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Singapore Technologies Kinetics (ST
Kinetics) continues its transformation journey in
its quest to meet the changing needs of its key customer.
Its re-alignment will enable it to deliver increasingly more
intelligent solutions for the network-centric battlefield.
At the same time, it has made progress in growing its commercial
business.
(I) The Emergence of A New Era
ST Kinetics is geared for change. It is transforming itself
and building new capabilities to address the fundamental shifts
in customers’ needs and in the defence industry.
ST Kinetics’ customer value proposition is three decades
of expertise combined with innovative new solutions.
In defence, this means reduced focus on conventional warfare
but greater emphasis on a “systems” approach to
smarter, network-centric solutions. The result will be multi
functional integrated land systems such as multi role land
systems, and guided weapons and munition.
Its commercial business continues to unfold, with a growing
portfolio of automotive services. Aggressive expansion into
the regional markets through joint ventures in China has increased
its subsystems and speciality vehicle capabilities significantly.
Efforts are ongoing to remain competitive in a challenging
economic climate. ST Kinetics’ Six Sigma, which began
in 2001 along with other productivity initiatives, has resulted
in projects with potential savings of more than S$8m.
On the safety front, the Company continues to maintain stringent
standards at all its automotive, weapons and munition facilities
and will continue to improve on its safety performance. The
Company was recently audited to comply with international System
Safety requirements (Military Standard 882).
Moving forward, ST Kinetics is keeping up the momentum in
developing new solutions to address rapidly changing user demands.
Such innovations won the Company recognition by SPRING Singapore
through the Singapore Innovation Class in March.
(II) Smart Solutions for the Modern Battlefield
ST Kinetics continued its quest to deliver advanced engineering
solutions for the modern battlefield in 2003. Backed by a growing
patent base of cutting edge inventions, the Company showcased
its “smart” and cost effective defence products
around the world.
Of special note was the 40mm Air Bursting Munition System
(ABMS), a weapon upgrade kit which fits on all current 40mm
Automatic Grenade Launchers. The ABMS is the only 40mm grenade
with a programmable time-based fuze technology available today.
Other innovative products included the M113 Hydro Mechanical
Continuously Variable Transmission (HMCVT) upgrade kit, which
significantly improves the performance of the vehicle, and
the Motor Generator (MOGEN), a hybrid automotive subsystem
that incorporates an electric and motor unit to offer even
better acceleration and steering response. When operated on
its electrical power, the MOGEN enables a vehicle to move in
the silent (stealthy) mode. Additionally, it can be used as
an auxillary power source.
In November, a new 30mm Remote Naval Weapon Station (NRWS) prototype
was launched. The NRWS is a light weight and stabilised gun mount
that can be integrated on board naval ships such as coastal patrol
craft and supply vessels without any intrusion into the deck.
Easily customised to accommodate a variety of medium calibre
cannons (eg 25mm and 30mm calibre) as well as a coaxial 7.62mm
machine gun, the NRWS is a dual system mount that offers the
added lethality of surface-to-air (SAM) missiles to enhance its
versatility and effectiveness against varying threats. It can
be remotely operated from inside the naval vessel, providing
protection for the operator.
In addition, a new Light Strike Vehicle and a prototype Squad
Support Weapon were developed in 2003. Work also began on a demonstrator
to showcase the Bronco All Terrain Tracked Carrier’s Active
Coupling System. The revolutionary concept enables an articulated
vehicle to be coupled/decoupled while on the move – allowing
it to operate as one unit or as two separate, independent entities.
On the home front, ST Kinetics continued to supply
the Singapore Armed Forces (SAF) with its most innovative
and cost effective solutions. The contractual delivery
of SAR 21 assault rifles and Bronco All Terrain Tracked
Carriers to SAF proceeded as planned. In November,
the Primus 155mm 39 calibre Self Propelled Howitzer – a
tripartite developmental effort between the Singapore
Army, the Defence Science and Technology Agency and
ST Kinetics – was commissioned for service into
the Singapore Artillery by the Defence Minister. The
Primus offers a fully automated ammunition handling
system and can deliver a maximum range of 30km using
extended range projectile. Custom built to meet objectives
that require optimal firepower and mobility, the Primus’ superiority
lies in its ability to deliver large volumes of payload
onto targets accurately and in the shortest time.
In the defence export business, ST Kinetics penetrated
the global market, signing on customers as well as
establishing new alliances through collaboration on
major programmes and strategic joint ventures. It participated
in various international exhibitions, including IDEX
in UAE in March; and DSEi in the UK, IDEF in Turkey,
AUSA in the US, IMDEX in Singapore and Defence in Thailand – all
in the second half of the year.
ST Kinetics’ business development efforts saw the
Bronco undergo rigorous evaluation trials by potential
customers in Europe and Turkey, and a live ABMS demonstration
for international customers in Singapore in October.
It also inked a Letter of Intent with a new African customer
in the first quarter of 2003.
In October, ST Kinetics signed two cooperative agreements
with leading Turkish automotive manufacturer, Otokar
Otobus Karoseri Sanayi A. S. (Otokar). The first agreement
on the Terrex (called Yavuz in Turkish, meaning “robust
and forceful”) provides the framework for joint
collaboration on design, manufacturing and agreement
on marketing rights.
The second agreement with Otokar sets the basis for
marketing ST Kinetics’ Bronco (called Sakarya
in Turkish, named after the city where Otokar’s
manufacturing plant is located) to the Turkish Land
Forces. Both companies believe that the Yavuz and Sakarya
have potential in meeting the requirements of the Turkish
Armed Forces.
(III) Engine for Commercial Growth
ST Kinetics is equally determined to grow its commercial
business sector. To achieve this, it focused on expanding
its automotive services, automotive subsystems and
specialty vehicles businesses by leveraging on its
internal capabilities and its investment in dual use
technologies worldwide in 2003.
The Company was awarded a two year contract by the
Civil Aviation Authority of Singapore (CAAS). It will
manage the CAAS Changi Vehicle Workshop and provide
repair, preventive maintenance and breakdown services
to CAAS vehicles operating in the airport and military
airbases.
ST Kinetics’ automotive services business in
Singapore also saw significant milestones in 2003.
STAR Automotive Centre opened its new headquarters in
January. Designed to promote operational efficiency while
providing a calming environment for its customers, it
is focused on providing a standard of service that is
second to none. To date, STAR is the Authorised Accident
Repair Quality Workshop to 18 insurance companies. Since
the commencement of STAR’s franchising scheme in
the second quarter of 2003, it has signed on two franchisees.
It was also appointed authorised service partner for
KIA commercial vehicles in Singapore in July – an
important achievement in its vehicle fleet maintenance
business.
STA Inspection commenced operation of two additional
Independent Damage Assessment Centres, located at Portsdown
Road and Pandan Avenue this year.
CityCab, ST Kinetics’ associated company, embarked
on a new initiative to develop a new taxi booking and
despatch system based on GPRS technology, expected
to be launched in 2005, to better serve its customers.
Singapore Test Services upgraded its instrument calibration
capability to include humidity chambers and radio frequency
equipment. It further enhanced its Product Reliability
Testing capability with additional drop test and walk
in climatic chamber facilities. Its Non Destructive Testing
capability was augmented with an automated Eddy Current
Testing system and the use of the Internal Rotary Inspection
System for the inspection of boilers.
In the US, ST Kinetics’ associated company, Solectria,
unveiled its hybrid diesel-electric “Super 7” series-parallel
drive system for heavy trucks in July. This system meets
the growing demand for more environmentally friendly
and fuel efficient drive systems for heavy commercial
vehicles. Since the launch, it has covered some 10,000km.
It also developed a dual use Auxillary Power Distribution
System to supply high quality, mobile AC and DC electrical
power.
(IV) Breaking New Ground
The future will see ST Kinetics ramping up its commercial
business through investments in specialty vehicles
and related subsystems companies. This will lay the
groundwork for its commercial business revenues to
grow its contribution to the Company’s total
revenues in the longer term.
In April, the Company announced its intention to form
a 50:50 joint venture with Beijing Heavy Duty Truck
Plant, subject to regulatory approval. The new company,
Beijing Zhonghuan Kinetics Heavy Vehicles (BZK), is
expected to begin operations in early 2004 and will
allow ST Kinetics to tap into China’s huge and
rapidly expanding economy.
BZK will design, manufacture and market heavy specialised
commercial and industrial vehicles such as articulated
dump trucks, off road dump trucks, bulk cement tankers
and concrete mixers from its facility in Beijing, China.
The products will be sold in China and later, to overseas
markets.
As part of its ongoing rationalisation process, ST
Kinetics announced the liquidation of Founders Industries
and Ordnance Development and Engineering Company of
Singapore in September.
(V) Moving up the Value Chain
ST Kinetics is moving up the value chain to produce more
advanced land systems solutions for its customers.
The
Company’s capabilities and track record
as a defence systems integrator and its dual
use technologies will enable it to grow in tandem
with the evolving requirements of key customers
like the SAF. At the same time, these capabilities
will attract new defence and commercial customers
from international markets.
The journey of transformation is a long one.
But it is one that will put ST Kinetics in
a stronger, more competitive position in the
long run.
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