections through our extensive global network.
To discover how we can help you and your business, visit austrade.gov.au or contact us on 13 28 78 (within Australia).