Asia’s MRO sector set to grow thanks to new carriers.
SINGAPORE—Maintenance, repair and overhaul (MRO) firms are set to benefit from a wave of new start-up carriers in Asia.
Carriers are preparing to launch operations in an effort to capitalize on the next travel boom, but because these start-ups are small, each will be relying heavily on outside parties for line and heavy maintenance.
In Malaysia, Heritage Air plans to operate BAe 146s andERJ 145s from its base in Malacca to Singapore as well as destinations in Indonesia, Malaysia and Thailand.
CEO Radzlan Abu Bakar says Heritage will primarily operate passenger charters. It had its first charter on Dec. 12 with a return service from Malacca to Timor Leste’s capital Dili. On this occasion it wet-leased a BAe 146-200, registration RP-C5525, from Filipino carrier.
Radzlan says Heritage plans to apply for a Malaysian air operator’s certificate so it can operate aircraft in its own right.
It is speaking to, and if it secures dry-leases on BAe 146s, there is a strong possibility the heavy maintenance checks will be at IndoPelita. This is the MRO firm of Indonesian carrier Pelita Air Services and the only business in Southeast Asia, other than the Philippines’ Lionair, that does BAe 146 heavy checks.
Sandy Koesdarsono, IndoPelita VP sales and marketing, says he already has spoken to Radzlan.
Koesdarsono says IndoPelita has Indonesian and Philippine certification for heavy checks on BAe 146 and RJ-series aircraft, and this year the firm will submit an application forand certification.
If Heritage also adds Embraer ERJ 145s, the heavy checks on those airframes are likely to go to either Tianjin Airlines’ MRO facility or to Shandong TAECO. China is the only market in Asia Pacific where ERJ 145s are present.
Myanmar is another market where there are start-ups and the heavy checks are likely to be done overseas.
Two would-be carriers, Air Kanbawza and Asian Wings Airways, are trying to secure-500s, say industry executives. Air Kanbawza derives its name from its owner, Myanmar’s Kanbawza Bank, which in early 2010 bought a large stake in Myanmar Airways International. The other, Asian Wings Airways, is linked to Sun Far Travel & Tours, based in Myanmar.
Aerospace Engineering is well placed to secure the heavy checks on the Myanmar aircraft because it has a joint-venture MRO business, at Kuala Lumpur’s Subang Airport, with ’s 50% owner Alenia Aeronautica. The JV was formed in 2009 after MAS ordered 30 ATR aircraft in 2007 including options.
The other MRO firm that may vie for the business is Fokker Services Asia (FSA), which has EASA and FAA certification for-300/500s and ATR 72-200/500s.
FSA also has experience working for Myanmar carriers because up until ATR came along, Fokkers were the dominant aircraft type there.
Indonesia and Thailand
The other two markets where start-up carriers will be launching are Indonesia and Thailand. These two countries have relatively few MRO firms but there are players moving in.
Indonesia’s second largest carrier, Lion Air, has started building a maintenance hangar at Manado that will open around July.
Besides the hangar for airframe maintenance, there will be facilities for engine repair and overhaul, cabin repair, avionics and non-destructive testing equipment.
Lion Air has 56 aircraft, of which 43 are-900ERs, and it has another 139 737-900ERs on order, says Ascend data. Its subsidiary Wings Air, meanwhile, has nine ATR 72-500s with another six on order, says Ascend.
Lion President Director Rusdi Kirana says the airline plans to do its own 737-900ER and ATR 72-500 heavy checks.
Having work done in-house is better because the carrier no longer has to rely on third parties that may sometimes fail to have slots available, he says.
Lion has been sending its aircraft to’s GMF AeroAsia but GMF sometimes has slot constraints.
GMF is working to overcome the slot issue and has drawn up plans to build a fifth and sixth hangar with construction due to start this year.
The lack of MRO capacity in Indonesia means the majority of Indonesia’s heavy maintenance work goes overseas, mostly to Singapore and Malaysia.
But Rusdi says it makes no sense to send work overseas, because the ferry flights are expensive and manpower costs are higher abroad.
In terms of Indonesian start-ups, there is Sky Aviation, a general aviation operator that is branching into commercial operations in late February. It has signed finance leases for three Fokker 50s fromand plans to have 10 at year-end.
Sky Chairman Yusuf Ardhi says the carrier wants to outsource line and heavy maintenance and is speaking to FSA.
FSA regional director sales and marketing, Michael Cole, says they have recommended that Sky handle line maintenance in-house and outsource heavy maintenance.
He says Sky already has signed on for the Fly Fokker Take-Off program, which includes a lease on a stockpile of spare parts stored at Jakarta’s Soekarno-Hatta International Airport as well as an exchange program for components.
Cole says Sky’s first three Fokker 50s were previously operated byand the first was due to arrive in Indonesia in February, the second in March and the third in early April.
“Sky has selected aircraft in a such a state that these are at half cycle, so they will be able to fly them for two years without any heavy maintenance [check] required,” he says.
But the landing gear on the first aircraft will have to be changed as it is close to its limits, says Cole. This is covered by FSA’s landing gear exchange program, which means Sky gets a newly overhauled landing gear immediately and Sky’s landing gear will be overhauled and enter Fokker’s spare parts pool for the next available customer, he says.
Thailand is another growing market for MRO firms. Leisure carriers Jet Asia Airways and Crystal Thai Airlines recently received air operator certificates (AOC) from Thailand’s department of civil aviation.
The department’s director of flight standards, Sumpun Pongthai, says Jet Asia plans to fly an ex-SkyStar Airways-200 on routes between Thailand and South Korea. The department inspected this aircraft, prior to issuing the AOC, and it is parked at Seoul Incheon International Airport.
The airline already has employed some maintenance personnel and is in the market for more because it wants to add a second 767 soon after it launches operations, says an executive at the carrier, who wishes to remain anonymous.
He says they plan to employ more then 40 maintenance personnel to perform line maintenance. Heavy maintenance will be done either byin Singapore or Guangzhou Aircraft Maintenance Engineering (GAMECO), he adds.
Crystal Thai also is preparing to launch and has secured leases on oneand one , says Crystal Thai Airlines VP Pittipol Vannarot.
He says Crystal Thai is relying on Global Engineering for line maintenance and Thai Aviation Industries (TAI) for heavy maintenance. Both are based in Thailand.
Besides TAI, which is a joint-venture between the Thai air force and the government, the other major MRO firm in the country working on airframes is Thai Technical, the maintenance and engineering arm ofInternational.
But the airline’s president and CEO, Piyasvasti Amranand, told O&M’s sister publication Aviation Week & Space Technology in October that Thai Technical has been so busy working on Thai Airways’ aircraft, it has no slots to serve additional third-party customers.
But Thailand’s government has stated publicly that it wants the country to become a MRO hub for the region.
In an effort to cater to this market opportunity, Norwegian MRO firm Scandinavian Aircraft Maintenance (SAM), has established an off-shoot in Thailand, SAM Thai.
“SAM Thai was created to serve Asia with maintenance for fixed-wing aircraft and helicopters,” says SAM President and CEO Ole-Petter Monsbakken.
The company plans to provide line and heavy maintenance services in Thailand but is still waiting on some regulatory approvals. It has been biding its time by getting contracts for work on aircraft parts and then having the work done at its facilities in Scandinavia.
Monsbakken says one way SAM Thai could move into line maintenance is to use Scandinavian Aircraft Maintenance’s EASA Part 145 approval to win line maintenance work from European carriers operating to Thailand.
As for the heavy maintenance facility, SAM Thai has approval from the land owner, the Thailand department of civil aviation, to start construction at Korat airport, he says.
But he adds that SAM Thai is waiting on approval from Thailand’s Board of Investments.
Monsbakken says SAM owns 49% of SAM Thai and the other 51% is owned by Thai nationals in accordance with the country’s foreign ownership laws.
The plan is to build two hangars at Korat airport, one for helicopters and one for fixed-wing, he says, adding that the fixed-wing facility will be able to accommodate one-400.
Korat’s runway can only handle aircraft as large as an Airbus A320 or737 although the authorities have a plan to extend it to accommodate 747-400s, says Monsbakken.
However, it is more likely that SAM Thai will initially focus on heavy checks for A320s and 737s, he says.
Monsbakken adds, “We will invest in an educational center [in Korat] for training pilots and technicians.”