The Middle East MRO sector - AviTrader

AviTrader
MRO
May 2011 - www.avitrader.com
the middle east’s
expanding mro sector
aviation aftermarket
CFO Nightmare: Surplus Stock
sector neWs
• LTP, Gulf Technics, BAE Systems & more
AnAlysis: The Middle eAsT - All Things To All people

editor‘s Page 2
The Middle East MRO sector: Full steam ahead, with help from our partners
WelcoMe to our MAY 2011 issue of
AviTrader MRO magazine, our Middle East
special. This region, particularly the Gulf and parts
of North Africa, has been in the news frequently
of late, and for reasons that have been of concern
to aviation companies with interests there.
Political unrest and instability aren’t good for
anyone’s business, but the executives we consulted
in the course of our reporting spoke
with one voice when they said that their activities
have been largely unaffected - and they
all agreed that when the dust settles, the Middle
East will continue to develop as one of the
fastest-growing MRO industries in the world,
and one that they intend to have a piece of.
Wealthy state investment companies founded
on petro-dollar wealth have made their tiny
kingdoms in the Gulf responsible for some of
the fastest-growing seams of MRO activity in the
world. But the wealth doesn’t stop there: MROs
Engine overhaul at ADAT‘s Abu Dhabi facilities ADAT
Contents
in Jordan, Israel, Egypt and Turkey have moved
beyond catering to domestic fleets to take an increasingly
larger share of the market away from
higher-cost regions to the north and west.
Many of these companies are expanding their
capabilities across the board and are becoming
increasingly self-sufficient, but their success has
not been achieved - and will not be sustained
- without strong and wide-ranging partnerships
with not just the OEMs, but also MROs
and service providers from around the globe.
Lufthansa Technik’s Walter Heerdt summed it
up when he said: “not every airline in the region
builds up its own MRO capabilities. New
competitors will get their share of the market
- and so will we, but we don’t underestimate
the build-up of regional competition”.
This month, we’ve also consulted senior professionals
involved in the aviation supply chain
to elicit their views on every CFO’s worst night-
Airframe News . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Engine News . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Component News . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Cover Story: The Middle East’s Expanding MRO Sector . . . . . . . . . . . . 9-12
Aviation Aftermarket: Surplus Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . 13-14
IBA Analysis: MRO Middle Eastern style . . . . . . . . . . . . . . . . . . . . . . . . 15-16
IT News . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
News in Brief . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18-22
Industry People on the Move . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
mare - surplus stock, a concern that will without
doubt ring true to many of you in this era
of paring down and leaning up.
Our regular International Bureau of Aviation
contribution also looks at the Middle East MRO
sector, and provides key forecasts for the MRO
spend both in the region and worldwide in the
years to come. Our thanks to them, as usual!
Next month, we’ll move on to the subject of
engine life cycles and the ‘repair or tear down’
debate, while our summer special magazine
centres on the biggest airshow of the year,
which in 2011 is, of course, Le Bourget in Paris.
Starting in September, we look at landing gear
maintenance, followed by cabin maintenance in
October, managing efficiency in November and
we finish off the year with a look ahead to the
MRO sector in 2012. Why not contact us now
and give us your perspective on these and other
issues? We look forward to hearing from you!
AviTrader
MRO
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Email: peter.jorssen@avitrader.com
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editorial
Catherine Davies, Editor
Email: catherine.davies@avitrader.com
Tel: +44 (0) 1442 870 058
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AviTrader MRO - May 2011

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selected Airframe News
Lufthansa Technik Philippines breaks ground for new widebody hangar
Lufthansa Technik Philippines (LTP) broke ground for the construction of a new aircraft hangar in Manila, representing a S$30-million
investment and capacity expansion by LTP which will boost its capability in servicing the growing range of Airbus models that includes
the A320, the A330 and the
A340. The proposed new
hangar could also give LTP the
option to accommodate the
A380 aircraft which would
allow the company to further
build its capability on the
Airbus family. With a 8,448m²
footprint, the new hangar will
be built east of LTP‘s existing
four-bay hangar at the
Ninoy International Airport
complex. Upon completion,
the facility will be able to
accommodate one widebody
and two narrowbodies or
four narrowbodies. LTP’s new widebody in Manila will add a further 8,500m² to its existing facilities
Gregor Schläger / Lufthansa Technik AG
ExecuJet Middle East announces EASA
extension for Hawker Aircraft
ExecuJet Middle East‘s maintenance facility
in Dubai, UAE obtained an extension to its
EASA approval for the Hawker 400XP, 7, 8, 9
Series and 4000 aircraft and GCAA approval
for Hawker 8, 9 series and 4000 aircraft. In
addition to the EASA and GCAA approval
extensions, the Dubai facility was awarded
liNe MAiNteNANce
Ameco Beijing provides line maintenance services for UPS and Turkish Airlines
Ameco Beijing signed contracts with United Parcel Service (UPS) and Turkish Airlines to provide line maintenance services in different destinations
of China. Line maintenance services will be provided to Turkish Airlines in Beijing and Shanghai, to UPS in Guangzhou and Qingdao. Turkish
Airlines is Ameco’s new line maintenance customer while Ameco has been providing line maintenance services for UPS in Beijing since 2001.
Wizz Air signs with Monarch Aircraft Engineering in Spain
Monarch Aircraft Engineering (MAEL) signed a line maintenance technical handling agreement with Wizz Air Hungary. The agreement will see
Monarch’s experienced engineering team provide support to the Hungarian operator’s fleet of Airbus A320’s at Spanish line stations in Arrecife
(Lanzarote), Alicante, Malaga and Tenerife. The agreement takes place with immediate effect.
AeroLogic selects AMES for B777 line maintenance support
Airborne Maintenance & Engineering Services (AMES), a subsidiary of Air Transport Services Group, was selected by AeroLogic GmbH for
line maintenance support of AeroLogic’s Boeing 777 freighter aircraft at the Cincinnati/Northern Kentucky International Airport. AeroLogic is
headquartered in Germany at Leipzig/Halle Airport and conducts worldwide freight operations with a fleet of eight B777 aircraft.
Weekly Aviation
Newsletter
an Indian DGCA 145 approval. It is also an
Authorised Service Facility for Bombardier,
Embraer and Gulfstream.
GAMECO opens new ChongQing
maintenance base with CAAC approval
Guangzhou Aircraft Maintenance &
Engineering Company (GAMECO) opened
their ChongQing maintenance base. CAAC
click here »
for your free subscription
The latest aviation news from around the world. Straight to your inbox every week.
Southwest Branch awarded the ChongQing
base CAAC maintenance approval, making
it the first domestic maintenance base
for GAMECO outside their Guangzhou
headquarters. GAMECO will take over the
engineering staff from ChongQing Airlines
at ChongQing JianBei International Airport,
and will initially provide line maintenance
for ChongQing Airlines, as well as other
maintenance services.
4

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selected engine News
Complete Turbine Services adds
GE90 repair capability
Complete Turbine Services added GE90
series repair capability to its Operations
Specifications. With the announcement, the
company becomes the only independently
owned MRO in the USA with GE90 all series
repair capability.
Pratt & Whitney expands global
repair network to include PAS
Technologies
Pratt & Whitney and PAS Technologies signed
an agreement to establish PAS Technologies
Inc. as the exclusive designated service
provider for selected repairs on Pratt &
Whitney and IAE engine models. Under the
long-term agreement, PAS Technologies Inc.
will perform selected repairs on the PW2000,
PW4000 and IAE V2500 engine families.
Aveos and Alsalam sign engine
service agreement
Aveos signed a one-year Engine Technical
Service Agreement with Saudi Arabian
MRO, Alsalam Aircraft Company. Under the
agreement, Aveos is to repair, overhaul and
deliver up to eight JT9D-7A engine events
within 2011.
MTU Maintenance secures deals worth
some €400 million in first quarter
MTU Maintenance group released that in the
first three months of this year, new contracts
worth around €400 million were signed.
One of the largest was awarded by Atlas Air.
The U.S. carrier had started to send the CF6-
50 and CF6-80 engines powering its Boeing
747 fleet to MTU Maintenance Hannover
for maintenance, repair and overhaul (MRO)
back in 1999. Now the existing contract was
expanded to include additional engines and
renewed to run through 2020
Delta TechOps expands maintenance partnership with Evergreen Aviation
Technologies . . . .
Delta TechOps finalized an exclusive five-year engine maintenance contract with Canadian
charter operator CanJet Airlines. The fixed price, time and materials (T&M) contract covers
maintenance for CanJet’s CFM56-7B
engines, and expands Delta TechOps’
existing comprehensive component and
inventory logistics support for CanJet’s
fleet of Boeing 737-800 aircraft.
. . .and wins engine maintenance
deal from CanJet Airlines
Delta TechOps signed a five-year
component maintenance and exchange
agreement with Skymark Airlines to
provide advance exchange power-bythe-hour
(PBTH) services to Skymark’s
fleet of 25 CFM56-7B powered Boeing
737NG aircraft. The agreement expands
Delta TechOps’ current five-year
agreement with Skymark, in which it
The CFM56-7B engine Snecma
partners with comprehensive maintenance provider Evergreen Aviation Technologies (EGAT)
to provide engine maintenance services to Skymark’s fleet.
Air Canada signs agreement for GE’s myEngines
Air Canada signed an agreement with GE Aviation for its myEngines, part of the OnPoint Digital
Solutions. myEngines consists of digital app suites that help customers better manage their
engine fleets and improve productivity.
GOL and GE Aviation sign OnPoint services deal for B737NG systems
GOL Transportes Aereos and GE Aviation signed a five-year OnPoint services agreement for the
Boeing 737NG aircraft. The agreement covers repair services and logistics for all systems provided
by GE including various avionics, flight management, instruments and hydraulic systems for the
B737NG aircraft operated by GOL.
GE Aviation launches CF6 TRUEngine program
GE Aviation is launching the CF6 TRUEngine program, which expands the TRUEngine
designation from CFM56 engines to GE’s engines beginning with CF6. As part of the launch,
GE has awarded TRUEngine designation to Nippon Cargo Airlines’ (NCA) fleet of 43 CF6-
80C2 engines that power its Boeing 747 fleet.
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selected component News
AAR and Gulf Technics Partner to provide
supply chain solution for Gulf Air
AAR partnered with Gulf Technics to provide
an integrated supply chain and component
repair solution for Gulf Air, the national carrier
of Bahrain. The five-year program partnership
will combine parts supply, component repair,
distribution, information technology, and
logistics capabilities for Gulf Air‘s Airbus fleet.
AAR and Gulf Technics will manage the rotable
components supply chain for fourteen A320,
ten A330 and four A340 aircraft. In addition
to the rotable program, AAR and Gulf Technics
(GT) are exploring a joint supply chain and
component repair capability, outlined in an LOA
signed by both companies in March 2011.
Virgin Atlantic in 12-year component
support deals with AFI KLM E&M
Virgin Atlantic signed contracts with AFI KLM
E&M for component support on its new A330
fleet, extending the long-standing relationship
between the two partners. The first aircraft
was delivered in February 2011 with the last
of the 10 new aircraft being handed over
in late 2012. The deal involves component
repair, pool access and a main base kit at
London Heathrow.
Inventory Management*
The cornerstone for the
Quantum Control system. The
parts summary screen provides
a central viewpoint for all
information and activity
related to a given part.
Contact Management
tool integrated with Quantum's
entire suite of modules.
Enhances your ability to track
critical activity such as Sales,
A/R, Repair Management and
Customer Service calls.
Vendor Quotes*
Provides a tool to locate
sources for part procurement
and send out requests for
quotes to multiple vendors,
including multiple lines.
Quotation Processing*
Manages the customer
quotation process and the
recording of supplier responses
from outgoing RFQs.
Sales Orders*
Manages the customer
order process to include back
order management, invoice
preparation and product
returns.
Sales Exchange*
This powerful module provides
complete functionality
with unparalleled versatility to
handle
your
most
complex
e-x
change processes. Supports
brokered exchanges, work
order exchanges, routine exchanges,
repair
order
conve-r
sions to exchange and core
tracking.
Invoice Management*
Provides the opportunity
to manage the invoice process
by viewing system wide for
open sales orders and
determining if these can be
expedited or consolidated with
existing invoices, etc.
Shipping Management
Manages the shipping and
order consolidation process to
and statuses. Creates custom
invoices, packing slips and
shipment.
Purchase Orders
& Requests*
Manages the purchasing process
including request routing
and approval by dollar amount
and employee position. Manages
purchasing activity for
stock, non-stock and exchange.
Receiving & Inspection*
The receiving module is a
cost-saving receiving, interme-
gether with defect recording.
Bar Coding
Prints bar codes and
allows for the scanning of
physical inventory to track and
manage stock and account for
all parts when shipping,
receiving, etc.
Repair Orders*
Manages the preparation,
pulling from inventory, shipping
and receiving of components
sent out for repair. The
Repair Order module provides
historic as well as current
repair cost per component, detailed
by parts, labor and miscellaneous
charges.
MRO Business Software Integrated with
Aircraft Services
Contains features such as
the ability to record and track
Routine and Non-routine
maintenance. Integrated with
Inventory, Purchasing,
Quoting, Billing, Labor
recording and Publications
tracking. Bar Code module is
integrated as well for Labor
and Task Card updates.
Hangar Management
Allows for complete
resource management across
your aircraft service center
with the ability to quickly
assign tasks, view workers
productivity, and manage
unassigned work in real-time
through an intuitive interface.
CAMP Integration
Allows Quantum Control
users to increase regulatory
compliance
by
providing
rea-l
time access to maintenance
vice bulletins and airworthiness
directives through the
web-based CAMP Maintenance
Management system.
Avtrak Integration
Provides communication
between Quantum and the
Avtrak GlobalNet maintenance
the Quantum work order
module, drastically reducing
the possibility of data entry
cy in the maintenance system.
BAE Systems pays out dividends through Spares Co-op loyalty scheme
John Stevens
BAE Systems
A total of seven airlines have so far received a cheque in the post
from BAE Systems through their membership of the company‘s
Spares Co-op scheme, which rewards them for spending over and
above an agreed amount on aircraft spares. The biggest payday was
for Brussels Airlines and its fleet of 26 Avro RJ jets; the operator took
£186,000 of the total of £400,000 paid out to Co-op members.
John Stevens, head of customer support for BAE Systems Regional
Aircraft, says that the BAE Systems rebate system is unique: “We
don‘t know of any other supplier or OEM who’s doing this. Our
Co-op scheme is similar to a frequent flyer program, whereby the
benefits are bigger the more a customer spends above a threshold amount. We negotiate
individually with each customer, and agree a target based on their spend over the
previous three years. We then track usage and fleet profile, and as the customer buys
spares throughout the year, they progress on a sliding scale of increasing rebates.”
“For suppliers of aircraft parts, this kind of incentive-based program is not very attractive.
They’re under a lot of cost pressure as it is, and doing this would squeeze their margins
even further. But we’re the OEM for these aircraft and we want to reward customer loyalty.
We aim for quality - we tend not to deal very much in parted-out goods. ”
“In essence, we’re linking spares to technical support. BAE Systems’ Total Support package,
encompassing the Co-op scheme, is a complete technical solution. It’s not just about spares.
We’re leveraging our technical expertise for the greatest benefit to our customers”.
The scheme has grown to a dozen members since it launched in 2008. Stevens is looking to
South America, where Peruvian airline Star Peru is its largest customer, as the ‘next frontier’.
Manufacturing
The Manufacturing Module
addresses all aspects of
the manufacturing process
control, inspections, materials
planning, purchasing and
outside servicing.
Document Imaging
Provides for scanning of
documents or images directly
into the Quantum application.
Scanned Images or external
all the critical data elements in
Quantum. Various formats are
supported including PDF.
Lot Costing
Tracks acquisition costs,
teardown expenses, overhaul
and repair expenses as well as
miscellaneous charges. Single
screen visibility of lot related
activity including receiving,
sales, repairs and scrap
functions.
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MRO Shop Control
Manages the complete
Component and Assembly
Repair and Overhaul process.
Includes real-time Cost and
Schedule Management
functions that put you in
complete control of your
shop’s activity.
Repair Manual Tracking
Tracks all publications and
revision dates and review dates.
by part, customer and ATA.
Integrated with the Shop
Control module providing
for individual work orders.
Event Manager
Allows for automated
reporting, e-mailing and faxing
to customers, suppliers and
internal users. E-mail
created using pre-packaged
scripts or custom designed
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Integrated Accounting
The Accounting Module
includes General Ledger,
Accounts Receivable, Accounts
Payable, and more - all totally
integrated with Sales,
Purchasing, Repair, Exchange,
Work Order and Invoicing
modules.
Fixed Asset
master parts for depreciation
and tracking, and to modify
transactions such as how the
asset is sold, issued to a job or
scrapped. Transactions allowed
include purchasing, stock receiving,
invoicing, scrapping
and issuing, turn-ins, outside
repair, internal work orders and
changing acquisition value.
Time and Attendance
Accurately manages the
collection and tracking of employee's
work time. Shift pat-
overtime, grace periods, and to
identify exceptions requiring
management attention. Vacation
& holiday time is also
tracked and a payroll interface
extract is included.
QuickBooks
Accounting Bridge
Links Quantum to QuickBooks
Pro. Sends QuickBooks the
data required for G/L Account
Balances, Financial Statements,
and much more.
EDI Integration
Through its Electronic
Data Interchange (EDI)
module, Quantum users can
now
conduct
paperless
tran-s
actions with their business
partners. EDI transactions
range from quote to purchase
to invoice, and more.
The StockMarket
Quantum users can
search, buy, and sell parts with
other users in real time
without leaving the software.
Inventory postings are
automatic and can include
details such as serial numbers,
images, time life and prices.
Storefront Quantum
Allows customers to login
to your website to search,
view, RFQ or purchase from
your existing stock in realtime.
Information such as time
& cycles, tag info, scanned
documents and images can be
attached to the Stock item to
assist your customer in their
purchasing decision. You can
also include and advertise your
overhaul, manufacturing, and
distribution capabilities directly
to your customers.
Quantum Portal
Enables the presentation
of Quantum functionality to
users via a standard web
browser. Out of the box,
contains functional modules
for your customers to check
status and shipping
information for Sales Orders
and Work Orders.
Rental and Leasing
The Rental and Leasing
module has the versatility to
handle all of your rental and
leasing transactions including
AVREF Catalog Files
The AVREF Catalog System
provides the latest OEM pricing
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to
Government
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cross
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7

A321-200
GA Telesis, the WORLD LEADER in commercial aircraft and jet
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A310-300
A320-200
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Other Current Airframe & Engine Disassemblies:
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Engines Available for Lease
CFM56-3C1
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CFM56-5B4/P
CFM56-5C3F/G
CF6-80C2A/B1F
CF6-50C2
CF34-3A/B
V2533-A5
CFM56-3C
CFM56-5A
CFM56-5B
CFM56-5C
CF34-3A/B
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PW4077
PW4158-3
PW4056
JT8D-219
CF6-80C2A/B
CF6-50C2
PW4000
JT8D-219
V2500-A1

cover story - Middle east Mro 9
Full steam ahead in the Middle East
As Egypt, Saudi Arabia and Bahrain join the UAE, Jordan and Turkey in funding
major MRO hubs, OEMs and service providers from around the world rush to seal
strategic partnerships to cash in on the region’s fast-growing aviation market
lookiNg bAck over the PAst several
weeks, a clear image has emerged from
the Middle East’s aviation industry: Despite
political turmoil in the region and the highest
oil prices in over two years, the sector has
gone from strength to strength and shows little
sign of halting its breakneck expansion.
Just last week, Emirates, the Arab world’s
largest airline, announced record
profits for 2010, up 52% over the
previous financial year - and these
would have been at least $1 billion
more if the price of oil had not
spiked so sharply.
A few days before that, Boeing
revised its forecasts for the Middle
East aviation industry upwards,
suggesting that the region’s fleet
size will grow by 150% to 2029, with an estimated
2,340 new aircraft worth at least $390
billion required to fulfill demand.
The projected growth in traffic to and through
the region is pinned at 7.1% over the next several
years, far outstripping expected GDP growth
of 4% and highlighting the Middle East’s importance
as a cross-roads between Europe, Asia and
Africa. In fact, with today’s fuel-efficient longhaul
aircraft, there is no place on the planet that
cannot be reached in a single journey from any
of the major airports in the region.
The region’s MRO sector has its work cut out
to catch up with the rapid expansion in fleet
size, not to mention trying to capture an increasingly
large share of business from higher-cost
MROs in Europe and elsewhere. But
ambitious governments have poured billions
Morocco
• Aerotechnic
Industries (AFI/KLM
& Royal Air Maroc
into building the facilities to fix local and foreign
planes on Middle Eastern soil, as part of
their diversification strategy towards non-oil
and gas sectors. Airframe maintenance up to
C-checks is fairly widely catered to across the
region, while engine overhaul is largely OEMdriven
and mostly conducted in partnership
with the manufacturers. Component repair
and management, meanwhile, has become a
“competitive edge is gained through price,
location and connectivity between europe and
Asia. the sector will see a surge in growth due to
investment in infrastructure and human resources
- and the availability of financial resources.”
Ahmed Elnenaey, Gulf Technics
Tunisia
• Sabena Technics MIR
(j/v with Nouvelair)
key area for service providers from abroad to
gain a foothold in this thriving market.
AviTrader MRO spoke to a range of senior executives
at both Middle East-based companies
and firms from elsewhere to gain further insight
into the shape of things to come in one of the
world’s fastest-growing MRO market, and asked
aviation consultancy IBA Group to weigh in on
the appeal of maintenance Middle-East style,
for both regional operators and carriers from
further afield (see pages 15-16).
ON THE INSIDE, LOOKING IN - AND OUT
Middle Eastern MRO operators are well poised
to take an increasingly bigger slice of the global
MRO pie. Their advantages are clear, as Ahmed
Elnenaey head of research and business development
at the newly-launched Gulf Technics in
Bahrain puts it: “Price, location and connectivity
between Europe and Asia.”
Egypt
• Egyptair
Engineering &
Maintenance
Bahrain
• Gulf Technics
Saudi Arabia
• SAEI
• Alsalam
Elnenaey believes that the region’s MRO sector
will see a surge in growth over the next decade,
a result of infrastructural growth, the availability
of financial resources and investment in developing
local human resoures. “The effect of rising
oil prices is global, but this region will not
see the effects as much as European or Asian
carriers as the shareholders of most of the big
airlines enjoy rights to oil revenues”.
It is that access to petro-dollar
wealth that has been behind
the spectacular growth of the region’s
biggest growing concern,
Mubadala Aerospace in the
United Arab Emirates’ capital of
Abu Dhabi. The cornerstones
of Mubadala Aerospace’s MRO
global strategy are, of course,
SR Technics, in which it holds a
70% stake, and Abu Dhabi Aircraft Technologies
(ADAT), formerly GAMCO, which was a
joint venture between the emirate and the
Kingdom of Bahrain’s Gulf Air, but is now a
wholly-owned subsidiary.
It’s no secret that Mubadala is gearing up to become
one of the world’s largest players in the
MRO sector. Homaid Al Shemmari, executive
director of Mubadala Aerospace, told AviTrader
MRO that, through SR Technics and ADAT,
“Mubadala Aerospace is putting together a global
MRO offering which provides flexibility, reliability
and cost-effectiveness for its customers
and partners. Given the rapid expansion of the
region’s carriers, building capability and capacity
in Abu Dhabi is important but our strategy also
involves investing both locally and internationally
to increase the scale and breadth of the global
MRO network product offerings.”
The Middle East: a growing global maintenance, repair and overhaul hub
regional hotspots of Mro activity
Lebanon
• Masco
Israel
• IAI
Turkey
• Turkish Technics • Airlogic
• myTechnic • MNG Technic
Jordan
• JorAMCo
UAE: Abu Dhabi
Mubadala Aerospace
• ADAT
• SR Technics
• Sanad
Qatar
• Qatar Airways
Engineering
Oman
• Oman Air
Engineering
UAE: Dubai
• DAE Engineering
(Standard Aero
• Flydubai
• AMES (AFI/KLM & Safran)
AviTrader MRO - May 2011

cover story - Middle east Mro
Mubadala launched financing and leasing
subsidiary Sanad Aero Solutions early last year
in response to the need for airlines to finance
components and claw back a measure of liquidity,
completing a full-service offering to
airlines that takes some beating. Jeremy Chan,
the chief executive officer of ADAT, outlines
the synergies that the Mubadala Group com-
“our relationship with etihad illustrates
the growth potential offered by the
Mubadala Aerospace Mro network to
provide airlines with scale.”
Jeremy Chan, ADAT
panies offer through various contracts with
Abu Dhabi flag carrier Etihad and the applications
this has for other airlines.
THE MUBADALA ONE-STOP SHOP
The first step was a five-year deal, signed by
Etihad with ADAT in 2007 for integrated MRO
services including A and C-checks, technical
services, procurement and logistics services
and engine services.That was followed by
a 10-year Integrated Components Services
agreement, sealed with SR Technics in 2009
for its entire Airbus fleet, while ADAT was
awarded contracts to upgrade seating and inflight
entertainment systems in six of its Boeing
777s and ten Airbus A320s.
Last year, the carrier sealed a 10-year financing
program, worth over $30 million, with Sanad as
part of the total component solution between
SR Technics and Etihad for its entire Airbus fleet,
with ADAT providing onsite tech-
nical and logistical support. SR
Technics and ADAT also provide
comprehensive technical training
support for all Etihad Airbus and
Boeing types.
“The relationship established
with Etihad Airways by the
companies that form the Mubadala Aerospace
global MRO network illustrates the growth potential
offered by us working closely together
and providing airlines with scale through our
Middle East and European centres of excellence,
a wide breadth of product offerings and
financing solutions,” says Chan.
Etihad is still a relatively new airline with a
young fleet, and although it is a major focus of
the group’s MRO activities, third-party business
is central to Mubadala’s strategy, with close to
70% of its business involving other airlines, in-
cluding Air Arabia, Fly-
Dubai, Air Berlin, Thomas
Cook and, most
recently, Onur Air.
The group is investing
significant amounts to
further expand ADAT’s
infrastructure and capabilities,
including a
three-bay A380-ready
hangar extension, a tar-
10
Jeremy Chan, ADAT CEO
Mubadala
geted 100% increase in heavy-check capacity,
increased 777 and 747 capability, major EASA
Part 21J DOA in 2011, the establishment, with
SR Technics, of a training school and the adoption
of Oracle cMRO’s integrated ERP system.
While many MROs in the region are honing capabilities
around airframe maintenance, ADAT
aims to become a one-stop shop for the sector,
and as such, has formed partnerships with
major OEMs including GE, Rolls-Royce, Airbus
and Boeing. In December, it revealed details for
the world’s first GE and Engine Alliance network
partner overhaul shop and test cell facility
for GEnx and GP7200 engines, followed by an
agreement in January with IAE to help it become
an IAE-approved MRO for B3 level overhauls on
the V2500 engine series. “That agreement is

cover story - Middle east Mro
built on our commitment to form strong alliances
with OEMs,” said Chan.
HUBS OF EXCELLENCE - EVERYWHERE
Mubadala’s example is being replicated around
the Gulf region, as other states seek to diversify
beyond the oil and gas industry. Aviation MRO
is a natural fit, given the region’s location, its
low labour costs, ready access to governmentbacked
investment funds and available land,
earmarked for major aviation mega-projects
like Dubai’s Al Maktoum International Airport at
Dubai World Central, the 140km² aviation and
logistics city under construction at Jebel Ali.
Like Mubadala next door, Dubai’s aviation investment
vehicle, Dubai Aerospace, went on a shopping
spree before the financial crisis of 2007-08,
acquiring US-based Standard Aero, one of the
largest independent MROs in the world. It also
holds a 30% stake in SR Technics.
Emirates’ facilities are enviable by any standards.
It has seven A380-capable bays, a
paint facility and a
150,000 lb thrustcapable
engine test
cell, catering to
close to 30 thirdparty
customers. It
subcontracts some
engine and component
repair out
to OEMs including
Rolls-Royce and
GE, but with its massive fleet expansion plans,
incorporating a total of up to 120 A380s, it is
keen to bring additional capability in-house.
That pattern is being repeated up the coast in
Qatar, which is set to open the $14.5 billion
New Doha International Airport (NDIA) on land
reclaimed from the Arabian Gulf next year. The
BUSINESS JET BONANZA
NDIA will house Qatar Airways’
line and heavy maintenance
operations, with
air-conditioned hangars able
to accomodate five A380s,
three A340-600s and four
A320s simultaneously. Most
of the airline’s D-checks are
outsourced, but the plan is
to bring them in-house when
the new airport becomes fully
operational.
“our new component centre
paves the way for gulf technics
to enter into component repair
and manufacturing, which will
strengthen bahrain’s position in
the global aviation industry.”
Talal Al Zain, Mumtalakat (Bahrain)
Self-sufficiency in serving expanding
fleets is a key strategy
in Bahrain, where local
MRO Gulf Technics opened
the doors to its new Component
Centre last month. The
company is fully owned by the Bahrain government’s
investment vehicle, Mumtalakat, and is a
central part of the kingdom’s Economic Vision
2030, focused on investment in strategic nonoil
and gas based industries.
Mumtalakat aims for
the Component Centre,
which offers maintenance
support including
warehousing and
supply of components
and spares, to become
a regional player in the
business and a ‘significant
contributor to
Bahrain’s economy’. It plans to develop Bahrain
International Airport as an airline maintenance
hub, thus reducing flag carrier Gulf Air’s maintenance
costs by approximately $50 million over
the next five years. According to Mumtalakat’s
chief executive, Talal Al Zain, the new Centre
‘paves the way for Gulf Technics to enter into
component repair and, ultimately, components
The business jet market in the Middle East is a sector in rapid expansion, given the number of
high net worth individuals in the region and the volume of executive travel to and from oil-rich
Abu Dhabi and the trade hub of Dubai. There are two main players supporting the business jet
market, ExecuJet and Jet Aviation, both of which have partnered with local entities in order to
capture an increasing share of the BBJ MRO business that historically went to Europe.
ExecuJet opened in Dubai 12 years ago with a staff of 10, and has now expanded to 243. The
company is primarily targeted at third-party business jet operators, and is authorized to support
OEM products such as Bombardier, Gulfstream, Embraer and Hawker.
It took on a second hangar in Dubai last year, more than doubling its maintenance capacity, and
recently signed a new partner in Doha that will become ExecuJet Qatar, showing that ‘there is
still a great deal of business in the region”. The company recently announced that the Dubai
maintenance facility had obtained an extension to its EASA approval for the Hawker 400XP, 7, 8,
9 Series and 4000 aircraft and GCAA approval for Hawker 8, 9 series and 4000 aircraft.
“The Middle East is a key asset to the ExecuJet brand,” said the firm’s Middle East managing
director Mike Berry, “and will continue to be so. The key is to offer world-class support
within the region as operators don’t want to have to ferry aircraft to foreign MROs, due to
increased costs and logistics.”
11
Emirates Engineering’s seven maintenance bays can each accommodate an
Airbus A380 superjumbo Emirates
manufacturing, which will strengthen Bahrain’s
position in the global aviation industry”.
Last month, Gulf Technics took over all components
support for Gulf Air from Lufthansa
Technik in what it says was ‘a seamless transition’.
The recently-announced partnership with
US aftermarket service provider AAR Corp to
provide an ‘integrated supply chain and component
repair capability to serve Gulf Air’ is the
first step in its quest to create a regional aviation
asset management hub.
In line with the thinking that there can never
be enough hubs, Saudi Arabia also announced
its own plans to become a major aviation centre.
Saudi Arabian Airlines recently completed
the privatization of its in-house MRO division
and renamed it Saudia Aerospace Engineering
Industries (SAEI), issuing an invitation to
potential investors to acquire up to 30% of
the newly-privatized company’s capital. Its first
transaction was a long-term deal signed with
the national carrier for the maintenance of its
125-aircraft fleet, which includes 44 new Airbus
A320/321s and A330s.
The creation of SAEI is part of a masterplan
to make Saudi Arabia ‘the major centre for
the commercial aircraft industry in the Middle
East and Gulf regions and boost the national
economy’, aided by the development of a new
150,000m² state-of-the-art MRO facility at
King Abdulaziz International Airport in Jeddah.
Close to 90% of the fleet’s engine maintenance
is carried out in-house, both through own capabilities
and partnerships with OEMs like GE,
with which it has a 10-year materials support
agreement. Other manfuacturers like MTU Aero
Engines and Pratt & Whitney are active in the
country, through their shareholdings in MEPC, a
Saudi engine MRO for military aircraft.
MORE TO THE MIDDLE EAST THAN THE GULF
With all the fanfare surrounding the industry
in the Gulf, it might be easy to overlook other
areas in the region were it not for the formidable
reputation surrounding market leaders like
AviTrader MRO - May 2011

cover story - Middle east Mro
Jordan’s JorAMCo and a whole range of Turkish
MROs (see AviTrader MRO - May 2010) , as
well as growing concerns like Egyptair Maintenance
and Lebanon’s MASCO.
Like their Gulf counterparts, these companies
have capitalized on their location, attractive
rates and a reputation built on experience
and skill as well as flexible TATs and late slot
bookings. Indeed, JorAMCo has become one
of the leading full-service MROs in the region,
with up to 70% of its business coming from
third-party carriers in Europe, Asia and elsewhere
in the Middle East. It carries out maintenance
up to D-checks on a range of Airbus,
Boeing, Embraer and Lockheed models and,
through a range of partnerships with companies
like Messier-Bugatti, Goodrich, Eaton
and Avtrade, is becoming a regional leader in
component repair and management.
For Egyptair Maintenance, attracting business
from both regional and European budget airlines
is a major goal as it seeks to boost the percentage
of third-party customers served from its
current 20% to up to 50% by 2015, according
to the company’s head of advertising and public
affairs, Khaled Omar. Egyptair Maintenance
Airframe and engine maintenance at ADAT, Abu Dhabi ADAT
recently won a contract to conduct heavy maintenance
for Saudi budget carrier Nasair and also
has deals with a range of regional charter and
scheduled carriers.
With European MROs increasing the amount
of outsourcing they do to low-cost regions, together
with the
introduction of
new generation
aircraft, Omar
points out that
key players in
the sector worldwide
are seeking
strategic partnerships
in the
Middle East as a
way into the lucrative market. A case in point is
the Cairo Engine Shop, a joint venture between
Egyptair Maintenance, Rolls-Royce and Lufthansa
Technik that was set up in 2009, and which
has full overhaul capacity for the IAE V2500 and
CFM56 engines as well as disassembly/assembly
and testing capability for a range of other powerplants,
including the Rolls-Royce Trent 700.
PARTNERSHIPS - A WIN-WIN FOR ALL
It’s partnerships like these that
will further build the reputations
of the Middle East’s facilities
and provide a welcome avenue
of growth for established
MROs in high-cost Europe.
“The Middle East is one of the
fastest-growing MRO markets,”
says Walter Heerdt, senior
VP for marketing and sales
at Lufthansa Technik (LHT).
“Not every airline in the region
builds up its own MRO capabilities.
New competitors will get
their share of the market in the
future - and so will we, but we
don’t underestimate the buildup
of regional competition.”
LHT has invested heavily in the
Middle East. In addition to the
Cairo Engine Shop venture,
it has long-term plans with
Oman Air to build a heavymaintenance
facility at Muscat
International Airport. It is also
one of the bigger players in the
region, with contracts ranging
from a deal with Qatar Airways
to perform 24 C-checks
on nine A320 family and 15
A330 aircraft, in addition to a
10-year Total Engine Support
contract for the carrier’s A320
fleet, and an agreement with
Etihad to retrofit the airline’s
entire fleet with its Guideline
12
ColourFit emergency floopath guidance system.
It also has a two-year deal with Emirates
to overhaul the centre landing gears of its Airbus
fleet of eight A340-300 aircraft, as well
as a base maintenance deal for the carrier’s
15 Boeing 737NGs and and a component support
deal for its Airbus A330s.
The rapid development
of MRO
capabilities in the
Middle East has
also opened up opportunities
for outsourced
support
services by companies
offering more
specialized repairs.
According to Andrew Walmsley, VP sales
and marketing for Miami-based Jet Aviation
Specialists, “the high cost of set-up for such
repairs requires new engine facilities to have
substantial volumes of shop visits to justify the
investment. Our specialization in combustor
repairs has provided us with significant opportunities
for new customers”.
“Not every airline in the region
builds up its own Mro capabilities.
New competitors will get their share
of the market in the future - and so
will we, but we don’t underestimate
the build-up of regional competition.”
Walter Heerdt, Lufthansa Technik
In fact, most Middle Eastern operators currently
elect to subcontract their component maintenance
services through ‘power-by-the-hour’
(PBH) programs, which include pool access,
repair management and leased main base kit
solutions, according to Gulperi Kurdoglu, CEO
of Turkish MRO Airlogic.
Component repair and management is an area
of considerable potential, he believes, as there
are relatively few component maintenance
shops in the region and those MROs that do
have component repair facilities offer somewhat
limited capabilities. Airlogic has stepped
in with what it calls the ‘next logical evolution
of the PBH concept, by which it offers on-site
solutions with teams and warehouses located
‘within minutes of line maintenance operations,
permitting door-to-door service and little or no
logistics follow-up burden to the airlines’.
The Middle East is not without its complications,
as we’ve all seen in recent weeks. Political
turmoil and instability across the region
are causes for concern for companies looking
to do business here, but the unrest, although
widespread, is presently limited to a handful of
countries. And, after spiking to worrying levels,
the price of oil has stabilized, prompting
Emirates, for one, to drop its fuel surcharges,
and giving hope to the MRO sector worldwide
that their Q2 balance sheets will benefit.
Gulf Technics’ Elnenaey summed up prospects
for the region, suggesting that once the dust
settles, the region will become a ‘gravity field
to investors’, which should open the door to
increased development from within and further
partnerships from abroad.
AviTrader MRO - May 2011

Aviation Aftermarket
A CFO‘s worst nightmare . . .
...Surplus stock
THE RECENT SPATE OF better-than-expected
profits released by aerospace
companies, from Boeing to Goodrich to Safran
and beyond, in the first quarter of 2011
came as a pleasant surprise to an industry
only just emerging from a crippling
recession to find its recovery threatened
by sky-high oil prices. It’s clear,
then, that someone’s been doing
their job right and has been spot on
with the numbers.
That person, more often than not, is
the man, or woman, with their finger
on the pulse of the company purse,
the chief financial officer, whose job it
is to keep close rein on spending and
provide the best possible return to the
firm’s stakeholders - a tough job in a
conservative and regulation-bound industry
that has among the lowest margins
of possibly any business outside
the charity sector, if you take the word
of IATA president Giovanni Bisignani.
What’s a CFO’s biggest bête noire
these days? Across the board, the
answer came back the same: they’re
haunted by the thought of surplus
stock, and the cash flow nightmares that
follow.
So how does a company get into the vicious
circle of buying in stock only to fund it’s got
too much? And more importantly, what can
it do once it finds itself in this predicament?
Airlines and MROs need to stock a lot of
inventory to reduce the risk of AOGs, to
ensure parts are available to achieve the
“Depreciation in fair market value for surplus
happens when fleet types age and the aftermarket
becomes saturated with spares for sale.”
Claes Malmros, VAS Aero Services
best TATs and to reduce the number of
‘deferred defects’ on aircraft. But oversupply
can happen, according to Claes
Malmros, managing director of aftermarket
distributor VAS Aero Services, through
‘over-provisioning, over-production, aircraft
retirements, aircraft and fleet utilization re-
ductions, material pooling programs and
company mergers and acquisitions”.
Airlines used to purchase more ‘to be safe,
when cash was not an issue’. explains Mike
Cazaz, president of Werner Aero Services.
“They can also end up with too much stock
when they purchase or lease an aircraft and
the OEM provides them with parts or requires
them to buy parts in order to make
the deal - and the airline realizes it has
much more than it needs”.
“Components are a long-term investment
that do not get consumed, and so they accumulate
- even when an organisation is buying
effectively,” adds John
Avery, director of supply
chain services at
AJ Walter Aviation.
“As a fleet changes,
that problem is made
worse. Add to this an
AOG situation, when a part is needed in a
hurry, and the quickest solution is thought to
be buying one; then you have a part you may
never need again.”
On top of this, continues Avery, it should be
recognized that managing an aircraft stock is
complex, with a lot of the procurement hap-
13
pening during Initial Procurement, when an
operator may have little knowledge of a new
fleet coming into service - meaing that ‘less
than optimal’ decisions can be made’.
If surplus is not eliminated fast and permanently
(generating cash in the process),
inventory levels will increase as
new parts, purchased to support new
equipment, are added - and this can
be devastating to a company’s books.
The first impact, which occurs over
time, according to Malmros, is the
depreciation in fair market value
for surplus, which happens when
fleet types age and the aftermarket
becomes saturated with spares for
sale. Companies can be forced into
internal write-downs/offs, as parts
become obsolete, filling up warehouses
and requiring extra administrative
resources.
The worst case scenario, says Avery,
is that the operator ends up with
no money left to spend (often in a
down-turning market), too much of
some parts and not enough of others.
“They’ll then find no market to
sell their surplus, or they can only sell below
book value and take a substantial loss - big
enough to put the airline accounts firmly into
the red. Operating costs will also be high,
as they won’t have the parts they need, so
will buy in on an ad hoc basis with expensive
loans; again, very bad news in a downturn.”
The most obvious way to avoid a surplus
stock situation, one airline CFO told AviTrader
MRO, is to not own any in the first place.
“Not owning inventory eliminates the risk,”
he said.”This is increasingly done by having
arrangements with OEMs and integrators to
provide the required inventory on a consignment
‘pay-as-you-use’ basis”.
That same school of thought also applies to
disposing of the surplus, which can be sold
part by part or in packages to surplus dealers
or through consignment agreements.
A recent example of such practice is the fouryear
exclusive deal between AeroTurbine in
Miami and American Airlines, whereby the
AviTrader MRO - May 2011

Aviation Aftermarket
integrator won exclusive rights to purchase
material deemed surplus by the carrier to remarket
globally. The two companies jointly
run a warehouse in Oklahoma to prepare
“operators must look beyond investing in
inefficient standalone stock by pursuing a
limited capital investment in a small stock
of critical parts combined with access to a
component pool, which is both efficient
and cost-effective.” John Avery, AJ Walter Aviation
material for remarketing, with AeroTurbine
committing staff to the venture to further reduce
American’s inventory levels.
Avery adds that operators must look beyond
investing in “inefficient standalone stock
by pursuing a limited capital investment
in a small stock of critical parts combined
with access to a component pool - which
is both efficient and cost-effective. And as
a bonus, when it comes time to dispose of
the small stock of critical parts, the operator
will have a very good chance of achieving
a good price as really critical parts tend
to hold their value much better.”
And for suppliers, knowledge and planning
are the two key weapons to keep surplus
at bay, according to Cazaz. “By planning
right, timing your expected
spares and your customers’
scheduled maintenance,
you reduce your exposure.
Operational knowledge ensures
that you do not buy
spares that you don’t need,
or those you want to keep
‘just in case”.
The need to keep a tight ship will become
even more pressing in the future as new
aircraft and engines are intro-
duced. Technology will only
exacerbate the problem for
CFOs: components are becoming
increasingly reliable
and ever more expensive.
“We passed the point of the
$1 million black box some
time ago,” said Avery. “We’re told that the
maintenance cost of the 787 is lower than
that for the 767, as you’d expect, but the
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14
savings are all in the aircraft maintenance
costs. In fact, the cost of component support
has actually increased.”
That’s likely to lead to the OEMs locking up
more customers with support programs,
limiting the scope for independent suppliers
and integrators. But as we all know, new
models can take their time coming to market,
meaning the many thousands of ‘old’
models will remain as the backbone of the
industry for years to come.
New models may be more reliable and efficient,
but they still need to replace components
just like older models, says Cazaz. “Efficient
inventory management still depends
“New models may be more reliable and
efficient, but they still need to replace
components just like older models.”
Mike Cazaz, Werner Aero Services
on planning and knowledge - and these
new planes and engines get older as well.
Basically, life goes in cycles.”

ibA Analysis - the Middle east Mro sector
Maintenance Middle East style
The Middle East MRO sector has a lot going for it, from climate to capacity,
and an appetite for partnerships, discovers the IBA Group’s Ben Jacques
MiDDle eAsterN Mros Are a wily
bunch. Taking into account the industry’s
current woes, they seem to be sitting fairly
pretty as their predatory instincts leave them
prowling the horizon of tomorrow with the big
sharp claws of low operating cost, government
support/political will, convenient location and
enormous local fleet backlog.
The core client base of these Middle Eastern
MROs is local airlines, but they are increasingly
appealing to carriers from further afield, including
both Western European military and low
cost carriers. This obviously
has not happened overnight
and I expect some people are
only now waking up to these
facts with a level of trepidation,
as the aviation world
appears to take another step eastward away
from the traditional geographic mainstays.
The Middle East as a whole is slowly becoming all
things to all people, driving business and leisure
travel either to it, or through it, on an increasingly
regular basis. It is this mainstream travel
which is supporting the fleet expansion plans
of airlines based in the Middle East. These fleets
are, in fact, set to double in size, well before we
are all in Qatar for the 2022 FIFA World Cup.
These airlines and their increasing fleet are providing
the bread-and-butter work to the MROs
in the Middle East. However, as I mentioned earlier,
the client base is not just made up of local
airlines, as the region is within reasonable ferry
time of airports served by more than one third
of the entire world’s commercial fleet. In fact,
it is interesting to note that nearly two billion
people live within four hours flying time of the
Gulf and twice as many within seven hours.
If we investigate the appeal of the Middle East
MROs, without scratching too far below the
surface, it is quickly revealed to be low operating
costs and fast turnaround times which go
a long way to assisting the sales teams of the
Middle East MROs in attracting new business. If
you imagine the concentric circles of an aircraft
range diagram, those same circles represent a
the Middle east as a whole is slowly becoming all things
to all people, driving business and leisure travel either
to it, or through it, on an increasingly regular basis.
potential client base for an MRO, with the circles
expanding toward a greater reach as costs
are brought down and deadlines are shortened,
without impinging upon the ability to meet crucial
turnaround deadlines.
The low operating costs for these MROs are
possible because of abundant space available at
a reasonable land rent, allowing for good volume
and economies of scale. The Middle East
MROs also enjoy cheap labour rates compared
to their Western European and North American
legacy MRO counterparts. These cheaper labour
rates should mean that the longer the duration
of a check or maintenance work, the more significant
cost savings become.
The topic of labour and the available skill sets
15
brings us to an interesting
issue for the
Middle East and MROs
as a whole. Currently
the skill set is quite
dependent on non-local
staff and it is debatable
how sustainable
this is. A serious
problem to the current
model is that the IBA’s Ben Jacques
guest workers themselves
are those gentlemen (and ladies) who
enjoyed apprenticeship schemes
in the last ten to twenty, ‘ahem’
sorry, thirty, years. These apprentice
schemes are not available in
the same volumes anymore and
those that are still available are
with companies like Lufthansa Technik who
are very keen to hang on to the talented apprentices
who they have invested in.
Over the next few years there is likely to be much
discussion about the 2020-and-onward skills
shortage of engineers (and pilots). This is a global
problem and not something which is just going
to affect the Middle East, but the region may
take a unique approach to thwart this problem.
There are likely to be some mildly excited teenagers
over the next decade who will sit down on
careers day with a nice person from a Middle East
recruitment firm who promises a nice apprenticeship,
all the sun they could want and very likely
a tax-free job for life with good prospects. Quite
different to the careers day I had to endure.
Quality work and lower prices: Base maintenance underway in Egyptair’s Hangar 8000 in Cairo EgyptAir
AviTrader MRO - May 2011

ibA Analysis - the Middle east Mro sector
Apprenticeships were the mainstay of many airline
engineering departments of yesteryear and
in fact, many of the MROs in the region may
have begun life as an airline’s maintenance arm.
Several have since devolved to become standalone
third party MROs and ADAT (Abu Dhabi
Aircraft Technologies) is perhaps the largest and
most successful of these. This is not to say that
all investment in maintenance is supporting
third party maintenance firms; FlyDubai has just
taken a huge amount of maintenance in-house,
at a cost of $20 million of investment, showing
that Middle East MROs are still having to compete
for local business.
Regarding new MRO investment and the fight
for business, any start-up MRO will need to
have airline support fairly early on in its trading.
An example of a new third party start-up is
the Gulf Technics venture, which will be taking
on much of the work on the Gulf Air fleet and
will be a new venture in terms of third party
MROs entering Bahrain.
Clearly, MRO growth in general is directly linked
to a growing need for the services the sector offers.
The growing fleet in the Middle East will
certainly contribute to the expected growth in
Middle Eastern MRO’s and, whilst the global
fleet will also grow over the same period, it is not
expected to grow at anywhere near the same
rate. To illustrate this correlation, I have included
some simple charts to the right, showing global
Base Check expenditure, actual and forecast, up
to 2018. This data is based on estimates and assumptions
such as expected average utilisations,
current intervals and today’s order book.
So, we predict in general an upward trend
in Base Check expenditure, which is likely to
translate into increased MRO expenditure, although
it can equally be expected that some
MROs will be more successful than others at
securing this new business.
So far, I have focused on commercial aviation
and although that is relevant to most of you,
4,000
3,500
3,000
2,500
2,000
1,500
1,000
2,000
1,800
1,600
1,400
1,200
1,000
something which works well in the region, and
is likely to increase in the next decade, is oeM
partnerships, particularly as there is so much
new equipment in the Middle east.
some might well be pondering the benefits of
private aircraft maintenance.
Most of the BBJs and ACJ aircraft could be
maintained at a pinch by an MRO used to normal
A320 family or B737 family aircraft; however,
BBJs are soon to be well covered in the
Middle East as Royal Jet open its maintenance
capabilities near to their Abu Dhabi FBO.
As one delves into the non airliner derived aircraft
it becomes a more specialist task. Companies like
Execujet specialise in Bombardier equipment and
500
0
800
600
400
200
0
Narrowbody Airframe Base Check Expenditure
(US$ Millions)
2010 2011 2012 2013 2014 2015 2016 2017 2018
Widebody Airframe Base Check Expenditure
(US$ Millions)
2010 2011 2012 2013 2014 2015 2016 2017 2018
have a sizeable Middle East operation based out
of Dubai. Falcon Aviation Services and Jet Aviation
are other examples of companies able to
offer maintenance services to corporate jets in
the Middle East.
As a whole, private jet aircraft are not as well
catered for in the Middle East yet, but this
is very likely to do with
the different ownership
culture behind private
aircraft and their different
maintenance cycles,
which are not often driven
by the same requirements
as commercial airliners, so the business requirements
are equally different.
Something which does work very well in the
Middle East, and is likely to only increase in the
next decade, is OEM partnerships, particularly
as there is so much new equipment in the region.
These partnerships signify an increase
in maturity of the Middle East MRO market as
high level customer service, which traditionally
comes at premium, begins to penetrate the
competitive market place as a USP for some
B737‐900/ER
B737‐800
B737‐700
B737‐600
NB: Accurate Check costs are scarce for the A380, 787 and A350 so IBA has not included this data in the above graph.
A321
A320
A319
A318
B777‐300ER
B777‐300
B777‐200LRF
B777‐200LR
B777‐200ER
B777‐200
B767‐300ER
B747‐400/‐8
A340
A330
16
MROs who are able to offer unique services,
some OEM-led and some not.
This appears to be the future over the next five
years for the Middle East MROs, as the current
standalone entities evolve toward closer working
strategic partnerships delivering cost effective
supply chain maintenance, repair and
overhaul to the airlines, utilising the region’s
capabilities. Something I haven’t touched on,
but it is an enticing Middle East MRO prospect
would be the capacity for further utilising the
Middle East’s space and dry climate for parking,
tear down and recycling. None of these are too
far from the core capabilities of many MROs
in the region, and I suspect this will form the
centre of discussion very soon.
The International
Bureau of Aviation is an
independent aviation
consulting firm based in Leatherhead,
UK, with representation worldwide
AviTrader MRO - May 2011

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selected it News / News in brief
Instrument Tech selects Component Control’s Quantum software
Component Control announced that Instrument Tech, an aviation instrument and avionics
manufacturer and repair service provider, has selected Component Control’s Quantum Control
MRO and Logistics Software Solution to replace its existing MRO solution for better integration
and control of their business and operations processes. Instrument Tech cited comprehensive
accounting integration, integrated access to StockMarket.aero’s online supply chain hub, and
exceptional customer service as reasons for the company-wide solution replacement.
Lufthansa Technik uses ANSYS to
simulate wear and tear
Lufthansa Technik AG is leveraging simulation
software from ANSYS to simulate wear and
tear of aircraft components, to prolong service
intervals and to create new ways to repair used
parts. Lufthansa Technik performs its own
research to investigate blade damage due to
bird strike and gradual erosion resulting from
particles in the air.
News in brief
Brazilian Air Force signs OnPoint solution
agreement for CF34 engine fleet
The Brazilian Air Force signed a five-year
OnPointSM solution agreement with GE
Aviation covering MRO services of their CF34-
10E engines that power its EMBRAER 190
fleet. The work will be performed at the GE
Celma facility in Petropolis, Brazil, which is
building up the full overhaul capability for the
CF34-10 engines.
Lufthansa Technik and Fokker Services
sign five year deals on components
Fokker Services and Lufthansa Technik signed
several agreements for the support on
AMOS goes live on Alitalia
Alitalia went successfully live with
M&E system AMOS, put into operation
enterprise-wide via a “Big Bang” approach
- meaning that all software modules went
simultaneously live. The AMOS is a fully
integrated maintenance management system
developed and distributed by Swiss Aviation
Software (SwissA), a 100% subsidiary of
Swiss International Air Lines.
Boeing, Airbus and Bombardier components.
The agreements signed are valid for five
years. Both companies are specialized in the
support of Boeing, Airbus and Bombardier
aircraft components. The agreement includes
the support on a wide range of pneumatic,
hydraulics and avionics components. The
work will be carried out by Fokker Aerotron
(USA), Fokker Airinc (USA) and Fokker
Services in Amsterdam.
TASS Asia Pacific is granted CAANZ
Design Organization Approval
TASS Asia Pacific was granted CAANZ Design
Organization Approval under Part 146 of Civil
Aviation Rules of New Zealand. “We are very
18
Commsoft announces two new deals
for OASES software, with Scottish
airline Loganair . . . .
Commsoft announced that Scottish airline
Loganair has gone fully live with a new
OASES Line Maintenance Control module.
The OASES LMC module is linked with the
Sabre Rocade operations system at Loganair,
which provides timely and accurate
data, facilitating short term maintenance
forecasting and complete line maintenance
management across Loganair’s extensive
network of line stations.
. . .and Latvian carrier SmartLynx
Airlines
Communications Software (Commsoft)
released that SmartLynx Airlines signed up
to its Open Aviation Strategic Engineering
System (OASES) MRO software system to
support its charter and ACMI operations.
SmartLynx signed up to OASES for 5 years
on a 15-concurrent user deal to manage
its eight Airbus A320s, which operate
worldwide in a range of locations and with
various third party customers. Commsoft
has agreed to a rapid implementation of
OASES, with the system aiming to go live by
30th May 2011.
Volartec’s Alkym selected by Avion
Express
Volartec announced the selection of its
Alkym Control and Management System
for Aircraft Maintenance by Lithuanianbased
Avion Express, which added a new
A320 to its fleet this year. Avion have opted
for a 10-concurrent user licence utilising
eight modules from the available 15.
pleased to announce this critical milestone
for TASS Asia Pacific”, says Andrew Freese,
Managing Director. Operators, Lessors, and
MRO’s in New Zealand, that require Part 146
compliance for modifications and repairs
will have access to a comprehensive suite
of engineering services provided by TASS
Globally. Our clients can also access our global
services for AOG and repairs, 24/7, including
FAA, EASA and CASA approvals.
Avtrade announce Consigned Inventory
Management deal with easyJet
Avtrade further expands its relationship and
collaboration with European low-cost airline
easyJet. Complementing its own extensive
AviTrader MRO - May 2011

News in brief
inventory portfolio, Avtrade will globally
market, trade and manage a selection of
easyJet A320 consigned inventory.
Latecoere Aero Services awarded conversion
passenger to freighter of two
ATR 72
Deccan 360 awarded Latecoere Aero Services
in Toulouse Blagnac, France, the contract for
two ATR72 Passenger to freight conversions.
Latecoere Aero Services is an independent
Part 145 organisation with facilities at both
Toulouse and Montpellier Airports, it also has
a paint shop in Montpellier, which has the
capability for ATR, Boeing 737 and Airbus
A320 family maintenance.
Aveos wins inventory support contract
from Air Transat
Aveos concluded a seven-year contract
to provide full inventory and repair and
overhaul support to Air Transat for its fleet of
11 Airbus A330 aircraft. Aveos will provide
an advanced inventory exchange program,
with a guaranteed service and quality level
for more than 1,000 part numbers on the Air
Transat fleet.
JETS expands with new paint facility
at UK headquarters
Jet Engineering Technical Support (JETS),
the Challenger, Hawker and Dornier aircraft
maintenance centre based in Bournemouth,
UK, is expanding its facility with the opening
of a new dedicated paint bay. The introduction
of the new paint area will enable JETS to offer
a one-stop-shop capability to customers, who
will be able to schedule aircraft painting work
as part of the routine maintenance input.
TAM AE named Authorized Service
Center for GE M601 and H80 engines
TAM Aviação Executiva (TAM AE), an executive
aviation company in the Brazilian sales and
aircraft maintenance markets, signed an
agreement with GE Aviation to become an
Authorized Service Center for GE’s M601
and H80 turboprop engines. As part of the
agreement, TAM AE will offer comprehensive
line maintenance, removals and re-installations
of engines and line-replaceable units (LRUs) and
engine spares for the M601 and H80 engine
families. As part of the deal, GE Aviation will
provide TAM AE with comprehensive material
support and training.
Ajeton inks joint venture with Global
Jet Dubai
Ajeton, a certified FAA repair station at Los
Angeles International Airport, entered into a joint
venture with Global Jet Airlines of Dubai. The
joint venture is to establish a new Repair Station
at Dubai International Airport, expected to be
certified by FAA and EASA. The new venture, to
be called “Ajeton DXB”, will provide maintenance
and engineering support for international airlines
with service in Dubai, UAE.
Jet Aviation triples hangar space in
Singapore
Jet Aviation is preparing to begin construction
of a new 6,100m² maintenance hangar
next to its current maintenance and FBO
operation in Singapore this fall. The hangar
will provide direct access to the tarmac, while
the additional hangar space permits up to 5
narrow-body or 6 ultra long-range aircraft.
The new Singapore hangar is set to be
operational in January 2013.
TIMCO rebrands Brice Seating
TIMCO Aviation Services released that Brice
Seating (Brice) is being rebranded as a product
unit of TIMCO Aerosystems, TIMCO’s interiors
engineering and manufacturing group. The
move is being made to more clearly convey
the full breadth of interiors capabilities and
products provided by TIMCO Aerosystems. Brice
has operated as a part of the TIMCO family of
companies since it was acquired in 2002.
selecteD trANsActioNs
Safran announces creation of Messier-Bugatti-Dowty
19
Precision Conversions wins EASA
approval for Maximum Zero Fuel
Weight increase STC on all 757-
200PCFs
Precision Conversions and Leth & Associates
released that the European Aviation Safety
Agency (EASA) approved the Federal
Aviation Administration Supplemental Type
Certificate (STO1857SE) for a Maximum
Zero Fuel Weight (MZFW) increase on the
Precision Conversions 757-200PCF freighter.
The MZFW STC allows for up to an additional
8,000 lbs (3,628 kg) payload increase for both
Rolls-Royce and Pratt & Whitney powered
757-200PCFs above line number 210 and
also allows for up to an additional 4,000 lbs
(1,814 kg) payload increase for both Rolls-
Royce and Pratt & Whitney powered 757-
200PCFs below line number 210.
SR Technics and Garuda Indonesia
strengthen relationship
SR Technics and Garuda Indonesia
strengthened their partnership with a fiveyear
Integrated Component Solutions (ICS)
contract for Garuda’s fleet of Boeing 737NGs.
The $36 million agreement, which is covering
43 aircraft, runs through to March 31, 2016.
It includes a starting inventory of 455 part
Safran announced the merger of subsidiaries Messier-Bugatti, Messier-Dowty and Messier
Services to form Messier-Bugatti-Dowty, a leader in aircraft landing and braking systems.
The new company will be headed by Alain Sauret, the current chairman and CEO of Messier-
Bugatti. Gilles Bouctot, the current CEO of Messier-Dowty, will be chief operating officer. The
new organisation comprises four operational divisions: Landing Gear and Systems Integration,
Wheels and Brakes, Systems Equipment and Maintenance, Repair and Overhaul.
Worthington Aviation announces new Middle East facility
Worthington Aviation announced that it has opened a new Middle East facility. Based in
Ras Al Khaimah, UAE, Worthington’s new regional support center will feature a broad and
comprehensive line of products including rotables, engines, avionics, landing gear and
expendables. In addition, the facility will also offer a wide array of programs and services
to maintain fleet operations, including tailored Customized Parts Programs, Exchange
Programs, Material Sales, Consignment, Logistic Services and Leasing/Rentals.
CIRCOR Aerospace completes creation of CIRCOR France
CIRCOR Aerospace, a CIRCOR International company, completed the creation of CIRCOR
France to support European growth strategies. CIRCOR France (formerly Industria, S.A.S.),
based in Le Plessis Trevise near Paris, will function as a holding company for European and
North African business activities.
AVIC confirms US purchase
China’s AVIC International Holding Corporation announced the completion of its takeover
of Teledyne Continental Motors, a top US developer and supplier of aircraft piston engines,
parts and components, and sister company Teledyne Mattituck Services from parent company
Teledyne Technologies. The purchase is the first by a Chinese aviation company of a US aviation
manufacturing firm and comes as China’s aviation market is poised for rapid expansion.
AviTrader MRO - May 2011

News in brief
selecteD lessor NeWs
ALC IPO raises $868 million in commercial aviation leasing sector’s largest IPO
Air Lease Corporation (ALC) sold 34.8 million shares on the New York Stock Exchange in an
IPO that raised $868 million - the commercial aviation sector‘s largest-ever IPO. Company
founder Steven Udavr-Hazy said the listing ‘re-establishes the credibility of the leasing model
as an imortant facet of airlines’ fleet financing’. At the time of the IPO, ALC had a fleet of
49 aircraft, with orders for a further 153.
ILFC upsizes secured-term loan for $1 .5 billion commitment
International Lease Finance Corporation (ILFC), a wholly owned subsidiary of American International
Group, announced that it has successfully upsized its recently announced secured term
loan for a total commitment of $1.5 billion. ILFC initially received $1.3 billion in commitments
last month from a group of 15 banks from Europe, Asia and North America. With the addition
of KfW IPEX-Bank GmbH, the company increased the total commitment to $1.5 billion.
numbers in Zurich. The contract also includes
an SR Technics-owned home-base stock of
inventory in Jakarta, which Garuda will utilize
on a lease basis.
BELAC reaches milestone of 50,000
HPT engine blades shipped
Chromalloy announced that its joint venture
company, BELAC LLC, reached a significant
milestone – 50,000 Parts Manufacturer
Approval (PMA) High Pressure Turbine blades
shipped to commercial and military operators.
The company’s 50,000th blade was shipped to
a global airline based in Europe.
Vision Airlines selects AMES for B767
and B737 maintenance
Airborne Maintenance & Engineering Services
(AMES), a subsidiary of Air Transport Services
Group, announced additional contracts with
Vision Airlines for support of Vision’s Boeing
767 and Boeing 737 aircraft.
FL Technics JETS receives EASA Part-
145 certification
FL Technics JETS received EASA Part-145
certification, allowing the company to provide
MRO services for the Hawker Beechcraft
700/750/800/800XP/850XP/900XP aircraft
family. The company launched a new
business aviation services centre at Vilnius
International airport.
STS Component Solutions forms partnership
with Otto Instrument Service
STS Component Solutions formed a new
partnership with Otto Instrument Service.
STSCS has been appointed as an authorized
distributor for Otto Instrument Service with
facilities in Ontario and Sun Valley, California.
STSCS will provide worldwide aviation support
for FAA-PMA engine wire harnesses, repair
services and DER services/support.
Lufthansa Technik supports Sky Regional
Airlines
Sky Regional Airlines entrusts their component
supply for the next ten years to Lufthansa Technik.
The companies signed a Total Component
Support TCS agreement for the fleet of five
Q400 aircraft. The start-up carrier is Lufthansa
Technik’s first Q400-customer in North America.
A gooD MoNth for AJ WAlter AviAtioN
Global Jet signs GTA with A J Walter Aviation
20
Lufthansa Technik has installed a home base pool
in Montreal. More than 110 Line Replaceable
Units (LRU) - ranging from hydraulic pumps up
to generators - will be in storage for a smooth
operation. The components will be overhauled
at Lufthansa Technik sites in Sun Valley, USA
and Hamburg, Germany.
Corsairfly extends A330 component
contract with AFI KLM E&M
Corsairfly, a subsidiary of TUI TRAVEL group,
extended its A330 Component support
contract with AFI KLM E&M. Corsairfly
operates a fleet of six Boeing 747-400s and
two Airbus A330-200s.
Air New Zealand and Hamilton Sundstrand
to establish repair capability
for APS3200
Air New Zealand and Hamilton Sundstrand
Corporation agreed to establish repair capability
for the APS3200 Auxiliary Power Unit (APU) in
the Christchurch MRO facility in New Zealand
under an authorized repair facility agreement
with Hamilton Sundstrand. Last year, Air New
A J Walter Aviation was entrusted to provide Global Jet FZCO with a wide range of
integrated aircraft support services. In a three year agreement, AJW will be working
closely with Global Jet to develop an exclusive airside facility in the Dubai Free Zone
which will comprise support for consumables and rotables as well as complete engine
management for current and future fleets.
Turkish Technic and A J Walter Aviation sign five-year cooperation deal
Turkish Technic announced that it has selected spares support specialist A J Walter Aviation
to provide full PBH and leased stock services to the growing Turkish Airlines B777-300ER
aircraft fleet. The contract is initially for a total of 12 aircraft in-service and on order from
Boeing, and AJW has teamed with its partner BA Engineering to underpin the AJW inventory
support solution for this fleet.
A J Walter Aviation launches global Corporate Aircraft Spares Support service
A J Walter Aviation is partnering with Loudoun Aviation, the internationally recognized
business jet dealer based near Washington DC, to deliver spares support excellence to the
corporate sector. Offering a range of 24/7 AOG, power-by-the-hour, pooling and daily
service options, AJW is able to support corporate operators of ACJ and BBJ aircraft, as well
as all Boeing corporate conversions. Combined, AJW and Loudoun offer almost a century
of valuable experience to provide specialist world class services to owners and operators of
larger cabin long range business jets tailored to their unique flight profiles.
VivaAerobus chooses A J Walter to provide component PBH support
Mexican-based low-cost airline VivaAerobus, established in association with Irelandia, a
global investor and developer of low-cost airlines and managed by the founders of Ryanair,
chose A J Walter Aviation to provide component power-by-the-hour support for its current
fleet of fifteen B737-300 aircraft. VivaAerobus is a low fares carrier with plans to rapidly
grow its fleet to at least thirty aircraft by 2013. The airline currently flies 58 national and 2
international routes, including destinations such as Las Vegas and Houston.

News in brief
selecteD fiNANciAl NeWs
Boeing reports stronger-thanexpected
first quarter profits
Boeing reported first-quarter profits of $586
million, earning 78 cents per share, up
from an expected 70 cents per share. The
figure topped last year’s $519 million, but
revenues were down 2% to $14.91 billion,
with revenues for the commercial unit down
5% to $7.12 billion and defense revenues
flat at $7.62 billion. Orders for the quarter
were $23 billion, adding to a total company
backlog at quarter-end of $329 billion, up
from $321 billion at year-end.
EADS reports first quarter 2011 net
loss of €12 million
In the first quarter, EADS’ revenues increased
10% to €9.9 billion (Q1 2010: EUR 9.0
billion). Deliveries remained at a high level
with 119 aircraft at Airbus Commercial,
81 helicopters at Eurocopter and the 42nd
consecutive successful Ariane 5 launch.
Airbus Military recorded revenues for the
A400M programme of €165 million, based
on milestones. EBIT before one-off (adjusted
EBIT) stood at around €230 million (Q1
2010: around €150 million) for EADS and at
around €160 million for Airbus (Q1 2010:
around €80 million). Net loss amounted to
€-12 million (Q1 2010: €103 million). The
finance result amounts to € -197 million
(Q1 2010: €77 million). The interest result
of € -47 million is roughly stable with the
2010 level (Q1 2010: € -53 million).
Embraer posts net income of $105 .1
million for first quarter 2011
Embraer reported a rise in first quarter
revenues to $1,055.7 million compared
to $992 million last year. The contribution
of aviation services to the company’s total
revenue was 15.4%, above the 2010
contribution of approximately 11%. EBIT
and EBIT margin were $94.3 million and
8.9%, respectively. Operating income
margin was higher than the 7.2% margin
achieved in 2010. The net margin reached
10%, and was significantly higher when
compared to the 2.4% achieved last year.
Goodrich reports first quarter 2011
net income of $195 million
Goodrich reported first quarter 2011
net income of $195 million, on sales of
$1,896 million. In the first quarter 2010,
the company reported net income of
$111 million on sales of $1,695 million.
Continued on p. 22
Zealand selected the Hamilton Sundstrand
Power Systems APS3200 APU for its new fleet
of 14 Airbus A320 aircraft.
SR Technics secures first contract in the
Philippines with Cebu Pacific
SR Technics secured its first long-term contract
in the Philippines; a 10-year agreement with
Cebu Pacific. The $52 million accord is to
provide exclusive maintenance services for 18
CFM56-5B engines on the airline’s Airbus A320
fleet. SR Technics will carry out the services at
its Engine Shop facility in Zurich. As part of the
contract SR Technics will provide door-to-door
turnaround time and has offered guaranteed
savings to Cebu, through a sophisticated
material management system.
Embraer and AVIC sign framework
agreement on industrial cooperation
Embraer signed a framework agreement with
AVIC (Aviation Industry Corporation of China)
to implement a Legacy 600/650 production
line in China, using the infrastructure, financial
resources and workforce of their joint venture
company Harbin Embraer Aircraft Industry
Company (HEAI).
Héroux-Devtek to build Querétaro
manufacturing facility
Héroux-Devtek announced the construction of
a new manufacturing facility in the Querétaro
Aerospace Park in Mexico for the production
of aerostructure components. Construction
is set to begin during the second quarter of
calendar year 2011, and the facility should be
ready to produce its first components early in
calendar year 2012.
Boeing expands landing gear solutions
capability and offerings
Boeing expanded its Landing Gear Overhaul
and Exchange Program to cover the 777-200LR
(Longer Range), 777 Freighter and 777-300ER
(Extended Range) airplanes to provide more
customers with greater service for landing gear
support. Boeing’s Material Services currently
provides landing gear overhaul and exchange
solutions to more than 75 customers on the
MD-11, 717, Next-Generation 737, Boeing
Business Jet, 747-400ER, 757-300, 767-300ER
and the 777-200ER airframes.
AFI KLM E&M signs contracts with
Alitalia and Sunwing
Alitalia is now one of AFI KLM E&M’s biggest
GE 90 customers. The engine contract includes
support services with access to the spare engines
pool and engine shop visits on a Time & Material
basis. The component flight-hour support
contract is provided by AFI KLM E&M and Boeing
21
under their 777 Component Services Program
(CSP) partnership. Sunwing renewed its 737-
800 component support contract with AFI
KLM E&M for a further six years.
Fokker Services’ FLYFokker program
embraced by OceanAir
OceanAir Linhas Aereas S.A and Fokker Services
agreed to a FLYFokker Take Care Flight Hour
agreement for the rotable component and
technical support of their 14 Fokker 100 aircraft.
P&W launches PureSolution services for
PurePower engine family
Pratt & Whitney reported the launch of
PureSolution services, the company’s new
flexible maintenance plan designed exclusively
for its PurePower engine family. PureSolution
services offer MRO expertise from the PurePower
engine’s OEM creator and design-responsible
partners. It will be delivered by Pratt & Whitney’s
service network, as well as new network
partners serving as centers of excellence.
Messier-Dowty delivers first set of
Airbus A350-900 main landing gears
Messier-Dowty, a Safran group company,
delivered the first set of the new Airbus A350-
900 main landing gears, completing a significant
milestone in the new aircraft program. This first
set of gears has been delivered to the Airbus
Filton plant for installation in the A350 XWB
landing gear systems test rig.
Bombardier offers CRJ aircraft repair capability
in Dallas, Texas
Bombardier Customer Services is offering repair
capability for Bombardier’s CRJ200, CRJ700
and CRJ900 commercial aircraft at its Dallas
repair facility. Following further investment in
its repair and overhaul centre, located southwest
of Love Field Airport in Dallas, Bombardier
can now provide CRJ aircraft repair capabilities
for both nacelle and flight control components.
The significant investment includes a large,
rotable pool of parts.
Skynet Asia Airways selects Goodrich’s
carbon brakes for Boeing 737NGs
Goodrich Corporation was selected by Skynet
Asia Airways to supply wheels and carbon
brakes for its new fleet of 13 Boeing 737-800
Next Generation aircraft. Aircraft deliveries
with the Goodrich wheel and carbon brake
equipment are expected to begin in June 2011
and continue through 2016. Goodrich’s 737
Next Generation carbon brake uses proprietary
DURACARB® carbon heat sink material, which
provide exceptional brake performance and
significant weight savings.
AviTrader MRO - May 2011

News in brief
Continued from p. 21
Sales are now expected to be about $7.8
billion, compared to the prior outlook of
$7.7 - $7.8 billion. The outlook for net
cash provided by operating activities, minus
capital expenditures, is unchanged and is
expected to exceed 85% of net income.
MTU Aero Engines shows strong
operating performance in first
quarter
MTU Aero Engines Holding AG improved
its revenues in the first quarter 2011 by
4 % to €664.8 million (1-3/2010: €640.2
million). The company’s operating profit
rose by 17 % to €80.5 million, compared
with €68.8 million in the same quarter
of the previous year. This brought the
operating margin up to 12.1 % compared
with 10.7 % in the first three months
of 2010. At €40.4 million, net income
remained stable (1-3/2010: €40.1 million).
MTU’s revenues in the commercial engine
business increased by 17 % to €309.6
million (1-3/2010: €265.3 million), despite
the delay in revenues from its series
production business.
SIAEC Group post full year 2010-11
results
The SIAEC Group’s profit attributable to
owners of the parent was $258.5 million
for FY2010-11, an increase of 9.5% over
the previous financial year. Operating
profit grew by 22.9% to $135.7 million
on the back of stronger revenue. Revenue
of $1,106.9 million was $100.5 million or
10.0% higher than the last financial year,
with the growth coming from airframe and
component overhaul, fleet management
programme and Line Maintenance.
Expenditure rose by $75.2 million or 8.4%
to $971.2 million.
Spirit AeroSystems profits down
to $35 million from $56 million in
2010
Spirit’s first quarter 2011 revenues were
$1.050 billion, slightly up from $1.043
billion for the same period of 2010
primarily driven by model mix. Operating
income was $70 million, compared to $93
million for the same period in 2010, as the
company recognized a $28 million pretax
charge on the CH-53K program and
realized higher R&D expense associated
with 787-9 development in the current
quarter. Net income for the quarter was
$35 million compared to $56 million in the
same period of 2010.
industry People on the Move 22
International Lease Finance Corporation (ILFC)
announced the appointment of Elias Habayeb
to the position of chief financial officer.
Habayeb will lead the company’s financial
operations including treasury, insurance,
accounting, and enterprise risk management
and will report to president Fred Cromer.
Habayeb most recently served as senior vice
president, Investments and Financial Services
for ILFC’s parent company AIG.
San Diego-based aviation MRO software
company Quantum Control appointed
Jason Cordoba to director of StockMarket.
aero,where he will be responsible for
developing competitive marketing plans to
help all aviation professionals increase revenue
and company exposure on StockMarket.aero.
EADS North America appointed Paul G .
Pastorek as chief counsel and corporate
secretary. In his new position. Pastorek will
direct the company’s legal activities, including
the contracts, export control and compliance
functions, and serve as secretary to the
company’s board of directors.
TP Aerospace announced the appointment of
Deimante Lankelyte, who will relocate to
the firm’s Copenhagan offices where she will
concentrate on business activities in CIS and
Eastern Europe. Deimante has an extensive
background at Lithuanian Airlines dating
back to 1999 and played a key part in the
establishment of FL Technics in 2007.
Chromalloy announced that aerospace industry
veteran Dennis Orzel has joined the company
as vice president and general manager. His
responsibilities include leadership of key
Chromalloy technology development and repair
sites in the US and UK.
Mitsubishi Aircraft Corporation announced to
the board of directors that Nobuo Toda, chairman
of Mitsubishi Aircraft Corporation will retire
from the company on June 28, 2011. There will
be no new person assigned to this position.
Airline Services (ASL) announced the appointment
of a new regional sales manager. Geoff
Cowper will join the company’s sales and
commercial team in May to support its growing
business in international markets. Airline
Services Components (ASC) announced the
appointments of Richard Jowett as general
manager and Mark Kelsey as head of sales.
Deutsche Bank Securities reported that Douglas
Runte will join as a managing director and
head of Aviation Debt Research within the
Bank’s Markets division. In his new role, Runte
will cover the transportation sector, focusing
on airline, aircraft lessor and other aircraft-re-
lated debt across the investment-grade, highyield
and ABS markets.
Aveos reported that Joe Kolshak is joining
Aveos as president & CEO. In addition, Peter
Timotheatos, VP Finance at Aveos, is promoted
to CFO. Chahram Bolouri, former
president and CEO, and Robert Comeau,
former vice president and CFO, are leaving
Aveos to pursue other interests.
Armando Boucourt was promoted to vice
president – New Business Development & Distributions
for the Kellstrom Defense Aerospace,
a division of Kellstrom Industries.
Constant Aviation appointed Mandy Morrison
as director of service and support at their
Cleveland facility.
Crane Aerospace & Electronics named Steve
Reid to the position of senior director of site
operations at Crane’s Elyria, Ohio site.
Rockwell Collins’ board of directors elected
Jeffrey Turner to become its ninth member.
He will fill a position that is subject to reelection
at the company’s annual shareowners
meeting in 2013. Turner is currently president
and chief executive officer as well as a director
of Spirit AeroSystems Holdings.
CIRCOR International announced that Michael
Dill has been promoted to group VP for CIRCOR
Aerospace. Dill will be responsible for CIRCOR’s
world-wide aerospace business and will report
directly to Bill Higgins, CIRCOR chair and CEO.
The board of directors of SME appointed
Philippe Schleicher chairman and chief
executive officer and named Hervé Austruy
chief operating officer. SME is a subsidiary of
the Safran group.
Exostar announced the appointment of Richard
Addi as the company’s president and
chief executive officer. Addi has been with
Exostar since 2007, previously serving as chief
financial officer.
PAS Technologies announced that Daniel
Boggs has been appointed general manager
of the company’s gas turbine engine component
service and manufacturing center in
Hillsboro, Ohio.
HNA Group Company Limited (HNA) of China
and Bravia Capital (Bravia) of Hong Kong
announced the appointment of Donal Boylan
as the new chief executive officer of Hong
Kong Aviation Capital (HKAC), a subsidiary of
HNA and a Bravia affiliate.
AviTrader MRO - May 2011