Boeing 737 Demand and Pricing Firming Up
After the Boeing 737 MAX aircraft fleet was grounded by regulators worldwide in March, some noticeable trends are occurring in the market for Boeing 737 Classic and Next Generation aircraft, according to Firoz Tarapore, CEO of Dubai-based lessor DAE Capital.
“Both demand and pricing are firming up,” Tarapore told Inside MRO. However, with changes due for the MAX, including a new software fix and overhaul of pilot training from Boeing, he does not see this being the new norm. “This phenomenon is likely to abate after a permanent and satisfactory fix has been put in place for the MAX,” Tarapore says.
Southwest, Mechanics Reach Tentative Agreement
Southwest Airlines and the Aircraft Mechanics Fraternal Association (AMFA) agreed to terms on a new contract that, if ratified by the mechanics, would end more than six years of often contentious talks. The Agreement in Principle (AIP), reached March 16 after a week-long round of negotiations, includes a 20% raise for mechanics effective April 1 and 3% base-rate bumps annually in 2019-23. It is also believed to include some added third-party maintenance provider flexibility for Southwest.
The AIP will be written as a tentative agreement for AMFA members to vote on. If approved, the deal would become amendable in August 2024.
Latin America MRO Demand, 2019-23
Expect aircraft MRO demand in Latin America to be dominated by Airbus ($8.1 billion), Boeing ($7.3 billion) and Embraer ($1.7 billion) over the next five years, according to Aviation Week Network’s 2019 Commerical Aviation Fleet & MRO Forecast. The total MRO demand for the region in 2019-23 will be $19.4 billion, with airframe MRO demand comprising just 8% of that total. The largest percentage, 36%, will come from engine maintenance demand.
Sapura Technics To Open in Malaysia in July
A new narrowbody MRO, Sapura Technics, is expected to open at Senair Airport in Senai, Johor, Malaysia, in July after it obtains its first regulatory approval from the Civil Aviation Authority of Malaysia. The MRO, owned by Sapura Resources Berhad, is taking over two hangars—each for one narrowbody aircraft—from Sapura Aerpo, which provides aircraft management services. Initially, the MRO plans to provide line and base maintenance (up to C checks) for Boeing 737 and Airbus A320-family aircraft, supported by backshops for composites, sheet metal, non-destructive testing, paint and battery charging.
AJW Group expanded a power-by-the-hour deal with SmartLynx Airlines to cover the supply of consumables/expendables for its Airbus A320 fleet.
Etihad Airways Engineering secured a deal with Sky Prime to provide aircraft heavy maintenance and cabin modification support, including Part 21J and Part 21G engineering services, and pilot/crew training for its Airbus A320 and A340 and Boing 777 and 787 aircraft.
Korean Aviation Engineering & Maintenance Services completed its first C Check on a Jeju Air Boeing 737NG; the first 737NG for Eastar Jet was due March 19. It is jointly owned by KAI, Korea Airports, BNK Financial Group, Jeju Air and Eastar Jet.
Lufthansa Technik secured Total Component Support contracts from AirBridgeCargo Airlines for its Boeing 747-400Fs and from Ural Airlines for its 737 MAXs (in addition to A320neos), plus an A320 engine nacelle support contract from Aeroflot.
S7 Engineering was licensed by Honeywell to establish an APU repair facility in Russia; it expects to repair 50 APUs annually.
Staeco of China was named by Aeronautical Engineers as its fourth authorized 737 freighter conversion center, joining Commercial Jet in Miami; Commercial Jet Services in Dothan, Alabama; and KF Aerospace in Kelowna, British Columbia.
ST Engineering won a 10-year, $600 million heavy maintenance contract from an unidentified North American operator for more than 160 narrowbodies and widebodies. Work will be performed at its U.S. facilities in San Antonio and Pensacola, Florida.
Standard Aero was selected by Ghana’s PassionAir to provide PW150A maintenance at Singapore for Bombardier Q400s; the deal includes condition-trend monitoring.
TS&S (Mubadala) of Abu Dhabi signed an MOU with Honeywell to collaborate on repair/overhaul of 131-9 APUs and T-55 engines.