International growth and new digital products were the hot topics for Lufthansa Technik’s annual press conference in Hamburg, Germany yesterday. Held in the Innovation Center Showroom—which executive board chairman Dr. Johannes Bussmann said was an appropriate venue due to all of LHT’s recent innovation efforts—the conference highlighted the company’s best sales results in history, growth plans and new digital products.
“Year of Sales”
Bussmann described 2017 as “the year of sales” for LHT, citing sales revenue growth of 260 million euros over 2016 to 5.404 billion euros—an increase of 5%. The number of aircraft under exclusive support contracts with LHT grew by 10% to 4,550, which equates to around 20% of all commercial aircraft worldwide.
Constanze Hufenbecher, LHT’s Chief Financial Officer, said the Asia-Pacific region was the number one growth driver for MRO in 2017, with demand growing by 12.5%. Hufenbecher expects significant growth in this region within the coming years. Meanwhile, sales in the Europe/Middle East/Africa region grew by 8.8% while the Americas saw a slight decline of around 2% in sales.
Bussmann cited great performance by LHT’s sales team in international markets, adding that this growth has allowed the company to work much more closely with individual customers and adapt to meet their needs.
Internationally, LHT’s expansion in 2017 has laid the groundwork for future development. Bussmann cited a number of examples, including the new XEOS joint venture with GE Aviation, which will bring the construction of a state-of-the-art maintenance facility for GEnx-2B and GE9X engines in Poland. Also in Poland will be LHT’s new joint venture with MTU Aero Engines, EME Aero. The JV will provide maintenance services for PW1000G series turbofans. Although growth in North America has been slow, Bussmann says more growth is expected at LHT’s Component Services facility in Tulsa, Oklahoma, which completed a major expansion late last year. Additionally, Bussmann highlighted contracts in 2017 with Air Canada, Honeywell, Asiana Airlines and EL AL—the latter of which is LHT’s first business with the airline.
Locally, LHT has taken steps to introduce LEAP engine overhaul and expand component repair services. The company has modernized its headquarters in Hamburg with a new Center of Excellence for engine casings and a new x-ray center. The company also invested 60 million euros in a new wheels and brakes workshop in Frankfurt.
New Digital Products
Bussmann says digitization is important for the entire MRO industry’s business model and that LHT is thinking of it in three dimensions: core business, products and the creation of a new digital business model and ecosystem. Although LHT has released a slew of new products in recent months, the press conference highlighted its Aviatar platform. Bussmann says its open platform architecture has generated interest even from start-ups outside the aviation industry, which the company is working with to develop new technologies.
At the press conference, LHT displayed two new applications for Aviatar that were created through last year’s employee idea initiative. The first is the company’s online brokerage platform for tool loans, ToolNOW. Peter Golibrzuch, IT project manager for digital fleet solutions, says ToolNOW is different from other online tool loan platforms because it is a demand-driven platform. This means that providers only list tools that are available for loan rather than their entire inventory, resulting in more reliable offers. The application is composed of two user roles: demander and provider. Demanders fill out tool request forms with information about needed part numbers, usage period, shipping location and required documents. Providers can view new requests, create offers, and attach documentation and loan agreements. From there, demanders can see and compare offers. Golibrzuch says the app is free for providers and free for demanders up until they choose to view specific offer details—which will cost 150 euros per request.
The other application, which is still undergoing testing, is AirGlance. Designed to streamline base maintenance communications, AirGlance provides a fleet dashboard and functionality to manage layovers. The app tracks turnaround time (TAT) items, actions, layover progress and milestone completion, which AirGlance product owner Kristoffer Bartsch says will reduce costs and delays due to communications backups and missing information. Bartsch adds that there will be more features to come and that LHT is about to undergo its first tests of the application in network. More tests are scheduled for this summer and Bartsch says the team hopes to have AirGlance ready for deployment by September or October 2018.
Meanwhile, Lufthansa Technik spin-off Skeyos announced that it is looking to the American market. Its new digital marketplace and procurement tool has been adopted by Oklahoma-based Mingo Aerospace, which is one of the company’s first American customers. The company plans to add more local personnel for better representation across the region and will be exhibiting at MRO Americas, April 10-12 in Orlando, Florida.