Mr Ralph Kaeding, general manager of Lufthansa's 1,500 sq m centre at the polytechnic's campus in Tampines, said at a news conference that it is in talks with with the Economic Development Board (EDB).

He said: 'Singapore is home to the biggest aircraft maintenance, repair and overhaul (MRO) cluster in South-east Asia. As the industry grows, we will also have to grow. Whether we go to Seletar or not is something we are now discussing with the EDB.'

If the venture takes off, it will be in partnership with Temasek as well, he said.

Confirming that talks are on with Lufthansa and Temasek Polytechnic, EDB's director for transport engineering Sia Kheng Yok, who also attended Thrusday's launch, told The Straits Times that discussions are also on with several other parties on setting up training schools at Seletar.

The future 140ha Seletar Aerospace Park will open in phases and be fully developed by 2018. A third of the space available has already been taken up by more than 30 companies.

The development of the new facility is key to meeting future infrastructure needs of an industry that saw a record output of $6.9 billion last year and is continuing to grow.

Manpower training is just as critical to support the growth, industry players said.

It is estimated that the 110 aerospace companies based here and engaged mostly in repair and maintenance of aircraft will need about 1,500 new people every year.

But polytechnics, universities and other aviation training schools here are currently churning out just 1,350 aerospace graduates a year.

Lufthansa's new centre at Temasek Polytechnic, which opened its doors earlier this month, will offer a range of courses for students and working adults.

It aims to train at least 250 students, including those from the polytechnic, in the first year.

The training facility is Lufthansa's first in Singapore and the fifth in Asia.