Upgrading in Global Value Chain of Malaysian Aviation Industry

This paper reviewed the concept of value chain upgrading of emerging companies in the global value chain. Moving up the value chain or upgrading is the way forward for manufacturers in the future. By manufacturing higher value added products or more significant components, firms will position themselves at a higher tier position within the global value chains. The chosen industry for the study is the Malaysian aerospace industry. The National Aerospace Blueprint launched in 1997, targets at making Malaysia a major aerospace player in the global scene by 2015. The blueprint identifies four focus areas mainly: (1) aircraft parts and components manufacturing, (2) maintenance, repair and overhaul, (3) avionics and systems integrations and (4) aerospace training. The study will adopt an explanatory case method (Yin, 2009). This allows an in-depth understanding of the global value chain in the Malaysian aerospace industry. Initial findings from the preliminary interviews have found that the industry has achieved commendable success as a first-tier manufacturer of specialized components and equipments for BOEING Inc.