Air India bets on providing third party engg services

Mumbai: While private airlines like Kingfisher Airlines and Jet Airways are beginning to set up their own maintenance repair and overhaul (MRO) facilities, National Aviation Company of India Limited (NACIL) – the new company into which Air India and Indian have been merged – is betting big on third-party engineering services, i.e. offering maintenance services to other airline companies.

“We want to cash on our first-mover advantage in maintenance engineering by expanding our CFM (engine type) capability,” said a top official in Air India.

The national carrier would be servicing 30 third-party engines per year by 2011-2012.

While the value of this deal is expected to touch $40 million by then, the airline is aiming at revenues of $8 million. The move seems significant seem at a time Kingfisher is setting up an MRO next in Bangalore quarter, while Jet Airways is looking at a similar facility in Chennai next month.

While Indian hasn’t forayed into the third-party services bandwagon, Air India earned revenues of over $2.5 million during FY07. The company is also expanding its servicing capabilities for CFM engines. ‘CFM 56’ engines are used in its Boeing 737-800 aircraft.

“We would be looking at other engines by the middle of next year,” said KM Unni, Director – Engineering, Air India.

The national carrier also bagged a three-year $20 million servicing deal from Biman – the national airline of Bangladesh in May this year. Air India has also been servicing Chromalloy Engine management Services, USA; Star Aviation FZC, UAE; Israel Aircraft Industries, Israel and Aviation Trading & Leasing Inc, USA. “We would be using our existing clients to grow our servicing pie organically in these regions,” said Unni.


Source: mumbaimirror.com