October 2015 - www.avitrader.com

Going green MRO and environmental sustainability

Industry interview Pemco MRO News from around the world People on the Move latest appointments ICF Analysis Editor‘s Page 2 London bound All roads led to London, this month for ers in London that Delta TechOps will provide on their environmental policies and some of the MRO conference and exhibition. airframe maintenance support,for Virgin At- the challenges the industry faces with regards Not surprisingly all the major players were lantic’s fleet of 10 aircraft at it’s to environmental compliance. in attendance this year. The conference pro- Minneapolis facility. gramme highlighted a number of pressing is- Happy reading! sues for the European MRO industry, and many In this issue’s cover story we focus on the grow- new deals were announced. ing importance being placed on environmental Keith Mwanalushi sustainability in the aviation industry. MRO in Editor Delta Tech Ops for instance extended its rela- its very nature produces hazardous waste and tionship with Virgin Atlantic to include a new managing this waste in an eco-friendly man- three-year agreement to provide exclusive ner is ever more crucial today. We bring you an MRO services. The U.S, based MRO told report- analysis of various strategies from key players

Published monthly by AviTrader Publications Corp. Suite 305, South Tower 5811 Cooney Road Richmond, British Columbia V6X 3M1 Canada Email: [email protected] Tel: +1 (424) 644-6996 www.avitrader.com

Editorial Keith Mwanalushi, Editor Email: [email protected] Mobile: +44 (0) 7871 769 151

Design Volker Dannenmann, Layout & Design Email: [email protected] Mobile: +34 657 218706 Hazardous waste is generated from several MRO activities. Photo: Vector Aerospace Advertising inquiries Jenny Falk Contents Head of Sales & Marketing Email: [email protected] MRO and Production News ...... 4 Tel: +49 (0) 8761 346007 Finance News ...... 14 Information Technology ...... 15 Registration Other News ...... 16 AviTrader MRO is a subscription-free monthly publication. To receive a Cover story: MRO and environmental sustainability ...... 18 personal copy in your inbox every month, please click here to subscribe. Components: With AJW Group and Thomas Global Systems ...... 22 Industry Interview: Pemco ...... 24 Opinion Please send your comments and queries to ICF Opinion: Key battlegrounds in the aftermarket ...... 26 [email protected] People on the Move ...... 28

AviTrader MRO - October 2015 Quality • Value • Customer Service

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tion capabilities — a cost-effective solution that increases airport traffic capacity while decreasing weather-related delays, noise and operating costs through more efficient routing and improved navigation performance. Honeywell’s Integrated Multi-Mode Receiver (IMMR) navigation receiver will enable airline operators to take advantage of the latest in satellite-based navigation such as Honeywell’s SmartPath Ground-Based Augmenta- tion System (GBAS), which allows more accurate approach and landing access than today’s land- based systems. The new navigation receiver will also offer expanded capabilities for landing in very-low-visibility weather conditions.

FL Technics ready to offer Airbus A330 maintenance

FL Technics, a global provider of tailor-made aircraft maintenance, repair and overhaul services, has successfully completed the necessary theoretical and practical training for execution of Airbus A330 maintenance. Having already purchased all the MTUPlus Asset Value Maximization Photo: MTU Maintenance necessary equipment, the company is expecting to complete the certification by the end of 2015. MTU Maintenance launches new service Wizz Air extends line maintenance con- “FL Technics estimates there are almost 150 Airbus for engine asset and material management tract for growing fleet A330 aircraft operated in Europe alone. Therefore, as maintenance of wide-body aircraft is not as seasonal as that of the narrow-bodies, the latest MTU Maintenance has launched a new ser- The Hungarian low-cost carrier Wizz Air has extend- expansion of capabilities will allow the company vice targeted at engine asset owners seeking ed its contract with Lufthansa Technik Maintenance to keep its current and upcoming facilities full all to increase their return on investment and to International (LTMI) for line maintenance services year round,” shares Zilvinas Lapinskas, the CEO of find a smooth exit for their end-of-life engines. in Romania and Slovakia. The new agreement runs FL Technics. “We are confident that, in addition to MTUPlus Asset Value Maximization offers asset for eight years from November 2015 and reflects the well-established narrow-body capabilities, the owners with a surplus engine different solu- updated conditions and scopes of work. LTMI cur- expanded list of our services will make us more vis- tions which either optimize its usage if the asset rently supports Wizz Air with line maintenance ser- ible, attractive and accessible not only to our clients can still be operated or maximize the material vices for 16 A320-200 aircraft in Romania and other in Europe and the CIS, but also customers in such value through the remarketing of its individual countries. Under the new agreement, LTMI will per- rapidly developing markets as Asia.” parts. The evaluation of the engine’s residual form line maintenance at six stations in Romania value is one MTU Maintenance’s key compe- and Slovakia, with the possibility of enlarging the tences and forms the basis of MTUPlus Asset network with new stations. LTMI will look after the Value Maximization. Depending on the results, airline’s growing fleet, including the new A321neo engine owners have several options to perform aircraft. As part of the agreement, LTMI will con- Rolls-Royce announces TotalCare Flex a smooth exit of their end-of-life engines and tinue to manage the line maintenance network and agreement with bmi regional earn money with these at the same time. Offers be responsible for the entire fleet stationed in this run from lease-out, sale and exchange solutions region. Its comprehensive services include a single Rolls-Royce has signed a TotalCare Flex agree- to teardown and material management. Built point of contact for all line maintenance issues, pre- ment with bmi regional for 17 Embraer 145 air- on a modular basis, the different options can be ventive maintenance, and performance monitoring craft powered by AE 3007 engines. The agree- combined among each other to fully respond to of the fleet managed by LTMI. ment marks a new milestone for TotalCare Flex, the requirements of the engine owner. MTU- designed for owners and operators of mature Plus Asset Value Maximization is carried out by engines, as it is the first deal signed with a re- MTU Maintenance’s subsidiary MTU Mainte- gional aircraft operator. The new service builds nance Lease Services B.V., a joint venture with Honeywell offers latest navigation tech- on the success of Rolls-Royce TotalCare, where the Japanese trading house Sumitomo Corpora- nology for A320 and A330 the business models of the aircraft owner and tion. The joint venture was founded to increase Rolls-Royce are fully aligned to improve engine MTU’s activities with the leasing of commercial Honeywell Aerospace’s latest navigational tech- reliability, increase time on wing, and maximize aircraft engines and has now been expanded nology will be available as an option on Airbus the engine services contribution to customer further to include asset and material manage- A320 and A330 aircraft in early 2018. The new business performance. TotalCare Flex tailors that ment services for older and current generation Integrated Multi-Mode Receiver will offer Airbus service specifically for customers seeking eco- engines as well. customers access to the latest precision naviga- nomical management of mature engines.

AviTrader MRO - October 2015 MRO and Production News 5

services. On pilot training, ST Aerospace’s pi- lot training academy signed a two-year training agreement with an Asian airline for dry and wet simulator training solutions for its pilots. The aer- ospace sector redelivered a total of 349 aircraft for airframe maintenance and modification work in 3Q2015. In addition to airframe redeliveries, a total of 11,618 components, 41 sets of land- ing gear and 45 engines were processed, while 1,335 engine washes were conducted for both commercial and military customers.

Aviall adds new Ontic offerings for Boe- ing 777 and Airbus A320 applications

Aviall has signed an exclusive distribution agree- ment with Ontic which covers spare fuel measure- ment parts on the widely popular and Airbus A320 aircraft. The 10-year contract exten- sion expands the current agreement to include ini- tial provisioning spares and support of Ontic’s ret- rofit campaigns. Ontic, a BBA Aviation company, is the leading global provider of Original Equipment Manufacturer (OEM)-pedigree parts and MRO Dave Jackson, Managing Director, 328 Support Services (left) with Richard Dussault, VP-Marketing Pratt & Whitney Canada services for legacy aerospace platforms. For over Photo: TRJet 40 years, Ontic has licensed or acquired 4,500 top assemblies from leading aviation OEMs. On- TRJet to team with Pratt & Whitney Can- ST Engineering’s Aerospace arm secures tic has three manufacturing and support facilities ada on new, improved PW306B engines contracts worth US$410m in the third located in Chatsworth, Calif.; Cheltenham, U.K.; quarter and Singapore. This global agreement follows an In the latest step forward in creating Turkey’s existing long-term agreement between the com- first regional aircraft, TRJet announced an Singapore Technologies Engineering (ST Engi- panies wherein Aviall supplies fuel measurement agreement on plans to use Pratt & Whitney neering) has reported that its aerospace arm has for all commercial aviation customers. Aviall will Canada (P&WC) to upgrade and supply PW306B secured new contracts worth US$410m in the continue to support its OEM fuel measurement engines for TRJet aircraft. The memorandum third quarter (3Q) of 2015, for projects ranging components until 2026. of understanding involves Sierra Nevada Cor- from airframe and component maintenance to poration’s (SNC) German-based subsidiary 328 engine wash and pilot training. New contracts in- Support Services GmbH (328), the current type cluded in the 3Q2015 listed contracts are heavy airframe maintenance agreements for various certificate holder and a major partner in TRJet’s Monarch Aircraft Engineering completes 328 aircraft production. Work on the PW306B Boeing 777-300 and /A321 aircraft A300-600 heavy maintenance for the TRJet 32-passenger 328 aircraft series belonging to a US airline, as well as cabin inte- will commence at P&WC’s Longueuil, Quebec rior modification for another US carrier’s fleet Monarch Aircraft Engineering has completed facility in 2016, kicking off a production sched- of A319s. For component support, ST Aerospace a number of back-to-back heavy maintenance ule that will culminate in production and flight secured its first landing gear input from a Chinese checks for a major German cargo airline. MAEL of the first TRJ328 aircraft by 2019. During this airline customer, and an engine component re- carried out scheduled heavy maintenance in- time, work will also be underway on a turbo- pair contract from a major East Asian airline. It cluding various modifications, repairs and out prop engine for the T328 aircraft. Design ac- also secured several Boeing 737NG landing gear of phase tasks on a total of three aircraft for the tivities will be initiated in parallel for the new overhaul and exchange contracts for airline op- German cargo airlines A300-600 aircraft at its 628 aircraft series. This aircraft will be a clean erators in East Asia and Oceania, as well as Super London Luton Airport facility. sheet design, marking the Republic of Turkey’s Puma transmission components repair contracts first domestically-designed passenger aircraft. from operators in the region. Addi- The first flight of the 628 series is anticipated tionally, the aerospace sector received a contract for 2023, in honor of Turkey’s centennial. The extension for the component Maintenance-By- D328 is currently certified in 85 nations around the-Hour support of a fleet of Q400s over six Finnair and NORRA sign engine services the world and is in use in countries including years, for an airline based in the EMEA region. contract with LTAA the U.S., Switzerland, Germany, U.K. and Den- Separately, its Hondo-based facility was awarded mark. The versatile and rugged 328 turboprop an aircraft part-out contract for two 757-200 air- Finnair, Nordic Regional Airlines (NORRA) and and jet, with its large cabin comfort, is cred- craft. In terms of engine support, multiple con- Lufthansa Technik AERO Alzey (LTAA) have signed ited within the industry as a valued, cost-ef- tracts have been sealed with customers in Asia an exclusive long-term contract for the mainte- fective performer. Pacific and the US for EcoPower engine wash nance, repair and overhaul (MRO) of Nordic Re-

AviTrader MRO - October 2015 MRO and Production News 6

AFI KLM E&M news

AFI KLM E&M has been granted Part 145 ap- the Rome outstation, and has contracted with Privilege Style and AFI KLM E&M have signed proval by the European Aviation Safety Agency Vietnam Airlines to deliver line maintenance a contract covering component support for a (EASA) authorizing it to carry out line mainte- services at Paris-CDG. Boeing 777 which has joined the non-schedule nance for airlines operating the A350. Engaged airline’s fleet, the first aircraft of this type to be in a program to develop its dedicated A350 AFI KLM E&M and fast-growing leisure airline operated by Privilege Style. Under the terms of maintenance capabilities, AFI KLM E&M has, Jet2.com have signed an engine maintenance the new contract, AFI KLM E&M’s will provide with this new approval, extended its commer- contract for the UK carrier’s -800 component support for the Spanish airline on cial offering with the launch of line maintenance Next Generation aircraft. The agreement covers request, anywhere in the world. services. The Group has already provided tech- engine repairs, on-site and on-wing assistance, nical assistance services on customers’ A350s at as well as an engine leasing option. gional Airlines CF34-10 engine fleet. With this new tract under which AFI KLM E&M handles mainte- UTC Aerospace Systems celebrates 200th agreement, LTAA and Finnair further expand their nance and repair of the CF6-80C2 engines power- A380 landing gear delivery successful relationship which already includes a ing the carrier’s fleet of -200ERs and variety of MRO activities for several years. 767-300ERs – a total of ten aircraft. Omni Air In- UTC Aerospace Systems welcomed Airbus to its ternational is a privately-owned US airline operat- landing gear production facility in Oakville, On- ing domestic and international services. Set up in tario, to celebrate two program milestones. As 1993, it currently operates a fleet of twelve Boeing the supplier of the body and wing landing gear Omni Air International renews engine 767 and 777 aircraft in over 130 countries. Omni for the , the event commemorated support contract for Boeing 767 fleet Air International provides air charter services for the pending delivery of the 200th shipset of a diversified customer portfolio of travel agents, gear. It was also an opportunity to recognize the Omni Air International and AFI KLM E&M have scheduled and charter airlines, sports teams, and upcoming delivery of the first shipset of main inked a renewal of their existing long-term con- government agencies worldwide. landing gear for the A350-1000 program. As a

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running platforms including the A330. As part of this agreement, Alcoa will supply advanced fastening systems, such as those that enhance the assembly of aircraft panels and engine py- lons on newer airplanes with sophisticated de- sign features. Alcoa’s fasteners are made using a variety of materials including stainless steel, titanium and nickel-based superalloys, which improve fatigue life, enable lightning strike pro- tection, and improve wear and reusability on conventional and composite aircraft. Alcoa will produce these fastening systems at 14 of its global manufacturing facilities.

Crane Aerospace & Electronics to supply Door Control and Monitoring System for new Beluga airlifter

Crane Aerospace & Electronics has been chosen by Airbus to provide the Door Control and Moni- toring System (DCMS) for the new Beluga air- lifter, a special derivative of the A330 wide-body FL Technics adds to its EASA Part M capabilities Photo: FL Technics aircraft. The Crane DCMS will monitor, communi- cate and control the position of the main cargo leading provider of landing gear systems for FL Technics adds Sukhoi Superjet 100 to doors, as well as monitor the position of the aft commercial aircraft, UTC Aerospace Systems has EASA Part M capabilities cargo, bulk cargo and belly doors. In addition, the been supplying the body and wing landing gear DCMS will communicate with other aircraft sys- for the A380 since the outset of the program. FL Technics has added Sukhoi Superjet 100-95 tems as well as to door- and cargo bay-mounted At 19 feet tall, the body landing gear is the larg- (RRJ-95) aircraft type to its Engineering and status panels. The new Beluga was designed to est gear aboard a commercial aircraft and with Continuing Airworthiness Management capa- support production ramp-up, and is planned to 2 body gears and 2 wing landing gears supplied bilities. A relevant addendum to the company’s enter service in mid-2019. Crane is the technol- per aircraft, a shipset comprises 20 wheels. The EASA Part M certificate has been already issued ogy leader in proximity sensing systems around company is now leveraging its expertise to de- by the European aviation authorities. From now the world with over 12,000 systems delivered sign and manufacture the main landing gear for on, FL Technics specialists are eligible to support and in service. the A350-1000, the latest version of the Airbus SSJ100 operators and owners with a complete A350 XWB family of wide-body jetliners. range of aircraft engineering services, including Airworthiness Directive (AD) and Service Bulle- tin (SB) compliance control and implementation, Comlux America gets BBJ warranty re- aircraft maintenance programme development, pair facility and service center approval Chromalloy and Arabian Qudra partner technical records management, aircraft damage assessment and mapping, reliability monitoring, in new joint venture Boeing Business Jets has signed an agreement production of maintenance work packages,- air with its completion center, Comlux America, craft audits, etc. Chromalloy has formed a new joint venture with which designates the company as an author- partner Arabian Qudra – Chromalloy Arabia – to ized warranty repair facility and service center. provide the region’s growing energy and aero- The contract allows Comlux America to perform space sectors with life-cycle gas turbine engine warranty work on BBJ aircraft on behalf of Boe- solutions including component repair, new parts, Alcoa signs contract with Airbus for high- ing, providing BBJ operators another service field services, system upgrades and long-term tech, multi-material fastening systems option in the USA. Additionally, the Indianap- service agreements, in addition to its renowned olis-based company will provide other mainte- Tiger Monitoring & Diagnostic System. Chromal- Lightweight metals leader Alcoa has signed an nance, repair and overhaul services as required. loy Arabia will be headquartered in Jeddah, Sau- approximately US$1bn contract with Airbus Since its creation in 2008, Comlux America has di Arabia, with a sales office in Dubai, UAE. The for high-tech, multi-material aerospace fasten- accumulated a wide-range of experience on joint venture will provide a full range of turbine ing systems. The deal is Alcoa’s largest fastener completing and maintaining Boeing BBJ- air technologies that include maintenance, support, contract ever with the aircraft manufacturer. Al- craft for operators worldwide. The company parts and materials, and 24/7 field services on coa’s fasteners will be used to assemble some has installed interiors on 5 BBJs, including one site at power generation stations, electric utili- of Airbus’ latest high-growth airplanes, includ- BBJ3. Comlux America is currently expanding its ties, and on and offshore drilling platforms. Hani ing the A350 XWB, Airbus’ newest commercial 129,000 ft² (12,000-m²) facility to a wide-body Shehata has been named Chief Executive Officer airplane, and the A320neo. In addition, Airbus hangar able to accommodate large VIP aircraft for the new joint venture. will use Alcoa’s fastening systems for longer- up to Boeing 747BBJ aircraft.

AviTrader MRO - October 2015 MRO and Production News 9

bought the former Allison Engine Company in in Lindenberg, which is home to Liebherr-Aero- 1995 – will include a major renovation of the space Lindenberg GmbH, Liebherr’s worldwide existing facilities at Tibbs Avenue and Raymond center of excellence for flight control systems Street. Upgrades will include new manufacturing and landing gear. and assembly operations that will match the ad- vanced standards already present in many other Rolls-Royce facilities in Indiana and around the world. The five-year modernization plan, which Icelandair selects Aviointeriors for new is in-line with the Group’s ongoing investment B767-300 aircraft plans, will also consolidate operations and sig- nificantly reduce utility costs. Icelandair has decided to add two Boeing 767- 300s to its fleet from the spring of 2016. Ice- landair is a customer-oriented airline serving 42 gateways in Europe, USA and Canada. The Ice- Liebherr-Aerospace to supply high-lift landic airline will install “Andromeda” seating in actuators for Boeing’s 777X Business Class and “Columbus Three” seating in Economy Class on the new B767-300 aircraft, and Boeing has awarded Liebherr-Aerospace another further enhance the collaboration between Ice- contract for their 777X: the system supplier will landair and Aviointeriors. “Andromeda seat mod- deliver all high-lift actuators for the new wide- el confirms high level of comfort and reliability in body aircraft. Relying on its unrivalled experience medium-long range flights and Columbus Three is actually having a great success due to combi- Rolls-Royce announces reinvestment plan for Indianapolis in high-lift systems and especially in geared ro- facilities Photo: Rolls-Royce tary actuators for long-range commercial aircraft, nation of lightweight and modularity” said Pietro Liebherr-Aerospace will not only design, manu- Rizzo, SVP – Sales & Marketing of Aviointeriors. Rolls-Royce to invest nearly US$600m to facture and service the leading edge actuators, Delivery of the first seat shipset is scheduled for transform Indianapolis facilities but the company will also produce the trailing March 2016. edge actuators. The design and development of Rolls-Royce will invest nearly US$600m in mod- the Boeing 777X trailing edge geared rotary ac- ernizing its manufacturing operations in Indi- tuators, which are among the largest one’s ever anapolis and conducting technology research, designed and built for commercial aviation, will CTT Systems awarded humidifier con- ensuring that Indiana remains a leader in the reside with Boeing. Liebherr-Aerospace on its tract for new crew rest compartment on aerospace industry for decades to come. The part will support the design and development A380 modernization plan will enable the company to both from its Seattle office and its Lindenberg fa- become more competitive by replacing outdated cilities. In addition, Boeing has selected Liebherr- CTT SYSTEMS, a market leader of humidity con- facilities and accelerating the introduction of Aerospace to provide the 777X iron wing test rigs trol products in aircraft, signed a contract to de- new and advanced manufacturing methods. The and the mini rigs for secondary flight controls. velop a humidifier for a new crew rest compart- investment was made possible by the State of These test rigs will be built at Liebherr-Aero- ment on the A380 aircraft, to be introduced to Indiana, the City of Indianapolis and the United space’s test center for flight controls in Linden- customers in 2016. The humidifier will be offered Auto Workers (UAW) union. Rolls-Royce pro- berg (Germany). The iron wings will be installed in the A380 catalogue as Supplier-Furnished- duces engines for a wide range of military and there, whereas the mini rigs will be delivered to Equipment (“SFE”). CTT Systems already provides commercial aircraft, as well as marine propulsion Boeing’s site in Everett, Washington (USA). Lieb- crew rest humidifiers for the A380 program (as systems. This investment – the largest by Rolls- herr-Aerospace will perform all its design, de- tier-2). CTT humidifiers have been in service in Royce in the United States since the company velopment, testing and manufacturing activities the A380 aircraft since 2007.

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AviTrader MRO - October 2015 MRO and Production News 10

final assembly of the aircraft will begin in Tou- louse early 2016, followed by the first flight second half 2016. First deliveries are sched- uled to start mid-2017. Measuring nearly 74 meters from nose to tail, the A350-1000 is the longest-fuselage version of Airbus’ all-new family of widebody jetliners. The A350-1000 comfortably seats 366 passengers in a typical 3-class configuration and flies on routes up to 8,000 nautical miles.

GE signs CT7 engine service agree- ments supporting Era’s new AW189 and S92 aircraft

GE Aviation and Era Group signed two engine service agreements for the CT7-2E1 and -8A engines powering the new, twin- engine AgustaWestland AW189 and Sikorsky S-92 , respectively. These land- mark agreements begin a new GE–Era part- Fuselage assembly begins in Hamburg and Saint-Nazaire for the first A350-1000 Photo: Airbus nership by servicing the newest additions to Era’s fleet, the first AW189s operating Airbus starts assembly of first A350-1000 on board the Beluga. The nose fuselage sec- in North America and the S-92s, under the tion has been delivered by Stelia Aerospace Maintenance Cost Per Hour (MCPHsm) engine Less than one year after delivering the first to Airbus in Saint-Nazaire for assembly and service program. The 2,500-shaft-horsepow- A350 XWB (-900), the first A350-1000 is taking equipping. The forward and nose fuselage er-class CT7-8A and the 2,000-shaft-horse- shape with the assembly start of the first fu- sections will then be joined together in Saint- power-class CT7-2E1 engines are leaders in selage major components at Airbus plants in Nazaire to form the front fuselage which will GE’s successful T700/CT7 family of turboprop Hamburg and Saint-Nazaire. The forward fu- then be flown by Beluga to the A350 XWB Fi- and turboshaft engines, powering 25 types of selage section has been delivered by Premium nal Assembly Line in Toulouse. Assembly of helicopters and fixed-wing aircraft with more Aerotec to Airbus in Hamburg where it will be the first A350-1000 wings got underway in than 130 customers in more than 50 coun- equipped before being flown to Saint-Nazaire August this year at Airbus in Broughton and tries.

Busy month for AJW and its subsidiaries

AJW Group has awarded Rockwell Collins a PW4060 engines. Camair-Co has also signed inau (Moldova) and Paris CDG. five-year Fixed Price Repair agreement to a lease agreement with AJW Leasing for a re- maintain Rockwell Collins’ equipment in- placement PW4060 engine which has been Nepal Airlines has chosen AJW Aviation to stalled on AJW customers’ fleets. Aircraft fitted to their B767-300 aircraft. The Engine provide full power-by-the-hour services for covered include A320, B737, B747 and B767. Management Service (EMS) offered by AJW its current fleet of A320s. As part of the long- “This agreement solidifies a long-standing Engines is a tailored service that continuous- term agreement AJW will also locate extensive relationship that we have with AJW through ly updates customers regarding all processes main base kit at the Nepal Airlines’ facilities at our services business, as well as our Inter- on a daily basis. Tribhuvan International Airport in Kathmandu trade subsidiary,” said Thierry Tosi, vice pres- and at their operational centre in Singapore, ident and general manager, Service Solutions French ACMI, regular flight and charter taking advantage of AJW’s strategic hub strat- for Rockwell Collins. “We’ll be working with airline, Air Méditerranée, has chosen AJW egy across South Asia. The power-by-the-hour AJW to provide predictable maintenance Aviation to provide full power-by-the-hour contract for Nepal Airlines’ two new A320 air- costs and around the clock repair services to services for seven A321 Airbus aircraft. Four craft commences with immediate effect and it hundreds of aircraft around the world.” of the aircraft operate out of Paris CDG, two represents a ground-breaking change for the in the Middle East and one in Moldova, and airline. In the pursuit of greater efficiency, AJW Engines is to provide engine shop visit together the fleet flies an extensive route leaner processes and improved profitability, management services for Cameroon Airlines network across Europe, North and West Af- Nepal Airlines Corporation’s Board of Directors Corporation (Camair-Co). An experienced rica, and the Middle East. In support of the decided for the first time since the airline’s ori- team of professional engineers from AJW will multi-year agreement, AJW will also locate gins as Royal Nepal almost sixty years ago, to manage all aspects of the shop visit for two extensive main base kit in Dubai DXB, Chis- explore a new operational strategy.

AviTrader MRO - October 2015 MRO and Production News 11

Thales lands first Dual HUD Order in China on China Southern Airlines

Thales has reported that China Southern Airlines has selected the Dual Head Up Dis- plays (HUD) configuration across 30 of their new AirbusA320s, alongside the Thales Flight Management System and LRRARadio altim- eter. With this order, Thales scores a double first in China. This represents the largest con- tract for HUDs and the first ever for a dual configuration system since the Civil Aviation Authority of China (CAAC) made it manda- tory for all Chinese registered aircraft to be equipped with HUDs (single HUD configura- tion is the minimum requirement). The dual configuration developed by Thales, and cer- tified by Airbus in early 2015, is a clear step forward compared to a single configuration as it provides information to both pilots. With eyes focused outside, viewing the presenta- tion of flight path, acceleration, visual glide slope angle and the runway aim point, both pilot and co-pilot can achieve greater preci- sion and situational awareness at all times and are able to interact with one another with the same level of information during the critical phases of the flight, especially in low visibility conditions. Thales to configure 30 Airbus A320 aircraft from China Southern Airlines with Dual Head Up Displays Photo: Thales

in ’s aviation industry, the presence non-Thai professionals, maintain property of Hangar 4 marks a new business opportu- rights and benefit from certain tax advantag- Ameco completed 2nd A330 landing nity and prospective investment to reinforce es. During the following three years, the Bang- gear repair the national MRO industry. Supported by kok office should expand to accommodate a thousands of highly skilled workers, Hangar team of several dozen employees, including Ameco completed A330 landing gear trouble- 4 is expected to optimally support both local local professionals. Through its Bangkok cen- shooting for one Chinese domestic customer and international airlines to comply with the tre, FL Technics will promote and sell technical at the end of August. It’s the 2nd time to do global aviation safety standard as well as the training, engineering and consulting as well as such a work since Ameco got related authori- accessibility of spare parts requirements. engine management and support services for zation from FAA, CAAC and EASA last year. aviation players in the Asia Pacific. As the first MRO provider in China to per- form A330 landing gear overhaul capability, Ameco also services A320/321 and Boeing FL Technics to launch subsidiary in 737NG/747. Thailand MTU Maintenance and AAR extend cooperation for PW2000 parts supply FL Technics continues to expand its presence in the emerging markets. The company is al- MTU Maintenance and AAR have signed a con- Garuda Indonesia inaugurates GMF ready set to open a subsidiary with its main tract that secures for MTU the supply of used ‘Hangar 4′ office in the capital city of Thailand. Backed material for PW2000 engines over the next by official approval from the Board of Invest- five years. Within the framework of a consign- As a continuous business expansion program, ment of the Kingdom of Thailand, the Bangkok ment and inventory management agreement, designed to cope with the increased demands office shall act as the center of operations for AAR will store all PW2000 used parts at MTU’s in narrow-body aircraft maintenance, Garuda coordinating all company’s activities in Viet- facility in Hannover, Germany, which will sig- Maintenance Facilities (GMF) AeroAsia, a sub- nam, the Philippines, Myanmar, Cambodia, nificantly streamline the logistical processes sidiary of Garuda Indonesia, has completed , Indonesia and other countries in and improve the turnaround time for PW2000 the construction of Hangar 4, the narrow-body the region. Under the official approval docu- shop visits. The value of the contract amounts aircraft hangar with a maintenance capacity ment, received from the Board of Investment, to a three-digit million US dollar amount. The of up to 16 narrow-body aircraft including one FL Technics has gained the right to establish partnership between MTU Maintenance and bay for aircraft painting. GMF’s Hangar 4 was an enterprise in the Kingdom of Thailand un- AAR dates back to 1996 when MTU first con- officially launched on September 28th, 2015. der exceptionally favorable conditions. It will tracted AAR for the supply of used materials. In the midst of rapid growth and expansion enjoy such privileges as the ability to employ

AviTrader MRO - October 2015 MRO and Production News 12

Airinmar signs 3-year repair manage- engine in that facility for repairs. The term of facility will enable the increase in production ment agreement with ExpressJet the contract includes MRO services through capacity of stringers, reinforcement structures December, 2018. integrated into the wing boxes, which have Airinmar, a leading provider of innovative been produced at the Aircraft Shop since 2006. aviation repair management solutions, has For increased stringer production, production signed a three-year agreement with Express- machinery will go into operation sequentially: Jet, a subsidiary of SkyWest, to manage com- HAITEC granted approval for elite busi- including an autoclave for curing and shape- ponent repairs for its fleet of more than 300 ness jets forming the layered composite prepregs under regional aircraft. Airinmar has supported air- high temperature and high pressure, and cut- ting machines for machining of components. lines, MROs, OEMs and military operations Following the Gulfstream G650 Line Mainte- MHI has undertaken production of composite for over 25 years through the integration of nance approval received in June 2015, HAITEC wing boxes for the 787 Dreamliner since the its proprietary systems, engineering expertise Aircraft Maintenance has now been granted program was launched. Delivery of the first and supply management solutions. approval to perform Part-145 Base Main- unit took place in May 2007. tenance on the G650. As an EASA Part-145 organization, HAITEC holds approvals from Civil Aviation Organizations of , United Héroux-Devtek signs contract to sup- Arab Emirates, , Bermuda and the ply complete landing gear systems for FAA for a broad range of Boeing and Airbus Boeing to build 747 fuselage panels at the AW609 program aircraft, as well as ACJs, BBJs and Gulfstream Macon, Georgia facility business jets. Héroux-Devtek, an international manufactur- Boeing has announced that 747 fuselage pan- er of aerospace products, has been awarded els will be built at its Macon, Georgia facility a long-term contract by Finmeccanica-Agus- beginning in 2018. Boeing will take over the taWestland to supply the landing gear for the HAECO Group completes Boeing 787-8 work from Triumph Aerostructures – Vought AW609 TiltRotor aircraft. Under the terms of C-check Aircraft Division, a wholly owned subsidiary of the agreement, Héroux-Devtek will design, Triumph Group, with the Macon site providing develop, fabricate, assemble, test and deliver assembled fuselage panels to Boeing’s 747 fi- HAECO Group has completed its first C-check complete landing gear systems for the AW609 nal assembly line in Everett, Washington. Boe- on a Boeing 787-8 Dreamliner and redelivered aircraft. This life-cycle mandate also includes ing and Triumph Aerostructures have worked the aircraft to a leading international airline in the provision of spare parts. The new contract together to ensure a smooth transition for the September. This marks HAECO as one of the for Héroux-Devtek follows the introduction 747 supply chain. Boeing and Triumph Aero- first independent Maintenance, Repair and by AgustaWestland of several performance structures have worked together for many Overhaul (MRO) service providers to perform and product improvements to enhance the months to ensure a smooth transition for the a C-check on this new generation of aircraft. AW609’s capabilities. Design work is expected 747 supply chain. As part of this detailed pro- In March, HAECO Group acquired from Boeing to begin very shortly and will be mainly carried cess, the Boeing team selected the Boeing De- an advanced, simulation-based maintenance out at the St-Hubert (Québec) and Runcorn fense, Space & Security Macon facility for 747 training suite for the Boeing 787 Dreamliner, (UK) facilities, marking the first partnership fuselage panel work. making it the first MRO service provider and between Héroux-Devtek’s North American Defense work currently performed at the Ma- Aircraft Maintenance Training Organization operations and AgustaWestland. The Corpo- con site includes replacement center wing (AMTO) in China to become fully licensed to ration’s European operations had previously sections for the A-10 Thunderbolt II, as well as provide computer-based Boeing 787 training designed and developed the landing gear for sub-assemblies for the CH-47 Chinook helicop- to its own personnel as well as to third-party AgustaWestland’s AW101 aircraft. ter. Fuselage panels for the C-17 Globemaster customers. transport airplane were also produced at the site until earlier this year. Current defense work at the facility is scheduled to be com- StandardAero signs multi-year con- plete in mid-2016, at which time Boeing will tract to provide MRO services for Air MHI completes expansion of aircraft transition the site for Commercial Airplanes KBZ’s PW127M engines production facility at Shimonoseki work. Facility staffing will be temporarily re- Shipyard & Machinery Works duced during the transition. The site will ramp StandardAero has signed a multi-year contract up to full production on 747 fuselage panels with Air KBZ, a top regional and the largest pri- Mitsubishi Heavy Industries (MHI) has com- by mid-2018, at which point it will employ up vate airline in Myanmar, to perform custom- pleted facility expansion at the Aircraft Shop to 200 people. ized maintenance, repair and overhaul ser- of the Yamatomachi Plant of its Shimonoseki vices for PW127M turboprop engines on the Shipyard & Machinery Works in Yamaguchi airline’s fleet of ATR72-600 regional aircraft. Prefecture, , in preparation for produc- The new contract covers services for both hot tion increase of composite wing boxes for the Snecma kicks off construction of new section inspections and overhauls with not to Boeing 787 Dreamliner. MHI expanded the fa- world-class engine test stand in south- exceed guarantees for all the shop visits. All cility in response to Boeing’s plan to increase ern France engines will be serviced at StandardAero’s the 787’s production rate from the current 10 Winnipeg, Manitoba, Canada facility and the airplanes per month to 14 by the end of the Snecma (Safran) officially started the con- company already has inducted its first Air KBZ decade. The expansion at the Shimonoseki struction of a second open-air engine test

AviTrader MRO - October 2015 MRO and Production News 13 stand at its facility located at French air force Istres site a greater role in the development of will give customers up to 1.8 percent addi- base 125 in Istres, southern France. The new new commercial jet engines, featuring greater tional fuel-efficiency improvement over to- installation, comprising a test stand featur- fuel efficiency to increase their environmental day’s inline winglet designs. Boeing will build ing a design that is unique in Europe and a friendliness. the first 737 MAXs exclusively on the new pro- building housing all control systems, is on a duction line in the Renton factory. Once me- par with the best engine test facilities in the chanics prove out the production process, the world. It will be up and running in May 2016 team will extend MAX production to the other to test the new LEAP engine and the Open Boeing begins final assembly of first two final assembly lines in Renton. Rotor demonstrator. It could also be used for 737 MAX other engine configurations that Snecma will be testing in the coming years. Snecma’s sec- Boeing employees in Renton, Wash., have ond test rig at this site will cover some 80,000 started final assembly of the first 737 MAX MAEL to provide line maintenance m² (864,000 ft²). It joins the first test rig, in- 8 on schedule, the first member of Boeing’s support for GainJet Aviation stalled in 1969 and used for the development new and more efficient single-aisle family. Af- of Snecma’s commercial and military aircraft ter the first fuselage arrived on Aug. 21 from Monarch Aircraft Engineering, the engineering engines. This first rig is currently being used to Spirit Aerosystems in Wichita, Kan, mechan- division of The Monarch Group, has secured test Snecma’s new-generation Silvercrest busi- ics began installing flight systems and insula- a line maintenance technical handling agree- ness jet engine. Snecma invested some €15m tion blankets. Crews next moved the fuselage ment with GainJet Aviation. The agreement in this new test facility, with support from the to the wing-to-body join position on the new covers a full suite of line maintenance services federal, regional and departmental govern- production line where the first MAXs will be for the Greek operator’s VIP -200 ments. One of the challenges facing this piv- built. Mechanics then attached the wings to charter operation at Birmingham Airport in otal project, a key to the future and an engine the body of the airplane. The wings feature the UK. GainJet Aviation, headquartered in of local employment, is to energize the avia- Boeing’s new Advanced Technology winglets. Athens, is a new customer for MAEL. tion industry in the PACA region by giving the Designed exclusively for the 737 MAX, they

News from Lufthansa Technik AG

With its customer Finnair launching opera- tions of its first Airbus A350 XWB, Lufthansa Technik AG commenced the component sup- port for the new aircraft type. The first Eu- ropean airline to operate the A350, Finnair signed a twelve-year contract in May with Lufthansa Technik. As part of the exclusive Total Component Support TCS, Lufthansa Technik holds some 1,000 individual compo- nents at the ready – from cockpit computers and air conditioning systems to in-flight en- tertainment systems. These will be primarily repaired by Lufthansa Technik in the com- ponent workshops in Hamburg and made available, promptly, worldwide in the event of an AOG (Aircraft on Ground). Lufthansa Technik’s main warehouse in Frankfurt is the logistical backbone. The scope of the spare parts supply is expanding with the growth of the A350 fleet operated by the airline, which Lufthansa Technik Landing Gear Services UK Photo: LHT has firm orders for 19 aircraft of this type.

Lufthansa Technik Landing Gear Services UK (LTLGS) has overhauled Lufthansa Technik AG is the first MRO provider in Europe to install the 25th landing gear set of the Boeing 777-300ER aircraft type. split scimitar winglets on a Boeing Business Jet (BBJ). With this modi- Landing gear overhauls become due every ten years on each air- fication, the aircraft is the third BBJ in the world to be equipped craft in accordance with the maintenance program. As for the end of with these new aerodynamically optimized winglets from Aviation 2015, there will be 34 Boeing 777-300ER aircraft in operations which Partners Boeing. The modification took place over a period of ten are ten years old or older and which are scheduled to receive a com- days. Among other things, the specialists at Lufthansa Technik’s VIP plete landing gear overhaul. 25 Landing gear shipsets overhauled by & Executive Jet Maintenance product division reinforced various ar- LTLGS for leading European, Middle Eastern and Japanese operators, eas on the inside of the aircraft’s structure, particularly in the wing account approximately 70% of the total world-wide overhaul market tanks, in order to install the winglets. They also carried out complex share of this type of landing gear. painting tasks.

AviTrader MRO - October 2015 Finance News 14

Avianor sells wheel and brake maintenance business to AeroRe- cision to acquire TAAT from The Timken Company include organic growth pair Canada opportunities, the robust quality system, engineering expertise, and strong relationships with engine MROs and fleet operators of both helicopters and Avianor has completed an agreement to sell its Wheel and Brake Main- fixed wing aircraft. Kaman expects TAAT to achieve further growth through tenance Repair and Overhaul (MRO) business to AeroRepair Canada, a Kaman’s strong sales channels with a global reach. The organization will be- wholly-owned subsidiary of Aero 3 of Londonderry, New Hampshire, USA. come part of Kaman’s Specialty Bearings & Engineered Products division, led Avianor’s wheel and brake MRO facilities located in Mirabel, Quebec and by Robert Paterson. TAAT has annual sales of approximately US$20m. Calgary, Alberta will join the Aero 3 network of four MRO locations across the USA forming a strong North American wheel and brake MRO network. The transaction has now closed and has an effective date of August 31, 2015. Terms and conditions remain private. ST Engineering’s aerospace arm acquires remaining sharehold- ing of S-PRO

ST Aerospace Systems has acquired the remaining 50% stake in Singapore Rolls-Royce issues US bonds Precision Repair and Overhaul (S-PRO), from Messier-Bugatti-Dowty (Sa- fran), for a cash consideration of US$8.15m. Following the acquisition, S-PRO Rolls-Royce plc has successfully priced a U.S. dollar-denominated issue of notes will become a wholly-owned subsidiary of ST Aerospace Systems, which in (the “Notes”) raising gross proceeds of approximately US$1,498,740,000. The turn is a wholly-owned subsidiary of Singapore Technologies Aerospace (ST Notes will be issued by Rolls-Royce plc and guaranteed by Rolls-Royce Hold- Aerospace), the aerospace arm of ST Engineering. The purchase considera- ings plc, pursuant to Rule 144A and Regulation S under the U.S. Securities tion was arrived at after negotiations between the parties and taking into Act of 1933, as amended (the “Securities Act”). The transaction consists of consideration S-PRO’s past performance, its current profitability and future US$500,000,000 aggregate principal amount of 2.375% Notes due 2020 and growth prospects. S-PRO, based in Singapore, specialises in the repair and U.S. $1,000,000,000 aggregate principal amount of 3.625% Notes due 2025 and overhaul of aircraft landing gear systems and components. It had audited net is the debut issuance for the Rolls-Royce Group in this market. It is expected that assets of $24.4m as at 31 December 2014. This acquisition is the result of the the proceeds of the offering will be used for general corporate purposes and to shareholders’ ongoing review of the business strategy and focus for S-PRO. enhance liquidity. The issue is scheduled to close on October 14, 2015, subject The acquisition aligns with ST Aerospace’s strategy to develop its Singapore to customary conditions. It is expected that the Offering Memorandum in re- base as the centre of excellence for landing gear maintenance, repair and spect of the Notes will shortly be filed with the UK Listing Authority. overhaul. S-PRO has concurrently signed an agreement with Messier-Bugat- ti-Dowty to remain as an authorized service center for the latter’s landing gear installed on turboprops, helicopters and regional jets, as well as wheels, brakes and hydraulic components installed on various aircraft types. Apollo Aviation Group raises US$833m for SASOF III

Apollo Aviation Group (Apollo Aviation), a multi-strategy aviation investment manager, announced today that it has raised US$833m for SASOF III, its third Honeywell boosts aerospace portfolio with acquisition of Aviaso aviation fund. The amount raised is well in excess of SASOF III’s US$750m target. SASOF III, an institutionally-focused commingled private equity fund, Honeywell has acquired privately held Aviaso, an international aviation follows on from SASOF and SASOF II where Apollo Aviation raised US$213m software company that offers fuel efficiency and emissions savings- soft and US$593m, respectively in 2010 and 2013. SASOF III’s investors include ware to the airline industry. Terms of the deal are not being disclosed. Avia- a broad group of sophisticated governmental plans, insurance companies, so’s software products gather data on aircraft usage and identify and com- fund of funds, endowments and others. William Hoffman, Apollo Aviation’s municate the ways airline customers can save fuel consumption through Chairman commented, “As our largest fund yet, it is a testament to the suc- a simple, intuitive software interface. Fuel consumption can make up as cess of our strategy and confidence of our institutional investors. As with much as 20 to 40% of an airline’s operating costs, and even single-digit SASOF II, SASOF III will seek to acquire mid-life commercial aircraft and en- percent efficiency improvements can save airlines tens of millions of dol- gines for lease and / or immediate disassembly and resale of the systems, lars in fuel spending. Aviaso also provides software for emissions reporting components and parts.” SASOF III has already acquired 18 commercial as well as consulting and training for fuel efficiency and emissions manage- aircraft including three A319-100s, two A320-200s, three A321-200s, one ment. The company’s products and services will strengthen Honeywell’s A330-200, two A330-300s and seven B737-800s. Most of these aircraft are comprehensive services offerings, and take advantage of existing connec- on lease to a diversified group of airlines throughout the world, with the re- tivity, maintenance and flight plan operations businesses. mainder planned for sale or for disassembly and subsequent sale.

GE Aviation to create European Turboprop Center of Excellence Kaman to acquire Timken Alcor Aerospace Technologies to pursue non-U.S. options to secure export credit financing for customers Kaman has reported that its Aerospace segment has entered into an agree- ment to acquire Timken Alcor Aerospace Technologies, Inc. (TAAT) of Mesa, GE Aviation will create a turboprop engine development, test and pro- Arizona. TAAT designs and supplies aftermarket parts to support businesses duction operation in Europe. This will represent an investment exceeding conducting maintenance repair, and overhauls (MROs) in aerospace- mar US$400m and ultimately support 500 – 1,000 jobs. The turboprop industry kets primarily located in North America. Important factors in Kaman’s de- is highly global and comprised of many small aircraft operators. Among the

AviTrader MRO - October 2015 Finance News 15

factors driving GE Aviation to pursue the new operation in Europe is the and program discontinuance. The Company plans to close several facilities, need to support these and other international customers with financing consolidate certain product lines, and reduce headcount by approximately through government-sponsored Export Credit Agencies (ECAs). GE is cur- 450 employees. Total after-tax charges for the associated activities are- ex rently bidding on US$11bn of projects that require export financing. The pected to be approximately US$30m. “These initiatives are expected to re- U.S. remains the only major economy in the world without an Export Bank. duce costs and improve efficiencies which are necessary due to the slower Since the U.S. Export Import Bank (Ex-Im) authorization expired July 1st, GE revenue growth expected in 2015 and 2016. We expect our initiatives to has commenced talks with several foreign ECAs to secure financing for its offset inflationary pressures on wages, occupancy and infrastructure costs customers. GE Aviation will continue to expand its operations into coun- and enable us to continue to generate incremental year-over-year margin tries where critical Export Credit Agency financing is available for its global improvement,” said Amin J. Khoury, Executive Chairman of B/E Aerospace. customers. As with the U.S. Ex-Im Bank, many ECA countries have require- ments that production and jobs must be invested in-country to qualify for financing. For example, in Canada, GE Aviation has designated its Bromont facility as the Global Robotics Center of Excellence and will build out this fa- Air Partner delivers strong first half trading performance cility’s capabilities with additional investments in automation and advanced manufacturing technologies. Also in Canada, GE will expand its engine test- Air Partner has reported an encouraging performance for the six months to ing capability at its facility in Winnipeg, with US$23m in investments. This July 31st, 2015. Gross profit rose by 13% to £12.1m while underlying operat- includes enhancing its wind tunnel and test stands to support development ing profit and underlying profit before tax increased twofold to £2.2m. Re- testing for GE’s new large commercial engine, the GE9X. Additionally, in Bra- ported pre-tax profit rose by 70% to £1.9m after a charge £0.3m relating to zil, GE Aviation will invest US$55m to expand capability by building a new acquisitions. The underlying performance resulted from improved trading in engine test facility at its Celma location, supporting growth in assembly and the Commercial Jets division which increased its operating profit by 51% to overhauling of its commercial engines in airline service. “Right now, across £1.7m (2014: £1.1m), along with progress in both Private Jet and Freight divi- the entire company, GE has US$11bn in sales opportunities in the pipeline sions, which delivered operating profit of £0.9m and £0.4m respectively. The requiring ECA financing,” says David Joyce, President and CEO, GE Aviation. Group’s underlying basic earnings per share has increased by 26% to 17.1p, “The uncertainty around the Ex-Im Bank in the U.S. requires that companies lower than the increase in underlying pre-tax profits due to non-recurrence like GE create alternatives in order to compete internationally.” of last year’s tax credits. Non-JetCard cash has fallen by £4.7m to £1.4m. The two main factors behind this relate to working capital movements as a result of increased charter demand from some of its largest credit custom- ers, as well as acquisition investments and associated costs in the period. In B/E Aerospace to take US$30m after-tax charge in third quarter May 2015, Air Partner announced the acquisition of Cabot Aviation, a lead- ing global Aircraft Remarketing broker for a total net consideration of up to B/E Aerospace expects to recognize charges during the third quarter associ- £1.1m and, after the period end, it announced the acquisition of Baines Sim- ated with its cost reduction program. The charges reflect costs associated mons Limited, an Aviation Safety consultant, for a total net cash considera- with facilities consolidation, product rationalization, workforce reductions tion of up to £6.0m. At time of publication £1.00 = US$1.52.

Information Technology

Gogo, a leading provider of in-flight connectivity and entertainment solutions maintenance records, working in tandem with other Maintenance Performance to the global aero market, has announced a new 4G connectivity solution for Toolbox application solutions to increase efficiencies related to both day-to-day the business aviation market. Available at the beginning of 2017, Gogo Biz 4G airline maintenance operations and the management of leased airplanes. represents a significant increase in capability when compared to existing solu- tions. Created specifically for the business aviation market, Gogo Biz 4G is a Romanian aerospace company Romaero S.A. (Romaero) has chosen OA- specially-designed application of Gogo’s latest air-to-ground technology. The SES, the MRO IT system from engineering and maintenance systems expert, Gogo Biz 4G equipment package will incorporate dual-band 802.11ac Wi-Fi ser- Commsoft, to control its base maintenance activities. The system will enable vice and a host of other features – all from a single, lightweight box. Romaero to support third-party airlines and commercial operators from its location near Bucharest Baneasa Airport in Romania. Romaero has signed a AerData, provider of lease management, records management and engine fleet 40-concurrent users, five-year contract with Commsoft, with implementation planning software, has released that ACS Aero Management (Subsidiary of scheduled to start straight away. The contract covers five modules: Core, Pro- Aero Capital Solutions), has chosen AerData’s Corporate Management System duction, Materials, Commercial and Warranty. An agreement is also in place (CMS) software to support technical records management and technical audit to make additional modules available at a later date to help Romaero develop and inspection data management. AerData CMS is an industry-leading platform its business activities further. These additional modules include Line Mainte- that supports all business processes in aircraft leasing and asset management. nance, Continuing Airworthiness and Planning.

Boeing has introduced a digital records management capability to its Mainte- gate.control is an innovative procedure developed by Lufthansa Technik Lo- nance Performance Toolbox suite of products that will optimize maintenance gistik Services (LTLS), a subsidiary of Lufthansa Technik AG, to identify aircraft operations and reduce costs for airlines. The Maintenance Performance material in the international repair cycle. A patent has already been registered Toolbox Records module provides an industry standard platform to manage for the procedure and the gate.control box. The mobile box, measuring just one scanned and digitally produced maintenance and flight records. The new tool cubic meter in size, for the first time allows a comprehensive information pack- eliminates the operational challenge of managing cumbersome, paper-based age of the aircraft components being shipped to be compiled directly at the

AviTrader MRO - October 2015 Information Technology 16 customer site. The box is fitted with a camera system, associated IT equipment, Asia and South America signed strategic agreements for GEE’s electronic flight as well as scanners for generating comprehensive electronic photographic bag (EFB) solutions and certifications, providing a seamless migration path to documentation. Standardized software controls the data input from the scan- connected aircraft benefits and efficiencies. A growing number of airlines are ning of the documents, to the photographing of the packaging, through to the replacing their traditional pilot flight bags carrying cumbersome paper-based overview and detailed photographs and then transmits the data package to the flight documents with GEE’s navAero tablet-based electronic flight bag solu- responsible technical department in LTLS. Specially trained LTLS employees are tions, boosting operational productivity and improving the overall passenger responsible for carrying out the binding identity and quantity control and also experience. GEE’s proprietary navAero EFB equipment is now installed on more certificate checks. All data is finally input into the booking systems while the than 3,500 aircraft worldwide. Wizz Air, the largest low-cost carrier in Central documents created are sent back to the providers locally. and Eastern Europe, offering over 380 routes and 112 destinations across 38 countries in Europe and beyond, will begin installations of the navAero EFB tab- Southwest Airlines has selected GE’s Flight Efficiency Analytics to support let mounts on its A320 fleet later this year. Hong Kong Airlines, with flights across its fleet of nearly 700 Boeing 737 aircraft. GE will add analytics for a more its A320 and A330 fleets to nearly 30 cities throughout Asia, will utilize navAero’s comprehensive service with greater operational efficiency where GE already tablet mount hardware and EFB platform, including the new Apple iPad family provides Flight Operational Quality Assurance (eFOQA) analytics and crew re- holder for simultaneous iPad integration without STC changes. covery solutions to tackle airline optimization challenges across the business. In addition to providing Flight Data Management and Flight Operational Qual- The Qantas Group and GE Aviation have signed a comprehensive agreement ity Assurance services, GE Aviation’s Flight Analytics System will deliver their for GE’s Flight Efficiency Services, which will help Qantas and Jetstar increase Fuel Management Solution, which will include the evaluation and analysis of operational flexibility and fuel efficiency, and reduce carbon emissions by -draw flight and operational data to identify and prioritize fuel savings opportunities ing on GE’s navigation services, data and analytics expertise. The agreement in- and enable a platform for fuel management analytics. cludes flight efficiency and Flight Operations Quality Assurance (eFOQA) analyt- ics, as well as renewal of a long-standing relationship for the supply of Required Global Eagle Entertainment, a worldwide provider of aircraft connectivity sys- Navigation Performance (RNP) procedures across many airports in the Qantas tems, operations solutions and media content to the travel industry, announced network. The agreement will support one of the Asia-Pacific’s largest airline new deals with commercial airlines worldwide that puts mission-critical flight groupings, which includes Qantas, Qantas Freight, QantasLink and the Jetstar data at the fingertips of pilots and operations teams. Three airlines from Europe, Group, operating almost 300 aircraft to 85 destinations.

Other News

TRIGO Group has been awarded a contract by Airbus, and will provide com- industry and its customers. A new innovative, combined LTE-based ground prehensive inspection of aircraft cabin elements for the Pan-European air- network and satellite network delivers travelers in Europe the advantage of craft manufacturer for the upcoming years. Due to the continuous technical in-flight high-speed Internet access. Airlines will benefit from a cost-efficient and commercial improvement of air transport, as well as the liberalization of and future-proof connectivity solution. Deutsche Telekom and Inmarsat are the aviation sector, key players of aeronautics need to adapt themselves to a working together to develop the European Aviation Network seamlessly highly competitive business climate. In order to remain on the cutting edge, combining satellite connectivity from a new Inmarsat S-band satellite with aircraft manufacturers have to comply with zero-defect quality demands - an LTE-based ground network developed and run by Deutsche Telekom. not only from technical and safety aspects, but also on the production and Lufthansa will be the first European hub airline to capitalize on innovative assembly of cosmetic parts. Airbus issued a tender which TRIGO Qualitaire, connectivity services in the sky. In early summer 2016, Lufthansa will launch TRIGO Group’s Aerospace Business Line, has successfully competed in, and a state-of-the-art satellite-based broadband service on board its European gained commission to deliver comprehensive quality control solutions to flights, which is based on the recently launched technology provided by In- protect the conformity of Airbus’ cabin-assembly. marsat. Building on this strategic relationship, Lufthansa is committed to a flight trial program of the European Aviation Network from 2017 onwards. Universal Avionics Authorized Dealer, Heli-One, has completed installation of Universal Avionics UNS-1Fw Multi-Missions Management System (MMMS) Global aerospace integrator GA Telesis has signed a partnership agreement and MFD-640 Multi-Function Display on a CHC Helicopter Airbus Super Puma with military support services provider Horizon Shield Company. The ven- aircraft. With a Supplemental Type Certificate (STC) in hand, rotorcraft opera- ture will focus on developing business opportunities in the Kingdom of Saudi tors have a mission-ready flight deck solution. The UNS-1Fw MMMS provides Arabia. Connecting the commercial and defense aerospace expertise of GAT the operator with centralized control of the aircraft navigation sensors, lat- and the defense services expertise of Horizon, GAT and Horizon are expected eral and vertical flight guidance and steering, fuel management, database to become a key provider of services to several Saudi-based military and management and flight planning. It incorporates the advanced technology, commercial organizations including Saudi Arabian Airlines, Saudi Aerospace system design, features and capabilities included in the Universal Avionics Engineering Industries, the Royal Saudi Air Force, Royal Saudi Land Forces SBAS-enabled Flight Management System (FMS) with special interfaces and Aviation, Security Services Aviation, and Aramco Aviation. Prospective op- the ability to fly six distinct patterns. This installation includes a single UNS- portunities for the two companies include the establishment of a dedicated 1Fw MMMS with Localizer Performance with Vertical Guidance (LPV) Moni- spare parts support operation for the Royal Saudi Land Forces Aviation Com- tor in order to meet the integrity goals for precision approach types. mand and the Royal Saudi National Guard. Additionally, GAT and Horizon will work together exclusively to develop programs for the provision of an Deutsche Telekom and Inmarsat have announced a strategic partner- Advanced Aviation Forward Area Refueling System, as well as supply-chain ship bringing unprecedented passenger connectivity to Europe’s aviation development and asset management in the region.

AviTrader MRO - October 2015 YOU HANDLE THE ABSOLUTE ALTITUDE. WE’LL HANDLE THE ABSOLUTE COMMITMENT.

It’s simple enough: Trust matters. But when it comes to the maintenance of your fl eet, nothing matters more. That’s why you can count on the team at Delta TechOps. Our certifi ed, experienced technicians, as well as our customer service managers, are dedicated to keeping your planes in the air, time and time again. And with our Complete Fleet™ capabilities — including Airbus and Boeing airframes, 12 engine types, as well as component and line maintenance services — your aircraft always receives unparalleled service, for unparalleled reliability. And that’s a commitment we’re willing to make — absolutely.

Visit TechOpsMRO.com or call +1-404-773-5192 Cover story: Sustainable MRO 18

Achieving sustainable goals There is growing pressure to see more environmentally preferable practices in aircraft maintenance. Keith Mwanalushi looks at how the industry is identifying and responding to going green.

ast month aviation industry executives gath- ered in Geneva, Switzerland to call for gov- Lernments’ help to deliver the aviation indus- try’s climate goals. Various organisations signed up to an aviation industry-wide call for govern- ments to join with the sector and take action on climate change.

The aviation industry was also pushed to take en- vironmental responsibilities extremely seriously and to work harder to promote a sustainable fu- ture for the sector. The sheer nature of the MRO business means that it is susceptible to environ- mental controls and sustainability.

Over the last nine months for instance, Vector Aerospace Components Services in Perth (Scot- land) have made dramatic changes in the man- agement of their waste disposal methods and have now been recognised for achieving zero waste to landfill. Quite an incredible achieve- ment exceeding the targets of the Landfill Direc- Separating the waste that can be recycled is essential. Photo: Vector Aerospace tive 1999/31/EC and also Scotland’s Zero waste Plan. waste companies working along with the select- Taking into consideration that during the main- ed vendor, maximum benefits, with minimum ef- tenance process of an aircraft variety of hazard- A comprehensive review of waste arrangements fort and assurances of legal compliance became ous materials are used as well as disposed after unearthed potential savings of around 40%. apparent. service completion, planning in advance in order The review was driven by Pollution Prevention to minimise or eliminate the damage to the en- and Control (PPC) permit requirements and the vironment as well as airworthiness of the aircraft Waste (Scotland) regulations 2012 that came Iberia Maintenance has the Aenor ISO 14001 cer- should be key priorities. into force in January 2014. In order to simplify tificate for environmental management of its fa- the waste disposal process Vector Components cilities in Madrid. The company says it identifies considered the proposals from a number of and evaluates the environmental risks of every Zilvinas Lapinskas, CEO at FL Technics says all maintenance process to ensure control. “This works are planned from the start. “This allows is done in advance to minimise potential risks,” us to track hazardous waste and ensure their Iberia states. proper handling procedures. The requirements in the segment are very clear and FL Technics are Magnetic MRO in Estonia runs a risk analysis always looking not only to comply with local as programme on a regular basis that covers both well as international MDSDs, but also to perform environmental and labour safety aspects. “Par- even greener.” ticipants in the programme are elected from technical staff up to managerial positions,” says Over at GA Telesis Engine Services (GATES) the Risto Mäeots, COO at Magnetic. “The whole idea environmental analysis is based on the Plan-Do- is to get proposals and ideas up into the manag- Check-Act cycle. Basil Papayoti, President and er’s minds and work on solutions.” Director explains: “In the Plan stage, objectives and processes to meet them are defined. These The latest project on this topic at Magnetic was may be legal requirements or our own targets in cooperation with Tallinn University of Technol- to reduce the use of hazardous chemicals, emis- ogy where a series of chemical analyses within sions or waste. In the Do stage, the processes are different areas and workshops were performed. implemented.” “The outcome of this analysis gave us vital infor- mation about how to protect our staff, where we He said this includes choosing environmentally should look for safer alternatives and which type preferred products whenever possible, adding of filtration system is preferred around the facil- safety features and backups to process equip- Zilvinas Lapinskas, CEO of FL Technics ity,” Mäeots continues. ment and maintaining efficiency of shop equip-

AviTrader MRO - October 2015 Cover story: Sustainable MRO 19 ment and investing in new technologies. “In the Check stage, results are measured and compared to the objectives. In the Act stage, actions are taken to continually improve the process,” Pa- payoti reveals.

Manny Palomo, Director of Quality at GA Telesis Component Repair Group adds and describes that his unit performs two types of environmen- tal analysis: Firstly, the company identifies exist- ing hazard characteristics and EPA listed chemi- cals in the products purchased and the processes generating waste. “We then profile the waste streams as hazardous or non-hazardous and select the correct DOT approved storage con- tainer which we label and date accordingly. This process ensures we don’t dispose of hazardous waste incorrectly which prevents potential ac- cidents and possible environmental discharges.”

Secondly, he says GA Telesis selects the “most ecological friendly manner for disposal of waste,” for example recycling, fuels blending and incin- erations are GA Telesis’ first choices.

“We do not allow for our waste to be deep well in- jected,” Palomo asserts. “We also employ vendors that share our values and possess the technology and infrastructure to ensure that these company mandates are followed. GA Telesis also works diligently with our vendors to create engineering controls and use equipment that reduce or recycle hazardous waste. We currently recycle solvents like PRF 680 Type II, Acetone, and lacquer thinner on site, as well as skydrol. This is an effective way to reduce the impact on natural resources as well as minimise hazardous waste”, he adds.

Lufthansa Technik has an annual management review for continuous strategy reformation. The German MRO has three constant action fields of environmental strategy: Improved environ- HAECO employees are provided training on environmental sustainability.. Photo: HAECO Americas mental performance for customers, sustainable production processes and transformation to one all facilities. This report is reviewed with HAECO sis of environmental requirements for the MRO integrated and certified management system. Group leadership in Hong Kong with whom re- industry, Latimer reports that the Toxic Substance duction goals are established and measured. In Control Act of 1976 in the U.S. is currently being Across the pond in the Americas, HAECO sees addition, we solicit periodic reviews by outside revised and he anticipates additional restrictions environmental sustainability as a very important consulting agencies and utility supply companies on the use of certain materials currently used in element of HAECO’s operations, with significant which provide us with valuable input we then use aircraft maintenance. roots in the group-wide cul- ture of the parent company, “GA Telesis selects the most ecological friendly manner for Furthermore, require- Swire. ments from Regulation (EC) disposal of waste, for example recycling, fuels blending and 1907/2006 concerning the “For example we focus on incinerations are GA Telesis’ first choices.” Registration, Evaluation, Au- targeted reductions in the thorisation and Restriction of use of hazardous chemicals Manny Palomo, Director of Quality at GA Telesis Component Repair Group Chemicals (REACH) limit some wherever possible,” declares of the chemicals in products Dave Latimer, VP of Regulatory Compliance for in our ongoing sustainability efforts on a local fa- that are shipped to the European Union. HAECO Americas. “HAECO Americas completes cility basis,” Latimer explains to AviTrader MRO. an internal quarterly environmental assessment “This can create challenges as some products which details the usage of all chemicals across With regards to regulatory framework on the ba- used in aircraft maintenance, all of which are

AviTrader MRO - October 2015 Cover story: Sustainable MRO 20 recommended by the manufacturer or be de- termined equivalent to those recommended by the manufacturer, can sometimes conflict with REACH restrictions,” Latimer states.

In the MRO business the environmental regula- tions can become a challenge to manage if na- tional authorities have set the level high, but Mäeots from Magnetic MRO finds the standard EU regulations as not a major challenge. “Inter- estingly enough companies have taken the step forward and use environmental activities as a marketing tool – meaning they do more than authorities require. Certainly the most popular standard that is being followed is ISO 14001.”

In most of the EU countries local authorities re- quire ‘Project for emissions’ (this name differs from one country to another) before any activ- ity can be started. The aim is to understand the emissions impact to the surroundings and best measures to keep it minimal (e.g. determine fil- ter types corresponding to EN779). “There are environmentally friendly paints available, but Vendor selection for waste disposal is crucial at GA Telesis. Photo: GA Telesis airlines go for lower cost and therefore not the friendliest paint systems prevail – I think it is Blackbird says it is dedicated to providing its Hazardous waste as well as emissions and dis- matter of time when this will change,” Mäeots customers with eco-friendly plastic masking’s, charge can be generated from quite a wide range foresees. orbs and specialty tooling. The company also of aircraft maintenance and overhaul activities, offers a full line of free plastics bins to replace and therefore managing this process ‘cleanly’ is Aviation wheel and brakes specialists Blackbird any recycled inventory. All the removal is free, vital. At Iberia Maintenance, first of all, the com- has made significant investments in making the from small 10 gallon containers to 300+ gallon pany separates the waste coming from the main- aviation wheel and brake painting process lean receptacles. tenance repair shops and hangars before col- and aviation products sustainable with their re- lecting it. “The waste is taken to a ‘Clean Point’ usable paint masking kit systems and specialty Basil Papayoti contributes and says the biggest inside our maintenance area, where we carry out tooling. The MRO designed kits eliminates all challenge is the lack of coordination between a thorough segregation of the waste to separate waste and disposable tape expenses, meets OEM environmental and aviation authorities. “On the the waste that can be recycled,” says an Iberia specs detailed in the overhaul manuals, main- one hand, environmental regulations encourage spokesperson. tains product consistency while reducing injuries, the use of new environmentally friendly materi- workman compensation claims and overtime. als and technologies. On the other hand, aviation Lufthansa Technik also favours repair rather than safety requires that only thoroughly tested pro- dispose meaning that within the framework of cesses are used.” safety requirements aircraft components as well as instruments are always repaired if possible For example, Papayoti also refers to the REACH rather than replaced. programme. “REACH regulations in the EU re- strict the use of certain chemicals, even when Palomo advises that the best way to man- alternatives are not available. When alternative age emissions and discharges is to identify and products are available, only the type certificate eliminate the generation of waste in the process. holder can approve their use.” “We look for alternate methods and practices which provide an effective method reducing or Adequate training is also a key factor in environ- eliminating the generation of waste or harmful mental operations. LEAN philosophy is used by by-products. We use equipment such as baking FL Technics from technicians to managers and soda blasters, recycled plastic media designed to the company says it is constantly on the lookout reduce solid waste and harmful chemical fumes for possible ways to minimise waste in all of the from paint removal and paint application pro- company’s processes and services. cesses.”

“We train all of our employees as well as students Sustainable aviation is a long term strategy and of our technical training courses that we have to one that should tackle the challenge of ensuring abandon as much non-eco-friendly practices as a sustainable future for the industry despite the numerous challenges faced today. Latimer says employees are trained to make maximum use we can in order to minimise environmental dete- of unused products. Photo: HAECO Americas rioration as well as inefficiency,” says Lapinskas.

AviTrader MRO - October 2015 KEEP CALM AND CARRY ON GLOBAL LIVE AOG SERVICE 24/7/365 www.gatelesis.com Components 22

Talking components….. With AJW Group and Thomas Global Systems

AviTrader MRO: In terms of com- ponent repairs, how much influ- ence are new technologies such as additive manufacturing having on cost and operations?

Thomas Global: Currently, addi- tive manufacturing is extremely beneficial for the prototype and development stage of component manufacture. 3D printing can sig- nificantly reduce the build cost and time to market as the speed and ease which design mock ups can be produced is substantially better than traditional ‘subtrac- tive’ fabrication techniques. In some instances it has reduced the design cycle from years to months.

Furthermore, the ease with which modifications can be developed and trialled, especially complex assemblies, before going to mar- ket helps to reduce the start-up costs for MROs/PMA houses.

With regard to certification, sev- DER repairs have cost benefits Photo: AF KLM E&M eral components have received FAA approval although it is an area where the FAA is still developing guidance panding into component MRO, how are you As well as cost savings, there are other ben- for such manufacturing techniques. responding to this and do you see any benefits efits for operators choosing DER repairs using in developing your own DER repairs by using PMA parts. PMA parts often deliver product The advantage of certifying additive manu- PMA parts? improvements after the OEM’s initial systems factured components brings significant cost have been put into practice and trialled. PMA savings to operators and airlines as the manu- Thomas Global: DER repairs using PMA parts developers have the benefit of being able to facturing time and lead time (especially for give operators, airlines and lessors an alterna- observe the products being used and can see traditional complex assemblies) contributes to tive to OEM maintenance. The damaged com- where enhancements need to be made. PMA reducing overall inventory levels and TATs. ponent can be repaired rather than the whole developers can also learn from the major prob- unit being replaced which is the solution cur- lems that have previously been encountered Whilst not mainstream at the moment, an in- rently offered by many major OEMs and this with production and often have the advantage creasing trend in the coming years, will be to can be an unattractive option for operators of of newer materials and production processes. either replace obsolete/deficient components older fleets. (PMA), or develop new components for new Thomas Global Systems is also committed to airframes using additive manufacturing meth- Major OEMs tend to focus on customers with developing replacement parts for older compo- ods. larger fleets so operators of smaller fleets with nents to avoid obsolescence issues. In the avi- older aircraft can be left behind as it becomes onics sector, this is particularly relevant where AJW Group: Even though additive manufactur- evident that major OEMs do not have the time CRTs (Cathode Ray Tubes) are concerned and ing such as 3D printing have enabled repair au- or the enthusiasm to cater for both markets. Thomas Global Systems’ DER repairs for CRT thorities and organisations to produce certain This leaves a support gap and Thomas Global displays already serve this market. parts of the equipment at a competitive pric- Systems considers DER repairs using PMA parts ing, it is still not significant enough in terms of to be fundamental in developing solutions to Responding from a different angle, aside from scale and authorised repair or manufacturing satisfy these demands. DER repairs using PMA DER repairs and costly OEM upgrades, Thomas terms to really influence the market. parts also presents opportunities for further Global Systems has recently launched a suite cost savings as operators seek to drive down of LCD retrofit display solutions for commer- AviTrader MRO: OEMs are aggressively ex- maintenance costs. cial, regional and corporate aircraft cockpits.

AviTrader MRO - October 2015 Components 23

proven to offer the extra mile when it comes to com- petitiveness but at the same time until the lessors are able to accept DER or PMA components the majority of the airlines are deprived from such cost benefits.

AviTrader MRO: What role or impact are rotable items playing in the pooling of com- ponents and what impact does this have on the cost of rotables?

AJW Group: The cost of rota- bles obviously has an impact on the pool, however in any pooling concept the most important factor is the reli- ability of that pool not what dollar value you can buy ma- Retrofit display solutions are on the market Photo: Iberia terial at. A dollar value of equipment only indicates These upgrades give operators, owners and and specialist technology providers. By work- cost today but a reliability of pool gives an lessors an even greater choice, and facilitate ing together, these parties can jointly support overall lowest cost of ownership. greater maintenance economies. With current a greater market share with long term, cost lower fuel prices, maintenance now accounts effective solutions, while customers enjoy a AviTrader MRO: What is your overview on for a greater share of airlines’ expenditure so wider choice of service options, competitive component parts supply and demand for the maintenance programs are under even more pricing and the benefit of tried and trusted 737 and A320 in particular? scrutiny. Airlines and other operators are in- OEM endorsement. creasingly looking for innovative solutions AJW Group: In any platform, whether 737, from other avenues, rather than relying solely AJW Group: Competition and aggressiveness A320 or other, the majority of the time it is on major OEMs who may not be able to pro- is always good for the market. It ensures or around 50 single rotable units that are high vide the same cost effective support solutions shall we say enforces, the theory of Darwin in demand and the value of these equipment for their businesses. about survival of the fittest. As well as being could vary anywhere between 2k and 400k. aggressive one must deliver the products and Some areas of the MRO industry have seen services that meets the airline operators / OEMs combine forces with independent MROs MRO requirements. DER repairs have always

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AviTrader MRO - October 2015 Industry Interview 24

In the hot seat..... Keith Mwanalushi speaks to Kerry C. Mitchell, Assistant Director Business Development, PEMCO.

AviTrader MRO: What attracted you to this pleasure to work with; they business? know that when they come to us with a problem, we are Mitchell: When in high school, I had a sum- going to do everything to fix mer job at New Orleans Lakefront Airport. the issue. PEMCO is very cus- What I thought would be a boring summer job tomer-centric and we pride turned out to be anything but – it was incred- ourselves on being proactive ible. At the time, the airport was public and problem solvers. only served general aviation. The experience was the beginning of my interest in aviation. I AviTrader MRO: What are always knew that I didn’t want a boring profes- your current key capabilities sion; aviation has definitely brought me the ca- in terms of MRO work? reer I wanted, fast-paced with lots of problem solving, evolving technology and, of course, a Mitchell: PEMCO is on-line at workplace full of amazing co-workers. Tampa, FL (KTPA) encompass- ing two hangars of 360,000 Fast forward many years (not counting!), I was sq. ft., as well as back shops living in Lake Charles, LA. EADS and Northrop where we provide MRO ser- Grumman were establishing a joint venture vices for primarily narrow- MRO focusing on the expanding Airbus fleet in body aircraft. We perform the Americas and Chennault Airport’s location all levels of heavy checks, with available hangars and manpower made RON, line and AOG support the choice a natural. At the time, I was selling (both at TPA and other loca- contract labour man-hours to Northrop when tions through our PEMCO’s an opening became available in EADS’ Sales & AOG Team) as well as modi- Marketing department. Within a few years I fications (interior, avionics, was appointed to the Director of Sales. and structural); you name Kerry C. Mitchell, Assistant Director Business Development, PEMCO it, PEMCO can do it. Being at AviTrader MRO: What does a typical day’s work Tampa allows us to swap aircrafts at the ter- can vary and we are in a position to provide entail in your job? minal thereby saving customers costly ferry our expertise and support with minimal no- flight expenses, as well as easily moving ma- tice. Our AOG team is ready to respond within Mitchell: At PEMCO, I am responsible for busi- terials and people. hours of receiving a call. Equipped with tool- ness development as well as managing cus- boxes containing state-of-the-art equipment tomer contracts. These roles demand inter- AviTrader MRO: How is the narrow body cargo that can be checked as baggage response time action with customers whether on-site or at conversion business performing? is quite short as we understand the importance their home bases. My job is never boring or of being ready to go wherever and whenever monotonous; I truly never do the same thing Mitchell: The last few years have been out- required. two days in a row. It’s hectic and fast-paced standing in the B737 Classic conversion mar- which I enjoy tremendously. On any given day, ket and we expect 2016 to be no different. In AviTrader MRO: What is the market response I may be addressing issues that occurred the Tampa, we normally have two aircrafts in con- to PEMCO’s lease return aircraft maintenance night before, preparing a presentation detail- version at any given time with 2-3 in work si- services? ing PEMCO’s capabilities, working closure with multaneously at STAECO, our conversion part- our PTF customers or hopping on an airplane ners in China. PEMCO has numerous STCs and Mitchell: PEMCO provides lease return servic- to meet with customers. offers several conversion configurations (full es with transition support for the next opera- freighter, Quick Change or Combi) depend- tor on narrow-body aircraft. AviTrader MRO: What is the most challenging ing on a customer’s requirements. The typical part of your job? conversion is a 90-day span and frequently AviTrader MRO: What is your outlook for the longer as we normally accomplish a heavy Americas market for your business sectors? Mitchell: Many would say that the challenge check at the same time. is the multitasking, but I actually thrive on the Mitchell: PEMCO’s outlook for our core busi- challenges I face on the job. I excel at being AviTrader MRO: PEMCO is now working on ness is quite promising given the number of able to juggle multiple projects at varied stages Embraer EJets, what does this work entail? A320F and B737 / 757 and 767 operated in of completion. It is critical that I work closely the Americas. Ever expanding fleets and the with our customers and that I keep up with Mitchell: Most recently, PEMCO has supported potential outsourcing of maintenance from their aircraft status, whether in maintenance EJets by providing line and AOG support as promise a bright future particularly given our or conversion. Our customers are great and a well as structural repairs. Those requirements on-line location.

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Key battlegrounds in the aftermarket Analysis by David Stewart, VP and Global Managing Director – Aerospace and MRO– ICF International.

oday’s air transport MRO supply chain is occurring at this very time (see Chart One). ment and component asset management. They supports an active fleet of about 27,000 And this change is occurring at a time when air- have the advantage, long recognized and used Taircraft, effectively and safely, through lines are increasingly better focused on Return by the engine OEMs, to offer and win this sup- well proven and established players, processes on Capital Employed, and their core business. port at the point of the aircraft sale, locking in and channels. However, change is afoot. The long term revenue. aftermarket can no longer be an afterthought. These new aircraft, originally the A380 and It is (and has been for a while) a vital part of now in particular the 787 and A350XWB, have Thus, a new “aftermarket battleground” is be- the economic model for component and en- higher reliability components, generate lower ing established for the support of these new gine OEMs. Now it is a target for the aircraft man-hours and require increased technical aircraft. The key competitors (airframe and OEMs, in particular Airbus and Boeing. Why? sophistication to manage and repair. These component OEMs, airline MROs, the large There are many reasons but three suffice. changes make the business case for airlines to MRO integrators and independent MROs), First, it’s a potential source of long-term rev- conduct maintenance in-house much less at- need to understand what this means and how enue growth. Second, it’s a means to gather tractive and have become the catalyst for ena- to win and/or survive in this new campaign for and harness operational data that is vital for bling airlines to change their operating model market share. enhancing design and reliability, for products for maintenance delivery. Example switches today and for future platforms. Third, it ena- of behaviour include Japan Air Lines’ compo- In the view of this author and ICF, there are bles the OEMs to have more direct impact on nent MRO support for the 787, now provided three primary battlegrounds that will help de- the delivery of the reliability and maintenance by UTAS and LH Technik, and British Airways’ fine the winners and losers. Any aftermarket cost promises made for their aircraft. contracting with Airbus for the (non-engine) supplier will be in a strong position moving maintenance of its A380s. forward (with these new technology aircraft) if CONTEXT Why now? After all - from someone who has they can establish leading positions in control- been watching and advising in this sector for There is a new competitive dynamic in the af- ling/leveraging first, the operational data, sec- many years - this supply chain changes very termarket. Airbus and Boeing are effectively ond the workscope and third the assets. Con- slowly and very conservatively. The reason is “new entrants” as an integrator of mainte- trol of the data is critical to success in market simple yet unprecedented – the rapid ramp up nance support. They are offering a menu of participation and in gaining operational feed- and introduction of new technology aircraft that services that includes fleet technical manage- back for design and reliability improvement. Control of workscope is critical in driving parts choice and after- market margins. Control of the Aircraft deliveries (units) assets is vital in delivering and growing integrated service offer- 2.000 ings. Strong capability with re- gard to all three is key to driving 1.800 down cost and being competitive Mature Aircraft in the market. 1.600 These new aircraft generate mas- 1.400 sively more data and information that, if managed right, can move 1.200 the airlines and MRO suppliers New Generation into the realm of prognostics. The 1.000 tsunami of e-technologies dis- Aircraft cussed in ICF’s monthly article for Avitrader (February 2015) such as 800 Big Data and the Cloud are key en- ablers for this. However, except at 600 potentially the engine OEMs, the data processing business models 400 are unproven. Indeed, (some) pri- or attempts to gather and harness 200 data by the airframe OEMs such as Airbus’ MRO Network proved - unsustainable. 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Operators seldom have the scale Aircraft deliveries (units) Source: ICF International to derive the potential benefits

AviTrader MRO - October 2015

Source: ICF International

ICF International | icfi.com © ICF 2015 0 ICF Opinion 27

THE BATTLEGROUNDS from such data. So their key issue is how to de- rive value from the data that they own. OEMs The key battlegrounds and others are very adept at charging airlines and others for their IP, so why shouldn’t airlines get similar value and/or benefits? Who controls the Who controls As mentioned, the data processing business operational data? the workscope? models by aircraft and component OEMs are unproven. However, for sure, the aircraft OEMs believe that their scale and position in • Critical to success in • Critical to success in the market make them a natural middleman market participation driving parts choice and for such data aggregation and analysis. Large and in gaining aftermarket margins scale integrators such as AFI/KLM E&M and LH operational feedback Technik also have the potential to add value for design and Who controls in this domain as they have such significant reliability improvement the assets? operational experience. Hence ICF’s view that access to, control of and ability to leverage op- erational data is a key battleground. • Critical to success in growing integrated service market “Whoever controls the workscope controls the parts decision”. And it is the parts that drive The key battlegrounds Source: ICF International sector margin, whether for engine or compo- nent MRO - ICF estimates that parts account ICF International | icfi.com © ICF 2015 for more than 50% of the margin achieved 1 across the $60B air transport MRO market. It’s the associated operational and reliability data, of this article, there are 27,000 active aircraft a slice of this margin that is key for supply chain the first key battleground. in the fleet, most of which are mature and sup- participants, now including Airbus and Boeing. ported by a vibrant, competitive aftermarket Hence the latter pair’s focus on component/as- The engine MRO market and the success of where OEMs have less competitive advantage. set management support as core to their FHS/ engine OEM flying hour solutions offer clear With annual deliveries of circa 1,000-1,500 air- TSP and Goldcare services respectively. historical precedent and insight. Under these craft per year, the transition to a fleet dominat- contracts, the engine OEMs gain control of ed by these new technology aircraft will take a For non-OEMs, control of workscope is also vi- the fleet-wide data for engine health monitor- while. And by the way….when this eventually tal, as this enables the use of alternative parts ing and they have control of the workscope, happens, many of these aircraft will by then such as surplus or repairs, which in turn helps thereby for example eliminating the threat of be “mature” and likely available/accessible reduce costs and increase competitiveness. As PMA. And spare engine availability (the assets) to those who offer low-cost, competitive and evidence of the power/importance of control provides the engine OEM with a key competi- innovative service solutions. This is a phase of workscope, you only have to acknowledge tive edge. of aircraft maturity and a market where the the success of GE’s strategy against PMA as ex- independent MROs can thrive. The reported emplified by the TRUEngine programme. The unknown today is whether and how air- future demise of independent MROs may be frame and component OEMs will harness and over-rated. With regard to third battleground, control duplicate the engine OEMs proven business of assets, the last decade has seen signifi- model successfully. It is a certainty that they Yes, there’s new competitors and new bases cant growth in airline adoption of integrated will focus on and invest to win in these key bat- for competition in the aftermarket. That is a re- services from MROs. Signing up one or a few tlegrounds. And it is also a certainty that the ality. But this author believes that competition suppliers to manage (in particular) the thou- large airline MROs, who have long recognized for the customer is good, as it forces innova- sands of components on an aircraft on a flying and leveraged these sources of advantage, will tion in services and strategies. The key battle- hour basis significantly reduces internal costs engage vigorously to defend their strong mar- grounds and who wins in these vital areas will and investment needs/risk, and enhances cost ket position. help define how the future will look. predictability. Large scale suppliers have sig- nificant numbers of aircraft and inventory un- For smaller or independent MROs, and even der management, with resulting economies of component OEMs with narrow product scope, scale benefits for their customers. The greater the channels to market are changing for these ICF International provides objective, inde- the owned assets/assets under management, new aircraft types. Future growth and success pendent regulatory, technical, financial, and the lower the average inventory required per will depend on implementing strategies to par- commercial guidance to aviation clients, in- aircraft supported and the greater the pur- ticipate with each channel to market. cluding airlines, airports, financial institu- chasing power for parts and/or repair. That is, tions, manufacturers, U.S. federal agencies, owning and/or having control of such assets is And finally….. in this new, high technology international governments, VIPs, and heads central to the winning business model in this world, much has been said in the industry of state. valuable part of the market. Importantly and about the threat to the independent or small additionally, the more assets under manage- airline MRO. We all need to remember and rec- ment, the greater the opportunity to leverage ognize that, as mentioned in the first sentence www.icfi.com/aviation

AviTrader MRO - October 2015 People On The Move 28

thansa Technik Switzerland as the Head of VIP Project Management & Customer Service. In May 2013, Johannes joined the Comlux team in Indianapolis.

VAS Aero Services, a global leader in aviation logistics and aftermarket services, has named VAS’ Chief Commercial Officer and distinguished aviation industry executive Tommy Hughes as the Florida-based company’s new Chief Execu- tive Officer and shareholder. A prominent and longtime professional with decades of experi- ence in aviation and aerospace, Mr. Hughes joined VAS in 2007, leading the company’s Michael J. Sharp marketing and sales efforts through a period of AAR, a leading global aftermarket solutions unprecedented growth. During his tenure, the company that serves commercial aviation and VAS global logistics network has expanded to in- government customers worldwide, has an- clude marketing and sales offices in the United nounced that Michael J. Sharp has been ap- Kingdom - serving Europe, the Middle East and pointed to serve as the Company’s Chief Finan- Philippe Karam Africa, and Singapore - supporting the Asia- cial Officer, effective October 5th, 2015. Mr. Pacific region. In his new role, Mr. Hughes as- Sharp will replace John C. Fortson who is resign- Comlux America has announced the reinforce- sumes command of all business operations and ing and relocating to take a CFO position with a ment of its management team in Indianapolis responsibility for the company’s strategic vision non-aviation company. IN. On the procurement side, Comlux America and overall direction. is appointing Philippe Karam as Chief Procure- ment Officer. Philippe started his career in aviation in 2005 with Airbus, with a focus on procurement, transport logistics and contracts Vector Aerospace has hired two new regional administration. He joined Comlux in 2011 as VP sales managers to join the Vector rotary-wing Procurement for Fly Comlux division, based in sales team to grow business in both Asia and Europe. Regional Sales Manager, Asia – Lewis Ho was previously a Business Development and Sales Director for UTC Aerospace Systems Aero- structures Division selling reverse thrusters, py- lons and other polymer products for commer- cial and military fixed-wing aircraft. Regional Sales Manager, Europe – Matjaz Zaccaria was a former Customer Support and Service Manager for AgustaWestland Helicopters was the key ac- count manager for International and European offshore operators such as and Bel Air Aviation.

Jeff Lawrence

Macquarie AirFinance, a global aircraft leasing HAECO Americas reported that Jeff Lawrence company based in Dublin, Ireland, reported will join the company’s maintenance, repair and that Mr. Liam Kavanagh will be its new Execu- overhaul (MRO) leadership team as Vice Presi- tive Vice President, Chief Commercial Officer, dent of Planning, Pricing and Production Con- effective December 1st, 2015. Mr. Kavanagh trol. Jeff will assume responsibilities that have will take over from Harry Forsythe who will be been held by Lon Chaney, who has announced retiring from Macquarie AirFinance and leav- his plans to retire by the end of 2015. In his new Johannes Seeger ing San Francisco to return to his family home role, Jeff will focus on work underway to con- in Sydney, Australia. solidate planning and certain processes, includ- Zurich. On the Programs side, Johannes Seeger ing implementation of continuous improvement has been appointed as the Head of MRO Pro- initiatives, across the company’s operations in grams. Johannes started his aviation career 25 ways that will support ongoing quality and per- years ago in the German Air Force, followed formance for the company’s MRO customers. by Swiss International Airlines, and then Luf-

AviTrader MRO - October 2015