O&M’s March 1999 cover on the left and O&M’s April 1999 cover on the right.
As we mark the 25th anniversary of the first MRO Europe held in Shannon, Ireland, Sept. 7-9, 1999, here is a look at notable news from the 1999 archives of Overhaul & Maintenance (Inside MRO’s previous name). E-commerce was taking off, and the first MRO forecast pegged industry revenue at $29.3 billion.
Creating EASA
The Aviation Safety and Security Directorate of the European Commission early this year expect to complete a draft of the treaty that will establish the long-debated European Aviation Safety Authority (EASA). The treaty will be presented to a committee of experts representing the 15 member states of the European Union, and, once it has been approved by them, will be presented to the non-EU states wishing to adopt it. . . .
Initially, the EC will negotiate on behalf of the EU member states with those non-member countries that are full members of the Joint Airworthiness Authorities (currently Norway, Iceland, Switzerland and Monaco). The other 18 states that are members of the European Civil Aviation Conference may be invited to attend the negotiations as observers, but are not expected to be among the initial signatories to the EASA treaty” (Overhaul & Maintenance January/February 1999, p. 55).
Quiet, Please
Europe is breaking ranks with the rest of the worldwide aviation community and moving unilaterally to impose stricter noise standards on airlines operating to and within its borders.
Until recently, operators of Chapter 2 aircraft had until April 1, 2002, to comply with Chapter 3 noise rules. That included any Chapter 2 aircraft operators added to their fleets between now and then. But if a proposal before Europe’s Council of Ministers becomes law, any additions to EU registers of jet aircraft recertificated (hushkitted or reengined) to Chapter 3 will be banned as of April 1, 1999. The 37 member states of ECAC, the Paris-based European Civil Aviation Conference, also are thought likely to adopt such a measure (Overhaul & Maintenance January/February 1999, p. 26).
E-commerce Takes Off
- Boeing introduced its internet-based parts ordering and tracking website, known as PART Page, in November 1996 and handled 1.6 million transactions in 1998, which was double the volume from the previous year. The service includes real-time tracking information. Boeing planned to add a distribution center in Amsterdam by the end of 1999.
- AirLiance, established in mid-1998 by Star Alliance partners United Airlines, Air Canada and Lufthansa Technik, takes its first steps to get into electronic commerce. “I think that electronic commerce through the use of the internet with respect to parts ordering and management is definitely the wave of the future,” said company president David Sisson. “In fact, it will be a requirement for our business, especially considering the global nature of the aircraft parts business. Because of that, I have proposals on my desk that would put in place an electronic infrastructure to provide 24-hr. access along with text and graphics data (Overhaul & Maintenance March 1999, p. 22).
- AAR offers two internet-based parts support services (AAR SuperSpares and AAR On-Line Parts Warehouse) and is developing a third (AAR On-Line) to allow customers to check on the real-time status of components they have sent to the company for repair.
- Aviall planned to place its “entire 1,500-page parts catalog online with a link to an order entry form” by the end of 1999” (Overhaul & Maintenance March 1999, p. 25).
First MRO Forecast
Overhaul & Maintenance produced its first MRO forecast, prepared in conjunction with and based on the models and calculations of The Canaan Group. The first commercial jet transport MRO market pegged the market at $29.3 billion and predicted it would grow to $35.9 billion by the end of 2004: “The largest percentage increase will be seen in the airframe heavy maintenance segment, which is forecast to grow 33% to $6.8 billion. Despite that increase, however, the engine MRO segment will remain the industry’s largest, with a projected increase of 23.4% to $9.5 billion” (Overhaul & Maintenance April 1999, p. 22).
British Airways Buys First Airbus
British Airways broke from its Boeing-only short-haul fleet and decided to buy from Airbus: “The first batch of 14 A319s for British Airways Regional is slated for delivery in September, with the rest following the end of 2000. These will replace BAR’s fleet of Boeing 737-236s, while its 737-300s will be replaced by seven more A319s in 2003. British Airways’ Euro-Gatwick operation will take 10 A320s by the end of 2001, plus 18 A319s between 2001-02. Ten more A320s join the fleet in 2004” (Overhaul & Maintenance April 1999, p. 42).
European Engineer Shortage
Worldwide worries about the shortage of engineers could have a greater impact on aviation than has yet been foreseen. Not only will the shortfall not support the massive fleet-growth forecasts, but the huge salary hikes needed to stop such skills from migrating to other industries could starve the regulators of experienced people.
In addition, in Europe, with 350,000 directly employed in 7,000 firms, the supply of trained labor in aerospace manufacturing is stretched as Airbus marches toward its stated goal of securing 50% of the aircraft market (Overhaul & Maintenance August 1999, p. 25).
Select News Briefs From 1999
- TRW agreed to purchase Lucas Aerospace parent company LucasVarity for about $6.6 billion. TRW Chairman and CEO Joseph Gorman said that adding Lucas Aerospace would enable TRW to expand the breadth of its aerospace activities, which had previously been more focused on space and defense. The long-term impact of the transaction on Lucas Aerospace and its operations are unclear.
- Lufthansa Technik (LHT) invested an additional $3 million in HEICO Aerospace Holdings. LHT owns 20% of the joint venture with HEICO. LHT has invested $38 million in HEICO Aerospace Holdings.
- KLM Engineering & Maintenance and Hamilton Sundstrand formed a joint venture to serve the European, Middle East and African MRO markets for large commercial aircraft pneumatic components.
- KLM, Northwest Airlines and Alitalia will begin joint marketing of their paint facilities. The airlines also are studying joint purchasing, initially for widebodies.
- Virgin Atlantic launched a $64 million interior/exterior upgrade, including double beds for Upper Class passengers and a new silver metallic paint scheme. Painting all 25 Virgin aircraft will cost about $4 million.
- SR Technics plans to extend its powerplant service center this year and add a new hangar for A330/A340 widebody maintenance. A new engine test stand with sound mufflers is scheduled for 2004.
- Revima won a 10-year contract to maintain and service landing gear and APUs on KLM Boeing 747s, DC-10s and MD-11s.
