The Business Year

Walid Abukhaled


High Fliers

CEO, Northrop Grumman KSA


Walid Abukhaled was most recently Deputy Minister for Industrial Affairs at the Ministry of Commerce and Industry in Riyadh. Prior to that, he was President and CEO of GE, Saudi Arabia and Bahrain, during which time he led the company’s operations. Before joining GE, he worked for BAE Systems in Saudi Arabia in a career that spanned more than 20 years and was most recently Director of Portfolio Management. In this position, he was posted to the UK for two years to develop strategies for growth and inward investment opportunities in Saudi Arabia.

TBY talks to Walid Abukhaled, CEO of Northrop Grumman KSA, on Saudization, the defense industry, and research activities in the Kingdom.

What is the importance of the Saudi market and the relationship with Saudi Arabia for Northrop Grumman?

Northrop Grumman is an advanced security company. We have been in the Kingdom of Saudi Arabia for almost four decades. The business started with five aircraft for the Royal Saudi Air Force, and since then the relationship has been excellent. The advanced systems of KSA are unparalleled and date back decades. During that time, two major joint ventures have been established, one with Vinnell Arabia and one with Northrop Grumman Mission Systems Saudi Arabia. These are our partners and our way of saying that we are committed to the Kingdom.

How has this relationship continued to evolve, and what plans do you have to be more committed to the country?

Before, we had a presence through individual business sectors within Northrop Grumman, but the decision was made in late 2012 to mid-2013 to have a corporate-wide presence in the Kingdom. As a company, we started with four priority countries, the UK and Europe, Australia, the UAE, and Saudi Arabia. Now, we represent Northrop Grumman 100% here, and we want to grow the business. To do so, we have set a strategy looking at what is important for Saudi Arabia. Saudization is important for the country through training and educating the country’s youth, as well as technology transfer, know-how transfer, a diversification of the economy, and so forth. All of these are part of the government’s strategic plan. We needed to ask ourselves what we can do as a company to support the government, because we look at it as a partnership, and not as just regular business. We are here for the long term, and so we looked at those initiatives. Hence, we have a commitment to offer as many jobs as possible to Saudi citizens. Already, in total, with our joint venture, we have about 1,700 employees, some 60% of whom are nationals. We would love to bring this figure to 80%, but we are dealing with the most advanced technology, and so it takes time to train people to the required level. Still, we are establishing special programs where, for example, some 90,000 students study in the US through the King Abdullah Scholarship Program.

How do you see the defense sector in Saudi Arabia developing over the long-term?

We are absolutely committed at Northrop Grumman to developing the aerospace defense or the defense and security industry in the Kingdom. Our strategy is that when we win major contracts, we are not going to fly a Northrop Grumman employee from elsewhere to do the job. What we do is work through the local supply chain, which means that we would look at the capabilities of the various Saudi companies involved in the defense and security industry, and start a partnership. We are looking to manufacture products under licenses from Northrop Grumman. In the long term, it is not only about manufacturing and supporting our services here in the Kingdom, but for the whole region. Saudi Arabia can be the hub to support our products globally.

How much of Northrop Grumman’s R&D is being done in Saudi Arabia, and what are the long-term plans to expand this?

Soon we will announce a deal that we are already engaged in with the Prince Sultan Advanced Technology and Research Center to explore all opportunities possible. However, we are committed to looking more at R&D, and it would make more sense for us to work with R&D organizations that have a link with our product portfolio, which is exactly what we are doing with PSATRI. We have already started getting the ball rolling, and there are some opportunities that we are working on. We are also working with King Saud University in relation to C4I and cyber security. We believe that it is extremely important for the younger generation to start to understand and learn more and benefit from this technology.



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