Page 14 - AAA JULY - AUGUST 2013 Online Magazine

FeATure Mro in AsiA

Asian Tech Tigers

Most commentators agree the growth in aviation is principally down to Asia. The
world’s largest aircraft orders come from Indonesia, Malaysia, China, India and more.
But can the region handle the MRO demands of all this expansion? Can Asia provide
enough capacity for the world’s fastest growing aviation sector? Will staffing demands
overwhelm availability? And just as importantly, can costs be kept competitive on a
global basis? By Jeremy Torr

“souTheAsT AsiA deFies descripTion. “Surpassing the traditional MRO Andrew Herdman, director general,
It has everything; traditional large airlines, concept of repair and overhaul, today’s Association of Asia Pacific Airlines
niche players, state-owned carriers, and MRO means integrated service including (AAPA). He notes that just as Asian
wholly entrepreneurial operators. From repair/overhaul, asset management like regional airlines are already recognised
an MRO point of view, this makes things pooling, logistics, engineering, training as a major global force, the airframe
very interesting.” So says Tom Anderson, and more,” says Adrien Moreau, AFI KLM and engine manufacturing sectors are
Airbus SVP for Services & Customer E&M sales director for North East Asia. also developing global manufacturing
Support, the man in charge of Airbus MRO As Moreau points out, it is becoming strategies and integrated supply chain
business in Asia. increasingly difficult if not actually networks here. “In the same way, we can
He is right. Asia is the fastest growing, impossible for any airline to keep tabs on expect to see further growth in MRO and
most dynamic region in the aviation all this. MRO is no longer something that other after-market services across the
business, and it comes with a completely the engineering staff handle on the basis Asia-Pacific region, “ he says.
different mix of operators from the rest of required checks and hours replacement.
of the world according to Anderson. It is a major project management issue. More of the same?
“Asia encompasses a very broad model, “It’s impossible for many operators [to As Moreau and Anderson both previously
right through from a very traditional keep on top of] everything. At first, airlines alluded, the scene in Asia is different to
vertical model to a young-fleet, brand- have to focus on their main activity, which the more established markets, however –
new [business] approach,” he says. This is passenger and/or cargo transportation. but no simpler.
means that at any Asian MRO depot, there Then, because of the learning curve, scale “There is no definite trend; besides
could be decades-old national carrier effects and investment restrictions [with outsourcing there is also insourcing
aircraft rubbing shoulders with the very MRO] they must usually eventually find a with respective capability and capacity
latest machines that rolled off Boeing or partner who has competitive advantages build up,” notes Wolfgang Reinert,
Airbus’s production line last week – all to help them,” says Moreau. This applies International Media Relations director
looking for different levels of service. equally to established names looking to at Lufthansa Technik AG. “If an airline
According to Anderson, the explosive save overheads, and also to new start-ups has opted for outsourcing, it needs
growth in LCC carriers, some with a “very who simply don’t have the cash to spend to consider where its interests are
rudimentary MRO capability” compared on anything other than operations that matched the most, with an OEM offering
to the national carriers’ full in-house generate cash flow. services (mostly integration without
capability, means a big provision challenge But despite the restrictive squeeze of own capabilities) or with another MRO
for the aircraft builders when it comes business bottom lines, the industry here provider having broad airline and
to underwriting servicing and overhaul is still growing – and with it MRO, asserts operational experience,” he says.
capability and capacity.
All this, increasing airframe and
avionics complexity, and the diverse
geographical constraints across the whole All MRO providers have adjusted their
world means the traditional approach to strategy and changed their business model to set
MRO, even for large operators – that of up JVs in Asia
wheeling the aircraft into the company
hanger – is being rapidly eroded. And Asia
is leading the change. – Adrien Moreau, AfI KLM Sales Director, North East Asia
14 ASIAN AIRLINES & AIRPORTS JULY / AUGUST 2013 WWW.ASIANAIRLINES-AIRPORTS.COM