Page 19 - AAA SEPTEMBER - OCTOBER 2014 Online Magazine

MRO INFRASTRUCTURE
ABOVE: Following the
completion and launch of
the HABOM Project, set to
become one the largest
maintenance repair
centres internationally,
Turkish Technic is to
significantly increase
its capacity, and aims to
boost revenues to USD1.5
billion in 2015
RIGHT: In the absence
of quality infrastructure,
airlines in India are forced
to carry out maintenance
outside India at the
nearest available MRO
locations such as South
East Asia, the Middle East
and even Europe
Photos courtesy of
Turkish Technic and
Lufthansa Technik
WWW.ASIANAIRLINES-AIRPORTS.COM
infrastructure and facilities prevent growth a necessity than an option,” Dubey says.
in the sector,” says Amber Dubey, a partner Moreover, India will have no dearth of
at auditor KPMG. skilled manpower and has the advantage
There are several financial, legal and of its good geographical position, he adds.
procedural limitations preventing the Currently, over 70% of all critical
MRO industry from growing. In addition checks on narrow body aircraft in India are
to taxation, the other key impediment farmed out to
to growth of airline MRO capacity is the international destinations. Barring
lack of availability of hangar space at key aircraft of national carrier Air India and to
international airports. a certain level
“Removing fiscal disincentives ( import private airline Jet Airways, most of
duty, value added tax and service tax) on the other carriers outsource their MROs.
domestic MRO, delinking MRO services IndiGo, the largest private airliner, gets its
from ground handling, increasing taxes MRO done at Sri Lankan Engineering, in
on export of MRO work are some ways by the neighbouring island nation Sri Lanka,
which countries such as Singapore, Brazil, which is hardly 30 minutes flying hours
UAE and Malaysia have become major MRO from India’s southern tip.
hubs. By emulating these best practices, Similarly, other low cost carriers such
India can hope to be the next MRO hub in as SpiceJet and GoAir have also signed
one of the fastest growing regions,” Dubey agreements with MROs outside India to
says. provide a wide-spectrum of cost-per-
About 15% of the revenue of airlines flight-hour maintenance for their fleet of
in India is spent towards maintenance; aircraft.
second only to the cost of carriers’ aviation “Since MROs in India are laden with
fuel. Most of the airlines make their own unfriendly custom duties and other tax
engineers to carry out tarmac inspections, structures, it makes it cheaper for airlines
but work with third-party MROs for engine, like ours to repair the aircraft overseas
heavy maintenance and modifications. than in India,” an official spokesman of
“The fleet size in India is now reaching a low cost carrier says on condition of
a critical mass where it makes sense to anonymity.
have a strong MRO space not just for the MRO units in India are constantly in
domestic fleet but also for international discussion with local and international
airlines. Growth of MRO in India is now carriers offering all facilities.
SEPTEMBER / OCTOBER 2014 ASIAN AIRLINES & AIRPORTS 19