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Widebody Heavy Maintenance Likely To Grow In Europe

European MRO providers expected to benefit as more work returns from Asia-Pacific locations as the cost differential narrows.

Printed headline: Looking Inward

The outsourcing of widebody aircraft MRO requirements to service providers in the Asia-Pacific region over the past 10 years has been a prevalent industry trend. This has especially been the case for low-margin heavy maintenance work, with carriers from regions such as Europe attracted by lower labor costs and more spacious shop capacity sending aircraft out to facilities in China, Singapore and the Philippines.

But the Asia-Pacific region is evolving: Its indigenous fleet is expected to grow by more than one-third over the next 10 years, leading to a squeeze on MRO capacity which is already being seen to some degree in China. Demand for faster turnaround times (TAT) and logistical factors such as parts shipping and pooling constraints are proving challenging. In addition, the increasing prevalence of newer, less maintenance-intensive widebody aircraft such as the Boeing 787 and Airbus A350 also raises questions about the rationale for sending aircraft on long-distance trips strictly for MRO.

These factors have led to a growing trend for heavy checks returning to Europe from the Asia-Pacific region. Jonas Murby, principal at aerospace consultancy AeroDynamic Advisory, says this return of maintenance from Asia-Pacific MRO shops is already in progress to some degree. At Aviation Week’s MRO Europe in October, Murby noted that “a portion of this widebody fleet is outsourced to Asia, and there are signs that some of those checks may be migrating back to Europe.”

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Multiple factors are causing some heavy checks to return from Asia-Pacific to European MRO shops.

Vincenzo Quaranta, head of engineering and maintenance marketing and sales at Alitalia, believes much of the in-sourcing will take place with legacy aircraft, citing the A330 and narrowbody stalwarts the A320 and 737 as examples. “This will be due to the Asia-Pacific’s capacity being nearly full, but of course, due to their age in service, these aircraft will inevitably need heavy maintenance work” he says.

Alitalia has been undertaking some in-sourcing of its own by building up some airframe capabilities at its Rome facility to remedy slot-availability difficulties. “When there is a last-minute change in our plans, we find low flexibility from MRO providers as they are almost always full for the next couple of seasons,” Quaranta says. “We have full capability up to D checks on the Airbus A320, and we’ve started doing C checks on A330s operated by both Alitalia and third-party customers.” Having found additional third-party customers, Alitalia now finds its capacity nearly full through to the Summer 2020 season.

Independent MRO Sabena Technics, which operates its main base maintenance facility in Bordeaux, is also seeing a gradual movement of maintenance back to Europe from Asia. “Asia-Pacific capacity is growing, but demand is rising even faster so will make it more difficult for European airlines to get slots there,” says Fabian Ballet, senior vice president, head of sales and commercial director at the company. This has had a knock-on effect on labor costs in the Asia-Pacific region. “Man-hour rates are increasing,” Ballet adds. “What we saw less than 10 years ago were 7,000-8,000 man-hour checks going to Asia-Pacific. Now, at the breakeven point, it’s more around 15,000-man hours to absorb those ferrying and logistics costs.” He believes environmental factors are also affecting aircraft operators’ thinking in terms of maintenance locations. “Customers in Europe are becoming more sensitive to green aspects, and they may want to stay closer to Europe and avoid ferrying aircraft over to Asia,” he explains.

Other changes are also expected to alter the demand requirements of the MRO supplier base in Europe. Adopting advanced technology for heavy maintenance tasks will be one key change, Alitalia’s Quaranta argues. “MRO providers need to increase the level of technology they use,” he says. To reduce TAT, Alitalia plans to eventually use drones for aircraft inspections at its facility in Rome, having already obtained a licence from Italy’s aviation regulator to train for using drones and to subsequently carry out trials. “To do a check after a lightning strike currently takes up to two working shifts, as we have to tow the aircraft to the hangar, get closer to the platform and inspect from the top of the fuselage, so this is time-consuming,” he says. “This will allow us to save up to 1.5 shifts because we don’t need to tow the aircraft into the hangar or use the platform.” 

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