AEC: The biggest single player in the Saudi defense industry

To the layman, the Advanced Electronics Company (AEC) may not mean anything at all. But for those who are in the know, it means much.

The biggest single player in the Saudi defense industry, it has catapulted the Kingdom into the field of electronics.

With sales exceeding SR1.3 billion in 2009, it manufactures equipment for F15 fighter aircraft, tactical radios for the army, guided lasers and guided bomb decoys, among others. In the past, it also manufactured spare parts for the US military's F16s.

"AEC is at par, if not better, with the world's best. It has earned for the Kingdom the respect of 41 well-known local and foreign customers," said AEC CEO and President Ghassan Alshibl.

AEC's local customers include the Saudi Armed Forces, Ministry of Interior and ministries of water and electricity, while its foreign clients include the US Navy, US Air Force, Boeing, and the Ministry of Communications in Kuwait.

AEC has also adhered to Saudization policies.

"About 90 percent of our technical and engineering positions are held by Saudi nationals, simply because some contracts have to be implemented by them. They define solutions and systems according to the needs of the customers," said Alshibl.

AEC has at least 2,000 employees and management staff who work at the headquarters near the airport.

AEC has kept pace with new developments by acquiring the latest technology in the various sectors it has been involved with.

"The transfer of technology forms part of our contract with reputable foreign companies that supply us with different equipment in various fields. They agree, seeing the fact that it opens up future opportunities for them in the local market to sell their products and offer their services to Saudi companies. Moreover, with the technology that we have acquired, we have also developed our own products," said Alshibl, who became AEC's CEO and president in 2003 after serving the company since 1983.

Initially, AEC was focused on programs related to defense when it started operating in 1990.

The offset economic program was initiated by the Ministry of Defense and Aviation (MODA), which fully adopted technology transfer and established programs in which AEC was able to participate.

"Through our participation in the different programs we were able to create a solid industrial capability related to the area of electronics production systems. Once we created that we started branching out commercially. It was a progressive range of capability that we went through in terms of the complexity of what we were utilizing, until we were able to basically tackle any competitive electronics production systems," Alshibl said.

Since then, it has branched out into other areas by creating subsidiaries such as the Industrial System Business Unit (ISBU), Energy Metering, Energy Automation Solutions, Energy Automatic Products System, Engineering Services, Order Fulfillment Support and Security Systems.