A Middle East MRO alliance may again be on the agenda of industry leaders who have seen the sector shaken over the last two years by the knock-on effects of the pandemic.
Judging by the enthusiasm of some of the region’s top players, it’s an idea whose time may have come.
An exploratory meeting – suggested by Etihad’s Frederic Dupont – was expected before summer, schedules permitting.
Speaking on a leaders’ panel at MRO Middle East, Dupont said the industry should be looking to harness the considerable collective knowhow in the region “to complete each other rather than competing with one another”.
His fellow panellists – Fraser Currie of Joramco, Ziad Al-Hazmi of Lufthansa Technik Middle East (LTME), and Captain Fahd Cynndy of Saudia Aerospace Engineering Industries (SAEI) – concurred.
Joramco’s Currie said the pandemic “has taught us there’s a bigger picture”.
“Airlines are looking for long-term deals, locking in prices, locking in capacity,” he said. “Some of these large airlines could certainly be scoping their work across all of us. Customers are coming to us [looking] for a consistent service, but we’re not talking to each other.
“I think collaboration is something that has to, and should, come.”
Cynndy suggested the substantial investment by Saudi Arabia in a new Jeddah base for SAEI should be considered an investment for the entire region. “It’s about complementary services – making centres of excellence rather than just duplicating capabilities. We’re all customers of one another, we’re all partners with one another, and we’re also buyers of one another.”
Dupont said a regional body representing the MRO industry was mooted “a few years back”. Since then, the climate has changed. Everyone, he said, was now asking “how can we optimise our solutions, our workflows so we can deliver a better service to our customers?”
He pointed to the Independent Aircraft Modifier Alliance (IAMA) – of which his company was a founding member – as a current example of competitors linking up to develop standards and solutions to problems they all faced. IAMA now offers audits on its international standards of supplemental type certificate (STC) modifications. Etihad Engineering was expected to pass its first audit in March.
An overarching industry body would mirror the drift toward cooperation seen on the ground.
For Lufthansa Technik, agreements with other MROs, including Joramco and VD Gulf of Sharjah, were part of a long-term strategy “to merge into the community to become part of the regional set-up”.
Tim Butzmann, senior MEA sales director for Lufthansa Technik, observed that many local players had been doing “a very good job” through the Covid crisis. It remained to be seen, he added, if gains achieved through “aggressive” marketing were sustainable. He warned there might be “a bit of a shakeout”.
Reorganisation of Abu Dhabi’s MRO and related industry, as seen in the change in ownership for Etihad Engineering, Sanad Group’s expanded industrial strategy, plus SAEI’s mega-MRO facility in Jeddah, show a growing alignment with national economic strategies.
“We’re going to see a lot of local footprints in the market,” said Butzmann. “The local environment will provide for interesting competition.”
At the same time, major international players have been slower into the market than forecast pre-Covid. Boeing, for example, despite hitting record e-commerce levels with $2 billion of online parts sales in 2021, has been “less present” in the aftermarket. “What that means for MRO, I’m not so sure,” said Butzmann.
Although local competition was growing, he also expected the volume of Middle East MRO business to increase, judging by the healthy growth and load factors reported by regional carriers. Success will put them in the left-hand seat when it comes to expectations of the levels of service demanded of their MRO providers.
Another international player intent on building its regional capabilities is Safran Nacelles. AMES, its joint venture with AFI KLM E&M based in Jebel Ali Free Zone, has just added new jigs and tooling for the repair of the inner fixed structure (IFS) of the A330ceo thrust reverser.
Alain Berger, Safran Nacelles’ vice-president support and services, explained that the IFS is a complex structure – a large composite panel whose repair until now had to be carried out in France. By bringing the repair capability to the region, AMES was helping airlines save on downtime and transportation costs.
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