Boeing Grows Chinese Services Business Through New GAMECO Contract
Boeing Global Services (BGS) is growing its materials management business in China through a new Integrated Materials Management (IMM) program contract. The OEM signed a five-year IMM program contract with Guangzhou Aircraft Maintenance Engineering Co., Ltd. (GAMECO) on July 15, which it says marks the first time it will provide a comprehensive materials management solution in mainland China.
“China is a strategic and important market for BGS,” says Mini Desai, vice president of commercial spares and managed parts for BGS. “This partnership will enable us to better serve our customer base in China and provide solutions as market demands increase in the future.”
The formal agreement follows a letter of intent the companies signed in November 2021 at the Fourth China International Import Expo in Shanghai.
Under the IMM program, Boeing will provide demand planning, on-site staff and logistics services to support GAMECO’s operations. Boeing says the services will help the Chinese MRO optimize materials purchase and inventory costs while improving production service levels.
“Boeing’s Inventory Management Program is data-based and tailored to the needs of GAMECO,” says Norbert Marx, GAMECO’s general manager. “This program will secure the availability of parts and material in a timely and cost-efficient way while reducing our inventory holding costs.” He adds that the program will help GAMECO better support China Southern Airlines and other domestic and international airline customers.
The agreement is not the first collaboration between Boeing and GAMECO. The two companies have previously partnered on 737 and 777 landing gear overhaul and on passenger-to-freighter conversions. GAMECO operates several 737-800 Boeing Converted Freighter (BCF) lines at its Guangzhou, China facility and began its first 767-300BCF conversion earlier this year.
Boeing forecasts that Asia-Pacific-based airlines will require 505 freighter conversions through 2040. According to Aviation Week Network’s 2022 Fleet & MRO Forecast, there are nearly 2,000 Boeing aircraft in service in China and this is expected to grow to 2,501 aircraft by 2031. Aviation Week data predicts that the country’s total MRO demand will grow from $4.7 billion in 2022 to $6.9 billion in 2031.