April 2014 - www.avitrader.com Training paradigm Assessing the challenges in emerging markets

Human factors in hanger development

Latest MRO News from around the world People on the Move latest appointments IBA Analysis Editor‘s Page 2 Marriage of convenience All roads led to Phoenix, Arizona for the MRO This leads to an even more interesting question: to valuation concerns.” Wencor Group however, Americas conference earlier in April where all How are the big MRO players responding to the just announced the acquisition of XTRA Aero- the big names (and smaller ones) where in full shortage in technical expertise in the ever grow- space in April, as an authorised Part 145 FAA and attendance. ing emerging markets in , Middle East, Latin EASA repair station, so we expect some interest- America and Africa? Our cover story partly looks ing developments there. Of particular interest is a comment made by Tony at whether partnerships with MROs in emerging McAnly, President of First Wave Aerospace short- markets can provide the solution, “such partner- Overall, various MRO providers that attended ly after the show. He said: “In the fragmented ships can lead to a win-win situation for both MRO Americas reported a strong start to 2014, MRO market, potential mergers, acquisitions and parties if certain issues are taken into account,” saying that their first quarter metrics either met partnerships should answer the question, ‘Do says Jens Lange from Technical Train- or exceeded their targets for the year. Some they drive down to save and MRO ing (LTT). See the full story in this issue. good news at last! centre’s money?’” An interesting point indeed. Elsewhere, there has been substantial specula- Happy reading! He added that companies that can achieve that tion about a potential acquisition of Wencor, goal will inevitably grow. First Wave, which is a the number two in the PMA market. According commercial aircraft parts distributor is capitalis- to industry analysts Canaccord Genuity, while Keith Mwanalushi ing on the trend to consolidate the fragmented the acquisition pipeline looks healthy, a deal for Editor MRO market. privately owned Wencor “appears unlikely due

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

Design

The deficit of qualified technical personnel is already a global issue Photo: LTT Volker Dannenmann, Layout & Design Email: [email protected] Mobile: +34 657 218706

Contents Advertising inquiries MRO and Production News ...... 4 Jenny Falk Head of Sales & Marketing Other News ...... 14 Email: [email protected] Cover Story: Training paradigm – Assessing the challenges in emerging markets . 16 Tel: +49 (0) 8761 346007 Finance News ...... 20 Registration Information Technology ...... 21 AviTrader MRO is a subscription-free monthly Airframes: Human factors in hanger development ...... 22 publication. To receive a copy in your inbox Industry Interview: In the hot seat... Amy Gowder, Vice President & General every month, please send an email with the subject “subscribe” to Manager, Lockheed Martin Commercial Engine Solutions ...... 24 oemmro@avitrader com IBA Analysis ...... 25 Opinion Hanger Development ...... 29 Please send your comments and queries to People on the Move ...... 31 [email protected]

AviTrader MRO - April 2014 www.afiklmem.com mobile.afiklmem.com

IN A CHANGING WORLD, TRUST THE ADAPTIVE ONE

ADAPTIVENESS® is our response to the changing Maintenance Repair Overhaul business environment. ADAPTIVENESS® means listening to and understanding the key technical priorities of your operations, building unique solutions meeting your specific requirements, and staying at your side as a partner to support you through your daily challenges in a spirit of continuous improvement. If, like many other airlines around the world, you are looking for efficient MRO solutions which lead to longer on-wing times, optimized MTBRs, and overall performance, ask us about ADAPTIVENESS®.

ADAPTIVENESS MRO and Production News 4

agreement, BAE Systems will provide proactive re- pairs that will improve the availability and reliabil- ity of Southwest’s fleet. BAE Systems will perform the services through FADEC International, its 50-50 joint venture with Sagem (Safran group). Through FADEC International, the two companies develop, manufacture, and support high-reliability aircraft electronics for harsh engine environments. The company serves airlines and and repair providers with a full range of aftermar- ket capabilities. Leveraging extensive knowledge of severe engine environments, FADEC design at- tributes, and repair history, BAE Systems has de- veloped a robust process that helps customers decrease costs, simplify maintenance, and enhance their services.

Ameco provides line maintenance for Etihad at Chengdu outstation Photo: Ameco Beijing , Air France Industries KLM Engi- neering & Maintenance extend 777 com- Ameco Beijing provides line maintenance doors, nozzle and engine mounts, along with Air- ponent services program for Etihad Airways at Chengdu outstation celle’s Papillon (butterfly) two-door thrust reverser. Interjet is based in City and currently oper- Boeing and Air France Industries KLM Engineering Ameco is providing line maintenance and releasing ates six Superjet 100s, with a total of 20 on order & Maintenance have ratified a long-term renewal service for Etihad Airways at Chengdu outstation and options for 10 more. of their joint 777 Component Services Program from April 5th, 2014. The UAE carrier is the third cus- (CSP). The extension of the CSP was announced tomer after Qatar Airways and for on the opening day of the MRO Americas confer- line maintenance service at Ameco’s Chengdu out- ence in Phoenix. The Component Services Program station. Etihad Airways operates daily on Abu Dhabi NORDAM and GECAS unit partner to offer is a parts-provisioning program that significantly to Chengdu route, using A330 aircraft. Last flight control parts for airlines reduces the ’s up-front investment in spare September, Ameco set up its seventh line mainte- parts and offers a quick and reliable supply of critical parts from a pool shared by participating 777 opera- nance outstation at Chengdu Shuangliu Internation- NORDAM and GE Capital Aviation Services’ (GECAS) tors. “Over the years, the Component al Airport, with Qatar Airways as the first customer. Asset Management Services unit announced a new Services Program has demonstrated its economic In December of 2013, Ameco opened its eighth out- cooperative initiative to provide airline customers competitiveness, reliability and excellent techni- station at Hangzhou International Airport. Now, the with enhanced options for flight controls. The part- cal quality,” said Bernard Hensey, vice president of Beijing-based MRO provider has eight outstations nership combines GECAS’ inventory of flight con- Fleet Management, Commercial Aviation Services, located at Shanghai, Guangzhou, Qingdao, Chong- trol parts from aircraft teardowns with NORDAM’s Boeing Commercial Airplanes. “We’re delighted to qing, Chengdu, Tianjin, Nanjing and Hangzhou, serv- strengths in component repair to offer airlines a renew a program that is a significant part of Boeing’s ing some 20 customers from international market. faster and lower‐ solution than repair of the commitment to delivering a competitive advantage customer’s part. “We can repair almost anything,” to customers in today’s complex aviation industry.” said NORDAM vice president of global marketing Bailey J. Siegfried, who also is responsible for the Aircelle to provide engine nacelle support firm’s rotable assets. “But it can take time, depend- services for Interjet’s Sukhoi Superjet 100 ing on the part condition. With GECAS’ inventory of jetliners spare parts, we can offer a quicker – and in some GEnx MRO network takes shape as pro- cases, lower‐cost – solution than repairing the cus- duction accelerates Aircelle (Safran) has signed a nacelle services con- tomer’s part.” The two companies will begin with tract with Interjet to provide support for the na- a focus on flight controls and plan to expand into The network of overhaul facilities for the GEnx en- celles and thrust reversers on this Mexican-based other components in the future. gine is expanding as production of the engine ac- airline’s fleet of Sukhoi Superjet 100 regional jetlin- celerates. In recent weeks, GE Aviation announced ers equipped with Powerjet SaM146 engines. Un- a GE-Branded Services Agreement (GBSA) with Air der terms of the four-year agreement, announced France-KLM for the maintenance, repair and over- at the MRO Americas 2014 conference in Phoenix, BAE Systems inks contract with Southwest haul of the GEnx-1B and a new joint venture with Arizona, Aircelle will provide access to large-sized Airlines to support world’s largest fleet of 737s Evergreen Aviation Technologies (EGAT) called GE nacelle components – including thrust reversers Evergreen Engine Services, which will provide MRO and engine cowls – for lease or exchange by Inter- has selected BAE Systems as services for both the GEnx-1B and -2B. Air France- jet. Aircelle has full design, production and integra- its exclusive provider of maintenance, repair, and KLM and GE Evergreen Engines Services join a net- tion responsibilities for nacelles on the twin-engine overhaul (MRO) services for the full authority work that includes GE Aviation overhaul facilities regional ’s PowerJet SaM146 engines. These digital engine controls (FADEC) on more than 450 in Prestwick, and Petropolis, . Other nacelles are composed of the air inlet, fan cowl 737 Next Generation aircraft. Under the five-year GEnx MRO partners include Abu Dhabi Aircraft

AviTrader MRO - April 2014 MRO and Production News 5

Tehnologies (ADAT), which received FAA and UAE HAECO ITM and Thai embark on aircraft General Civil Aviation Authority approval for quick component repair collaboration turn operations late last year and ultimately will be an overhaul facility for both the GEnx-1B and -2B; HAECO ITM (HXITM) and have embarked Lufthansa Technik, which has a GBSA for mainte- on a long-term collaborative initiative in aircraft com- nance, repair and overhaul of the GEnx-2B pow- ponent repair. Drawing on collective strengths, the ering the -8; and Air , which has a collaboration enhances product offering of the two GBSA for GEnx-1Bs. companies. Under the initial business collaboration framework, HXITM has identified a list of aircraft components that will be repaired at THAI’s technical facilities at Don Mueang Airport in . “We con- BAE Systems awarded EASA approval for tinuously seek to improve our supply chain in tandem TCAS 7.1 upgrade for and 757 with the expansion of our third-party Inventory Tech- models nical Management business,” said Richard Reed, Ex- ecutive General Manager of HXITM. “By working with a strategic supplier in the region like THAI, we are able BAE Systems Regional Aircraft has obtained Eu- to enhance the value proposition to our customers by ropean Aviation Safety Agency (EASA) approval optimising repair costs and cycle times and therefore to upgrade all previous TCAS 7.0 installations on offering better material availability through our pool Boeing 737s and Boeing 757s to the new TCAS 7.1 inventory in Hong Kong,” Mr. Reed added. standard, and has won business from three airlines. For retrofit aircraft this new standard is mandatory from December 1st, 2015, for all aircraft flying in European airspace. The TCAS 7.1 (Traffic Collision Alberto Pinto Interior for AMAC’s first Chinese customer and Avoidance System) approvals for BAE Systems Photo: AMAC B/E Aerospace wins cabin seating awards cover all models of the Boeing 737 from the Clas- from 7 major international airlines sic (Series 300-500) to the New Generation variants AMAC Aerospace to complete one ACJ (Series 600-900) and also all models of the Boeing A319 for first Chinese client B/E Aerospace has won first class, , and 757 (Series 200/300 and Boeing 757PF). This new main cabin seating awards from 7 major international development builds on the EASA approvals granted Switzerland-based AMAC Aerospace, a leading airlines. The awards are initially valued at approxi- last year for TCAS 7.1 upgrades to the BAe 146/Avro provider of corporate aviation maintenance and mately $600m and are for both new-buy and retrofit RJ regional jet and which has resulted in Swiss and completion services, has been awarded its first programs. The first quarter of 2014 will mark a quar- TNT Airways S.A purchasing the modification cover- completion contract from an Asian-based client. terly bookings record for the Company and a record ing their combined fleets of 36 aircraft. BAE Systems The aircraft, an ACJ A319 will undergo a complete for the most commercial aircraft seating awards in always intended that it would offer this upgrade so- nose to tail completion using designs provided any one quarter in the Company’s history. The seating lution to third party aircraft types as part of its busi- by world renowned interior designer Alberto programs will outfit B777 and B787, and A350, A380, ness development strategy and the Boeing 737/757 Pinto. The completion project is anticipated to and A319 aircraft. Amin J. Khoury, Founder, Chairman approvals are the first concrete steps in that direc- start in summer 2014 and will be re-delivered by and Chief Executive Officer of B/E Aerospace stated, tion. BAE Systems has so far received orders cover- Q2 2015. This will be the third A319 that AMAC “Today’s record multiple seating awards announce- ing upgrades for 60 Boeing 737/757 . The has worked on but only the first time it will have ment highlights our continued focus on innovation two latest customers to select the BAE Systems worked on behalf of an Asian client. The work and further solidifies our position as the market upgrade solution are Spanish carrier Alba Star for will be carried out at the EuroAirport Basel, Swit- leader for commercial aircraft seating for the airline its fleet and Swedish/UK freight zerland, in one of AMAC’s purpose built state-of- industry. These seating awards will drive first quarter carrier West Atlantic for its three Boeing 737-300Fs. the-art hangars. 2014 bookings to a record level for any quarter.”

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AJW signs multiple new contracts in April

VivaAerobus awards AJW Aviation eight repair agreement specifically covering a suite of isting fleet of nine aircraft, plus a planned expan- year PBH agreement for new fleet of fifty component across various platforms was signed sion to eleven this summer, will be covered within two A320s at MRO Americas in Phoenix on Tuesday April 8th. this agreement. As part of this contract, AJW will “Specialising in Boeing products, ATS is one of the base tailored spare parts inventories at numerous Mexican based low-cost airline VivaAerobus, has largest MRO organisations on the West Coast- of hubs which can be accessed as and when required, chosen AJW Aviation to provide component pow- fering both airframe maintenance and component illustrating AJW’s capacity to be flexible and adapt er-by-the-hour support for its fleet of fifty two fac- services. Our skills perfectly complement what to specific customer needs. In addition, SmartLynx tory-new A320 aircraft, including forty A320 NEOs. AJW Technique can offer through its Airbus special- will benefit from AJW’s excellent AOG coverage at Prior to the first deliveries from Airbus in 2015, ism and ensures that together we can truly drive almost all points of operation. VivaAerobus will have an additional six interim down direct maintenance costs for operators of A320s joining their fleet during 2014 and these also both aircraft types. This repairs agreement brings form part of the comprehensive contract with AJW. ATS’ competitive pricing, turn time and reliability to An extensive inventory of A320 components will be support AJW’s fleet under contract and we are very AJW Aviation signs CFM56-7 Fan Blade Ex- placed in Mexico at Monterrey, Cancun and Gua- pleased to announce this agreement in Phoenix” change agreement dalajara. AJW will also provide pool inventory sup- comments Michael Beck, Vice President & General port from its hub in – this strategic location Manager Components, Aviation Technical Services. AJW Aviation has signed a CFM56-7 fan blade ex- proving to be a vital part of the support network change agreement with Danish airline Primera Air. for VivaAerobus. Additionally, AJW Technique, the The five year agreement covers the airline’s en- AJW Group’s component MRO located in Montreal, tire fleet, consisting of six Boeing 737-800s and will underpin the service delivery with its specialist AJW Aviation signs new 5 year PBH-con- two 737-700s. Founded in 2003, Primera Air is Airbus repair and overhaul expertise. tract with SmartLynx headquartered in and offers flights to over seventy destinations worldwide. The AJW AJW Aviation has signed a five year contract with Fan Blade Set Exchange Service is part of a grow- SmartLynx, the Latvian based wet-lease and charter ing portfolio of engine repair management services AJW Aviation signs comprehensive repairs specialist. This new power by-the-hour agreement and benefits from the AJW Group’s worldwide lo- and consignment agreements with Avia- sees the relationship between AJW and SmartLynx gistics support. AJW delivers quick-turn engine fan tion Technical Services extending to 2019, following on from a successful blade solutions across multiple CFM56 platforms. five year PBH agreement signed in 2009. The Euro- Guaranteed fully overhauled, mapped and mo- In a move that complements the strategic part- pean airline provides full charter operation for its ment weighed, the exchange sets are ready to fit, nership that AJW Group has already established home markets of Latvia and Estonia and also wet with an additional advantage of a managed repair with Aviation Technical Services, a wide-ranging leases its fleet of A320-200 Airbus aircraft. The -ex service for the off-coming set.

Lufthansa Technik continues growth

Lufthansa Technik and Puerto Rico an- International Airport in Aguadilla, a former U.S. Air operation in respect to engine services which nounce new aircraft overhaul site on Island Force Base located on the northwest of the Island. now comprises the whole Boeing 737NG fleet. The Airport’s 11,700-foot runway and 3,900 acres The German company will look exclusively after Lufthansa Technik and the Commonwealth of of land makes it an ideal location for the new fa- the current 56 CFM56-7B engines of TVS’ entire Puerto Rico announced an agreement to create cility. The company will employ up to 400 work- rapidly growing 737NG fleet. The new contract, a new aviation maintenance, repair and overhaul ers and run a total of five overhaul lines. Initially which extends until the end of 2020, covers (“MRO”) facility in Puerto Rico, which will service it will operate two lines for Airbus A320 C-checks maintenance, repair and overhaul, logistics and short-haul and medium-haul aircraft. Agreements and D-checks. The first layover is due to take place on-site support by Lufthansa Technik’s Airline to this effect have now been signed with the gov- in 2015. Leader of the project is Elmar Lutter, who Support Team. ernment of Puerto Rico and the responsible port currently is Managing Director of the European authority and the company plans to start work overhaul facility Lufthansa Technik Budapest. in the next three months on the construction of the new facility. “We are very grateful to establish Lufthansa Technik and LIST found joint ven- with our partner a new overhaul facility in Puerto ture INAIRVATION Rico. Lufthansa Technik Puerto Rico will be a very important element in the long-term strategy of Lufthansa Technik and Travel Service are Lufthansa Technik AG and LIST components & Lufthansa Technik’s presence in the American strengthening cooperation for engine furniture GmbH have founded the joint venture market,” said August Wilhelm Henningsen, CEO services company INAIRVATION, in which each of the two of Lufthansa Technik. This is a major new step for companies holds a 50% stake. The new company Lufthansa Technik to expand its involvement in Travel Service a.s. (TVS), the largest airline in the combines the experience of Lufthansa Technik America. The new company, Lufthansa Technik Pu- Czech Republic, and Lufthansa Technik signed as one of the world’s leading providers of VIP erto Rico (LTPR), will be based at Rafael Hernández an enlargement of the already long lasting co- conversions and manufacturer of

AviTrader MRO - April 2014 MRO and Production News 8

in-flight entertainment electronics with the- ex tions for business and private jet cabins. Up to In the future when commissioned by a customer pertise of LIST as an internationally acclaimed now Lufthansa Technik has supplied the cabin the two companies will together implement in- and sought-after manufacturer of high-end cab- management system (in-flight entertainment novations that follow the theme of “Technology in interiors for private and business jets, luxury electronics) and LIST cabin components such as meets Cabin”, with the aim of blending enter- yachts, cruise liners and private residences. IN- galleys, armrests, fold-out tables etc. as inde- tainment electronics, furniture and lighting to- AIRVATION will offer innovative complete solu- pendent suppliers to the aircraft manufacturer. gether in an advanced design.

News from MTU Aero Engines and MTU Maintenance

MTU Maintenance signs contract with Saudi Aramco for maintenance of CF34- 8E engines

MTU Maintenance has signed a new contract with the Saudi Arabian Oil Company, Saudi Aramco for the maintenance and on-wing support services of its General Electric CF34-8E engines. The contract covers all engines powering Aramco’s Embraer ERJ-170 fleet and has a duration of five years. MTU Maintenance has been a reliable provider for the maintenance of Saudi Aramco’s CFM56-7B engines since 2003 and is pleased to enhance its growing partnership with this reputable company with the maintenance of its CF34-8E fleet. Saudi Aramco, officially known as Saudi Arabian Oil Company, operates its own fleet of more than 40 aircraft for passenger and cargo carriage as well as MTU Aero Engines, a technology leader in brush seals Photo: MTU medical evacuation and oil spill spraying.

seals will save around 1% of the, say, 20,000 tons through: As one of the first companies to use the of kerosene the jet typically burns every year – new technique, MTU produced components for MTU Aero Engines celebrates brush seal and that is the equivalent of the amount of fuel production engines this past May. These parts – manufacturing anniversary carried by ten tank trucks with a capacity of 20 borescope bosses for the PurePower PW1100G- tons each. Moreover, CO2 emissions are reduced JM engine, the Pratt & Whitney engine to power More than 30 years ago, MTU Aero Engines set by the same percentage as fuel consumption. the A320neo – are made by selective laser melt- out to develop its first brush seal. The innova- The latest example of applications that highlight ing, or SLM. The low-pressure turbine for the tive components are suitable for use not only MTU’s capabilities in the field of brush seals is PW1100G-JM geared (GTF) engine in aircraft engines – as, for example, in Pratt & the successful PurePower PW1000G series of will be the first turbine ever to come equipped Whitney’s successful family of PurePower geared geared turbofan (GTF) engines: MTU already with borescope bosses produced by additive –, but also in steam and gas turbines, contributes three brush seals each to the GTF manufacturing processes. The bosses form part pumps and a variety of other mechanical engi- engines to power Bombardier’s CSeries, Mitsubi- of the turbine case and allow the blading to be neering applications. MTU has established itself shi’s MRJ regional jet and Embraer’s E-Jets. Now inspected at specified intervals for wear and as a global leader in the field. The idea behind the company has been selected to also supply damage using a borescope. “We used to make the technology of brush seals is as simple as it its seals for the two additional GTF engine mod- these parts by casting or by milling them from is brilliant: “The construction typically includes els: both the PW1100G-JM engine to power the the solid,” explains Martens. Now they are be- thousands of thin bristles forming a very flex- A320neo aircraft and the PW1400G engine to ing manufactured by SLM. With this technique, ible seal which continuously adapts to the mov- power the Irkut MC-21 aircraft will incorporate a the first step is to slice up a 3D CAD model of the ing surface to be sealed,” explains Benjamin total of four MTU brush seals. component to be produced. A laser then builds Großkurth, who heads up brush seal production up the solid equivalent of the model layer by lay- at MTU. This way, brush seals clearly outperform er from a powdered material, the layer thickness conventional sealing systems, such as labyrinth being 20 to 40 micrometers. The powder par- seals. Says Großkurth: “MTU’s brush seals re- MTU Aero Engines produces parts by ad- ticles are locally melted and fused together. At duce leakages by up to 90%, which boosts the ditive manufacturing the moment, the borescope bosses are still be- performance of the engine or gas turbine.” Every ing produced in small quantities only. Things will increase in efficiency improves the eco-efficiency Additive manufacturing technology is rapidly be different from 2015 on: Once production of of a propulsion system, resulting in lower fuel spreading from one industry sector to the next. the PW1100G-JM engine to power the A320neo consumption and reduced CO2 emissions. Take a In the field of aero engine construction, - ramps up, MTU’s production volumes, too, will single-aisle aircraft, for example. The innovative based MTU Aero Engines has achieved a break- go up substantially.

AviTrader MRO - April 2014 MRO and Production News 9

GE Aviation and Evergreen form new venture for engine overhaul

GE Aviation and Evergreen Aviation Technologies announced formation of a new joint-venture com- pany specializing in the overhaul of the GEnx, the fastest-selling engine in GE Aviation history. The new company, GE Evergreen Engine Services, builds on more than 15 years of close cooperation be- tween GE Aviation and Evergreen. GE Aviation will begin providing training and tooling for GEnx later this year, and the facility will be able to perform lim- ited work on GEnx beginning in 2015 with full over- haul capability to follow by 2019. The GEnx engine family is the fastest-selling engine in GE Aviation’s history with more than 1,500 engines on order. The engine entered service in 2011 and powers both Signing of new joint-venture GE Evergreen Engine Services Photo: GE the and the Boeing 747-8. GE Aviation has been increasing production of the configuration of new airplane interiors. More than for Jet Aviation Basel, Switzerland. The manufac- engine for the last two years and will deliver nearly two dozen major interior configuration introduc- ture will be undertaken at 328’s Headquarters in 300 GEnx engines in 2014. tions are expected over the next two years. To help Oberpfaffenhofen, Germany with installation to 737 customers select among them, the studio pre- take place at Jet Aviation in Basel. The project work sents views of suppliers’ products side by side in which began in early March is due for completion one location. Customers can see, touch and expe- in summer 2014 for delivery to an undisclosed VVIP technics develops Sharklet retro- rience choices in galleys, seats and in-flight enter- private customer. This will mark the company’s fit capability tainment. They also can select interior colors and third galley project for Jet Aviation, reflecting their decors that highlight and support their brand. mutually strong commitment to quality, attention to detail and on time delivery. To complete the pro- Sabena technics develops its Sharklet retrofit ca- ject, 328 will construct the entire ‘U’ shaped rear pability. The Sharklets will allow fuel efficiency galley structure (which comprises two sides and a improvement, payload/range capability increase, bulkhead) from raw materials including assembly and environmental impact reduction thus bring- Telair delivers 400th lower deck cargo and mounting attachments to a high end custom- ing notable benefits to the customers’ operations. system for series ised specification. Based on the Original Equipment Constantly looking to improve aircraft operational Manufacturer (OEM) footprint, this complex will use, Sabena technics has already developed the ca- Telair International, a subsidiary of U.S.-based aero- feature high strength, lightweight materials. The pability to perform the production retrofit on shar- space and defense contractor AAR, announced deliv- electrical system and water services will be as- klet-ready wings on the Airbus A320 aircraft family ery of the 400th advanced lower deck cargo system sembled and installed by 328. Surfaces will feature and will be able to provide the In-service Sharklet to the Airbus fuselage production line in Hamburg. renowned Corian worktops and each side of the retrofit modification on the and A320 Telair has been a supplier of individual components galley will come equipped with a number of appli- aircraft. The installation of this value-adding tech- involved with cargo loading systems for the Airbus ances to include, steam ovens, microwave, refrig- nology will be carried out in Sabena technics’ facili- aircraft since the 1970’s and will become the single- erators, ice draws and coffee machines. ties in Bordeaux. Sabena technics is also consider- source supplier for the complete lower deck cargo ing the possibility of combining this modification handling systems for the Airbus A330-200 and -300 with scheduled base maintenance activities, cabin series of aircraft. The advanced cargo handling sys- reconfiguration and/or painting in order toopti- tem uses only one type of power drive unit (PDU) mize the aircraft grounding time and provide the to provide the required tractive force to move ULD’s Acro Aircraft Seating reports firm orders customers with an offer tailored to their needs. in and out of the aircraft and within the cargo hold into Q4 2014 to its final parking position. With currently more than 360 advanced systems in-service, the system UK-based passenger aircraft seat manufacturer has proven to be reliable. A similar system will be Acro Aircraft Seating reported a highly successful Boeing opens 737 interior configuration provided for the Airbus A350 XWB family of aircraft, 2013 and a very promising start to 2014. The com- studio extending Telair’s support of the Airbus fleet. pany announced firm orders into the fourth quarter of 2014 with recent confirmed orders for the ret- Boeing has debuted its new 737 Configuration rofitting of five Spirit Airlines’ Airbus A319 aircraft Studio, a new facility where airline customers can with its Superlight seat this spring and installation choose their jetliner interiors. The 20,000 ft² (1,900 328 secures contract to manufacture on 25 new A321 and A320 deliveries from 2015. m²) studio is located in Renton, Wash. near the galley complex for Jet Aviation The deal which was worth an estimated £6m marks factory where 42 737s are produced per month. the company’s second major US client and equates Similar to the 787 Dreamliner Gallery, the 737 Con- 328, the Germany-based refurbishment, comple- to 5000 economy class seats. With 35,000 seats figuration Studio provides a private and welcoming tions and maintenance aviation company and part currently flying, Acro Aircraft Seating anticipates showroom environment to assist Next-Generation of the 328 Group, has won a contract to manu- that it will double the number of seats in service 737 and 737 MAX customers with the design and facture an -600 rear galley complex within 18 months.

AviTrader MRO - April 2014 MRO and Production News 10

totals a compliment of over 500 employees by the year’s end.

Best Fly Maintenance opens part 145 Line Station in Luanda

Best Fly Maintenance will open a new part 145 Line Station at Luanda International Airport in the fourth quarter of 2014 to offer high quality main- tenance services. The new station will offer line maintenance tasks, scheduled and unscheduled maintenance checks for Gulfstream G450/550, Falcon 900, Falcon 7x or Beechcraft King Air fam- ily aircraft types. Overall, Best Fly will be qualified Fastjet of Tanzania signs contract with Aerostar for heavy maintenance on A319 Photo: Aerostar to work on more than 30 aircraft types.

Aerostar contracts with Fastjet for A319 AEI launches B737-800SF & B737-800C maintenance conversion programs Wesco Aircraft signs just-in-time- con Romanian aerospace company Aerostar has won Aeronautical Engineers has formally launched tract extension with GKN a contract from Tanzanian-based low-cost carrier both Passenger to Freighter and Passenger to Fastjet for the heavy maintenance of two of the Combi Conversion Programs for the Boeing 737- Wesco Aircraft Holdings, a provider of compre- airline’s fleet of three Airbus A319 airliners. The 800. Both programs have been studied for the hensive supply chain management services to first of the aircraft arrived at Aerostar’s Bacau past year and will be marketed as B737-800SF the global aerospace industry, announced the facility in February for its annual ‘C’ check and (Special Freighter) and B737-800C (Combina- extension of an existing just-in-time contract was redelivered on March 13, with the second tion Passenger and Freighter). The program de- with GKN Aerospace through December 31st, aircraft arriving at Bacau on March 14. This major velopment costs are being fully funded by AEI. 2017. The extension expands the number of new contract from one of Africa’s newest airlines The modification touch labor will be performed stock keeping units (“SKUs”) and the scope of the underscores the growing market reputation that at Commercial Jet’s Miami Florida facility, which services provided by Wesco Aircraft for GKN’s ac- Aerostar is building across Africa for the qual- is one of five authorized AEI Conversion Centers tivities in the United States and . “This -ex ity, cost-effectiveness and on time delivery of its worldwide. AEI will make both conversions avail- tension of Wesco Aircraft’s relationship with GKN MRO services. able at all authorized AEI Conversion Centers serves as an example of our ongoing efforts to shortly after issuance of the STC by the FAA and expand the Company’s relationships with long- expects the initial development and certification standing customers, by increasing the breadth to take two and a half to three years. After the and scope of our product offerings and providing Standex awarded contract from Senior initial FAA STC issuance, AEI plans to certify both additional value-added services,” said Wesco Air- Aerospace for Airbus A320 NEO aircraft conversion programs with the EASA, CAAC, ANAC craft’s Chairman, President and Chief Executive nacelle components and Russian authorities. Officer Randy Snyder.

Standex International Corporation (SXI) an- nounced that Spincraft, the Company’s engi- neered products metal fabrication business unit, Midair announces aircraft maintenance signs $60m deal for engine wiring has received a life of program award from Senior with Aircastle with Snecma Aerospace (SSP) to produce exhaust plug and noz- zle components for the nacelle on the Airbus A320 MidairUSA signed an aircraft maintenance agree- Fokker Elmo, part of Fokker Technologies, has NEO. The life of program award is based on active ment with Aircastle Advisor, which included the signed a contract with Snecma (Safran) valued production of both the A320 NEO aircraft and na- first in a series of lease return MRO services and at $60m for the delivery of Engine Build-up Units celle. Based on current orders and projections for a heavy C check. For over a decade Midair exclu- (EBU) electrical harnesses for the LEAP engine, the Aircraft and Nacelle annual sales will be an es- sively provided support for Airlines, a product of CFM International, a 50/50 joint timated value of $1.6m to $3m per year in 2016 Russia’s second largest carrier. The , New company between Snecma (Safran) and GE. The and 2017, increasing to a run rate of more than York/Melbourne, Florida based operations have LEAP engine was selected by Airbus for its A320 $7m annually at full production. Under the terms successfully maintained services for Transaero Neo, by Boeing as the exclusive power plant on of the agreement, Spincraft will produce exhaust aircraft, facilitating the sustainability and bolster- the 737 MAX and COMAC for the C919 aircraft plug and nozzle sets, consisting of five individual ing growth of the fleet from 3 to over 100- air models. To date, several thousands of orders components, for all the A320 NEO assembly’s pro- craft. Along with an increased operation in 2014 have been placed for LEAP engines. For Fokker duced by SSP. SSP production is anticipated to rep- at Melbourne, Florida that includes an 82,000 ft² Elmo the production activities will be related to resent up to 100% of the volume requirements on hangar project, Midair has secured several new several LEAP engine variants and work will start the UTAS Nacelle for the Pratt & Whitney engine contracts resulting in the hire of an additional immediately in Hoogerheide, the Netherlands, in version of the aircraft. 125 new employees within next six months. This close collaboration with Snecma.

AviTrader MRO - April 2014 Meticulous

MONARCH AIRCRAFT ENGINEERING (MAEL) has provided the highest quality aircraft maintenance and engineering services to and other blue-chip operators since 1967. And that was just the start. To handle the continuing growth of business from around the world, we’ve opened a state-of-the-art maintenance hangar in , UK. At 110,000 sq.ft it has the capacity to hold two Boeing 787 Dreamliners side by side, making it one of Europe’s largest aircraft engineering facilities. It is investment like this and the commitment of all our people which has propelled MAEL to the number one ranked Maintenance, Repair and Overhaul (MRO) in the UK. Being the very best is something we’re extremely meticulous about.

The standard for excellence

[email protected] | monarchaircraftengineering.com | +44(0)1582 398644 MRO and Production News 12

AFI KLM E&M confirms Dreamliner posi- ated by . The 12-year agreement tion will include rotable inventory power by the hour (PBH) support, heavy maintenance, and wheel has selected AFI KLM E&M to and brake services. AAR will utilize its broad provide component support services for a total services offering to provide this comprehensive of nine Boeing 787 Dreamliners currently on or- fleet support under a single program. To support der and scheduled for delivery between March the inventory PBH element of the program, AAR 2014 and end-2015. Billed power by the hour, will own and manage a rotable inventory pool in the contract also includes pool access and a five of Mesa’s locations to meet guaranteed ser- Main Base Kit pre-positioned at the client’s Nai- vice levels. The heavy maintenance will be per- Fokker and NLR sign LOI for composite manufacturing facil- robi base. formed in AAR’s Oklahoma City MRO facility and ity in Marknesse Photo: Fokker the wheel and brake services will be performed in AAR’s Miami location. The estimated total val- Fokker and NLR sign LOI for composite ue of the contract is more than $200m. manufacturing facility in Marknesse (NL) AAR to establish aviation supply chain Fokker Landing Gear (FLG), part of Fokker Tech- hub in Europe nologies and the Dutch National Aerospace HAITEC to invest around €30m at Hahn Laboratory (NLR) have signed a Letter of Intent AAR is acquiring inventory and customer con- Airport, Germany for the realization of highly automated and state- tracts from Sabena technics and expects of-the-art manufacturing facility for composite the transaction to close in the first week of April. HAITEC Aircraft Maintenance will invest around landing gear parts at the NLR in Marknesse (NL). The agreement includes ongoing power-by-the- €30m at Hahn Airport, Germany, within the The facility is scheduled to be up and running in hour support for 13 customers, which AAR’s next two years,” explains Michael Bock, CEO the third quarter of 2014 and will have a surface Aviation Supply Chain division will handle from and Managing Director of HAITEC Aircraft of around 500 m². About 20 Fokker specialists its new facility at the Brussels Airport. In addition Maintenance GmbH. This amount includes the will work together with the NLR team. This state- to supporting the customers that will transition purchase of the existing hangar 900, the con- of-the-art manufacturing facility will use, com- from Sabena technics, this 24/7 facility will sup- struction of a larger hangar with more than bine and further improve proven and available port AOG and other parts requirements for ex- 12,000 m² including offices and shops – ready manufacturing technology in support of FLG’s isting AAR customers in Europe, the Middle East for operation by the end of 2015 – as well as ambition to introduce its composite landing gear and Africa. In recent years, the U.S.-based com- the creation of around 120 new jobs. “This in- parts on new and existing landing gear designs mercial aviation and defense contractor has in- vestment is an important and necessary step and to ensure a reliable and repetitive manufac- creased its global supply chain infrastructure that for the long-term future of HAITEC within a turing process, reducing component costs under now includes operations in Chicago, Singapore, highly competitive global MRO market.” In ad- metal equivalents. The facility will produce com- Indianapolis, Toronto, and Brussels. dition to the aircraft maintenance activities, posite landing gear components for customers HAITEC will establish an EASA-PART 147 train- for the qualification and first production phase. ing organization in summer of 2014. “This of- The major advantages for the application of fer is not only for our employees. Any airline FLG’s composite technology on a landing gear Mesa Airlines and AAR sign LOI for total or MRO can send staff to Hahn”, states Frank for OEM’s and operators are affordability, weight support of new E175s Rott, COO at HAITEC. “We will also implement reduction (up to 30%), manufacturability, lower HAITEC Engineering Services in 2014 to pro- operational- and maintenance costs, low suscep- AAR has signed a letter of intent (LOI) to provide vide customers worldwide with our CAMO and tibility to damage and noise reduction. support for 30 new Embraer 175 aircraft oper- Lease Return services.”

Chromalloy completes first delivery of new components for Rolls-Royce Trent XWB aircraft engine production

Chromalloy delivered the first seal segment car- rier components to Rolls-Royce for the new Trent XWB aircraft engine. Chromalloy produced the components on schedule as part of a multi-year contract for the supply chain of the new Trent XWB engine – a next generation, fuel efficient power system scheduled to enter service in mid- 2014. The company is a long-time supplier to Rolls-Royce, providing repairs and services for the components found in the gas path or hot sec- tion of commercial and military aircraft engines. Contracts include services for the Trent and RB series engines, and others. HAITEC will invest around €30m at Hahn Airport Photo: HAITEC

AviTrader MRO - April 2014 MRO and Production News 13

TP Aerospace to provide long-term Wheel Flat Rate program for Star Air

TP Aerospace Leasing has been chosen by Dan- ish cargo airline Star Air to provide a long-term B767 Wheel Flat Rate (WFR) Program in support of its 12ea B767 aircraft currently in operation. Star Air, part of the A.P. Moller-Maersk Group is one of Europe’s premier cargo airlines. With TP Aerospace Leasing’s highly flexible, cost effec- tive and tailor made Component Maintenance, Pool Access, Onsite Lease Inventory and Logis- tics Program in place, Star Air will be able to up- hold its 99%+ on-time performance.

GMF AeroAsia reaches agreement with Sriwijaya Air and Honeywell First A320neo fuselage sections joined-up at Airbus’ A320 FAL in Toulouse, France Photo: Airbus GMF AeroAsia has reached an agreement with Airbus starts final assembly of best-sell- officially initiated the expansion on March Sriwijaya Air and Honeywell International to ing A320neo 18th, with a ground-breaking event and an- support the wheel and brake maintenance of ticipates completion in 2015. The expanded the B737-NG and B737-Classic of Sriwijaya Air. Airbus has started final assembly of the first facility is expected to employ more than 115 The two year partnership is worth US$2.0m. A320neo at its Final Assembly Line (FAL) in people, a 30% increase over its current work- In this agreement, Honeywell as the Original Toulouse (France), with the join-up of the for- force. The additional capacity will enable PPG Equipment Manufacturer (OEM) will produce ward and aft fuselage sections which recently to meet increasing demand for its coatings by original equipments for both B737-NG and arrived from St. Nazaire in France and Hamburg automotive OEM, protective and marine, pack- B737-Classic aircrafts. One of the equipments is in Germany respectively. Once this phase is aging and industrial customers in Mexico. The wheel and brake. Meanwhile Sriwijaya Air has completed, the next stage is the wing to fuse- expansion project will incorporate eco-friendly special privileges in obtaining materials from lage join-up. Overall it takes about one month building designs, provide natural light in em- OEM. These privileges are then entrusted to to complete the final assembly of an A320 Fam- ployee areas, use intelligent lighting systems GMF as maintenance provider of its aircraft to ily aircraft. On average, every seven hours an to maximize energy efficiency and incorporate obtain wheel and brake materials from OEM. “ A320 Family aircraft leaves one of the three water recycling capabilities. This model of cooperation becomes an appeal- A320 Family FAL’s in Toulouse, Hamburg, or ing breakthrough for GMF, Sriwijaya Air and Tianjin. The A320neo first flight will take place Honeywell,” said Agus Sulistyono. in Q4 2014 and first delivery in Q4 2015. The A320neo “new engine option” incorporates mark delivery of first many innovations, including latest generation airplane featuring galleys from Turkish engines and large Sharklet wing-tip devices, Cabin Interiors Kelly Aviation Center renamed to Lock- which together deliver 15 percent in fuel sav- heed Martin Commercial Engine Solu- ings and a reduction of 3,600 tonnes of C02 Boeing and Turkish Airlines are marking the tions per aircraft per year. With a total of more than delivery of the first commercial airplane – a 2,600 orders received from 50 customers since Next-Generation 737-800 – outfitted with gal- Kelly Aviation Center, a leading provider of - air its launch in 2010, the A320neo Family has cap- leys manufactured by Turkish Cabin Interiors craft engine maintenance, repair, and overhaul tured some 60 percent of the market, clearly (TCI). Turkish Airlines will receive nine more for international commercial and military cus- demonstrating its leadership. 737s this year equipped with TCI galleys. TCI tomers, has changed its name to Lockheed Mar- is the first Turkish aerospace manufacturing tin Commercial Engine Solutions (LMCES). “Since company to design, manufacture and certify 1999, we have been proud to be Lockheed Mar- products for the aerospace market, paving the tin’s only MRO service provider,” said PPG to invest $27m in San Juan del Rio way for ongoing development of aerospace Amy Gowder, vice president and general man- facility capabilities in Turkey. Boeing has been assist- ager of LMCES. “Over the past three years, our ing TCI in the development of airplane interior legacy of improving on-wing performance for the PPG Industries announced plans to invest products since shortly after the company was military has grown to include commercial cus- more than $27m in its San Juan del Rio, Que- founded through the joint effort of Turkish Air- tomers. We believe our new name reflects that retaro, Mexico, coatings manufacturing facil- lines, Turkish Aerospace Industries and Turkish growth.” Another major reason to change the ity. The expansion project will add four new Technic. With this milestone, TCI brings add- company’s name was the acquisition of a second buildings to the current complex, representing ed capacity and capability to the global sup- engine MRO facility in Montreal in 2013 that ex- approximately 100,000 ft² of additional pro- ply chain as commercial airplane production panded the company’s customer base into addi- duction and laboratory space. The company ramps up. tional international markets.

AviTrader MRO - April 2014 MRO and Production News 14

Luxair selects Bruce Aerospace LED cabin OEM supplied fluorescent cabin lighting fixtures fixtures was easily accomplished using the exist- lighting for sidewall and ceiling lighting which enhance the cabin with the environmen- ing wiring and controls. With an LED life of over for B737-700 fleet tally friendly and cost effective Bruce Aerospace 60,000 hours, will save costs on labour LED fixtures. Certification being achieved by the & materials for lamp replacement, not to men- Bruce Aerospace has added Luxair to its grow- existing STC, which covers the fitment of new tion savings on disposal of “hazardous lamps”. ing list of customers for its popular XLume sidewall lights with lenses in neutral white and Additionally, the aircraft will burn less fuel due B737NG LED Lighting product line. The first in- ceiling lights with the bi-colour option of blue to the weight savings and reduced power con- stallation took place on 25th November 2013, & white. In addition, Bruce will supply LED sumption of the LED fixtures. at the Luxair facility in Luxembourg and the air- plug & play lights solutions including; forward craft is now in commercial service. The product and rear entry lights, reading lights and NSFSB line offers airlines a drop-in replacement for the signs. The installation of the “plug & play” LED

Other News

FLYplug, a new label-based format for aerospace RFID parts identification, Amur Finance Company has entered into a 50/50 joint venture between has been launched by MAINtag in partnership with Zebra Technologies. AFC and the owners of Jet Midwest to form Amur JMW Aviation (AJM- FLYplug is easy to use, cost-efficient and practical for aircraft (A/C) manu- WA). As a culmination of a mutually beneficial relationship, AJMWA will facturers, original equipment manufacturers (OEM) and MRO sectors that combine the technical expertise currently offered by Jet Midwest with the want to upgrade from older barcode identification labels or name plates to a financial expertise offered by Amur Finance Company — providing efficient state-of-the-art, data-robust RFID tagging system. The FLYplug RFID printing fleet solutions through a network of partner companies. Mostafiz ShahMo- solution includes software license, Zebra Technologies RFID printers (RZ400, hammed, founder and CEO of AFC, and Paul Kraus, founder and CEO of Jet RZ600 and R110Xi4 series as well as the new ZT410R and ZT430R) and MAIN- Midwest, will serve as Co-Chairs of the Board for the newly formed AJMWA. tag’s on-metal ruggedized flexible FLYchip-embedded RFID tags. This new sys- tem sets a standard that outperforms existing on-metal identification. Based on MAINtag’s patented on-metal RFID label (firm-plate) technology, FLYplug Honeywell and Safran have signed a memorandum of understanding (MOU) is a global integrated printing/encoding enterprise package solution based on with GoAir, one of India’s leading low-cost carriers, to support the advance- ATA Spec 2000. It is the logical stand-alone and networkable solution for fast, ment of the EGTS electric taxiing system, a technology that can save airlines fully automated and cost-efficient printing/marking and encoding of RFID- up to 4% block fuel consumption per flight. EGTS uses electric motors on the integrated labels. main landing gear to enable the aircraft to push back autonomously and taxi without using its main engines to improve operational efficiency and reduce emissions. The news follows an agreement with Airbus in December to jointly AkzoNobel Aerospace Coatings announced Boeing qualification of the evaluate EGTS as an option for the company’s A320 family of airplanes. Under Aerodur 3001/ 3002 Base Coat/Clear Coat system. The newly approved Aero- the agreement, GoAir will provide data on its taxiing operations to Honeywell dur Base Coat/Clear Coat system is qualified by Boeing to both the BMS 10- and Safran to assist in maturing the system and to define the precise fuel 72, Type 10 and BMS 10-125, Type 4 specifications and is applicable for use on and other operational benefits it would see by using the technology across all Boeing legacy models (777, 747, 737, 767) under BMS 10-72 as well as the its fleets. The agreement will also see GoAir assist in establishing the airline Hybrid Laminar Flow areas of 787-9 model aircraft per BMS 10-125. To date, standard operational procedures for aircraft equipped with the system. Aerodur 3001/3002 Base Coat/Clear Coat has been applied to well over three hundred new and repainted aircraft. Comlux America, the completion and service center of the Comlux Group, located in Indianapolis, IN, launched a new Supplemental Type Certificate Thales, a leader in Air Traffic Management, will supply theU.S. Federal Avi- (STC) project on the Bombardier Challenger CL-600 series. The STC pro- ation Administration (FAA) with an initial five Instrument Landing Systems ject installs and certifies the equipment required for operation in airspace model 420 (ILS420s) for deployment throughout the U.S. National Airspace requiring Cockpit/Pilot Data Link Communications (CPDLC). The system in- System (NAS). This order is the first procurement in a five-year contract. The corporates equipment from Universal Avionics Systems Corporation (UASC), ILS420 will provide precise vertical and horizontal navigation guidance to pi- International Communications Group (ICG), and L-3 Aviation Recorders. The lots for smooth, safe approach and landing. The system is the most advanced launching customer of this brand-new system has selected Comlux America ILS on the market today, surpassing the requirements of the FAA and Inter- to perform the installation in the early spring of 2014. national Civil Aviation Organization (ICAO) for Category III operations.

Gogo, a leader of in-flight connectivity and a pioneer in wireless in-flight digi- Panasonic Avionics will double the size of its connectivity-equipped fleet by tal entertainment solutions, has received an STC from the FAA and certifica- the end of 2014 following FAA certification of a bird strike compliant radome for tion from JCAB (Japanese Civil Aviation Bureau) to install its Ku-satellite based B777-200 aircraft. The STC (supplemental type certificate) for the B777-200 ra- connectivity service on Airlines’ 777-200 aircraft. The two certifications dome paves the way for approvals on other aircraft types. Panasonic currently are key milestones that pave the way for launching service on JAL. Gogo has has more than 150 B777-200 aircraft scheduled for installation, and further STC partnered with JAL to install connectivity service and Gogo Vision – Gogo’s approvals are expected in April for the B757, and for the B767 in September. wireless in-flight entertainment service – on JAL’s entire domestic fleet.

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www.vas.aero Cover Story: Training paradigm – Assessing the challenges in emerging markets 16

Training paradigm – Assessing the challenges in emerging markets Analysis by Keith Mwanalushi The rapidly developing emerging markets are fuelling the massive investment in current and future air- craft deliveries putting pressure on MRO services. The challenge now is whether there will be enough technical expertise to meet the growing demand. AviTrader MRO finds out.

The migration of technical experts from African carriers to other regions is a major problem in Africa Photo: Aerostar

According to a recent study by TeamSAI, the glob- dle Eastern airlines will need over 2,600 new air- vironment and the aviation industry down turn. al U$56.2 billion MRO market will grow to U$76 craft over the next 20 years, 60% or more of which billion in the coming decade and most of this will be used for fleet expansion. Consequently, “The GCC has witnessed a sharp shortage of growth will be driven by Asia, which is expected experts believe the region’s MRO market will need staff that is currently being met with imported to be the largest MRO market by 2023. about 53,700 new technicians to fuel that growth. staff from the rest of the Middle East and Asia.” Mr Fattaleh continues by anticipating that as In Brazil alone the total domestic RPKs have nearly With that in mind it’s worth asking if the provi- airlines in Asia and within the GCC continue to doubled from 44 million in 2007 to 87 billion in sion and delivery of aircraft engineering and grow; such a shortage will become more acute. 2012. According to various sources, over the next maintenance training in the Middle East region is “If this is not addressed, it will greatly affect the 10 years air traffic in the region is expected to in- keeping up with the growth in the industry, and ability of the MRO’s in the region to meet the crease by an average of 7% annually, which would will this be a problem in the future? maintenance demand and will force a migration put Latin America on about the same growth tra- of maintenance activities to other regions,” Fat- jectory as . Nevertheless, according to IATA, Osama Fattaleh, CEO at Jordan Aircraft Mainte- telah warns. currently the Middle Eastern airlines are carrying nance Limited - JorAMCo says it’s important to two times more passengers than those in Latin split the region into two segments. “The GCC on Such changes of the industry’s geography have a America, despite the considerably smaller market. the one hand has witnessed a large increase in direct impact on the entire MRO segment, espe- the number of aircraft driven by both the nation- cially as concerns the concentration of providers The increased consumer spending and a new al carriers of Saudi, the UAE and Qatar as well as in relevant regions. Kestutis Volungevicius, the middle class on the rise in Africa on the back of a low cost carriers in Saudi and the UAE.” Head of FL Technics Training in Lithuania agrees long-term economic growth rate are also expect- that the demand for MRO services in Asia and ed to catalyse aviation growth on that continent On the other hand he notes that the national car- the Middle East markets will rapidly increase. in the years to come. riers within the rest of the Middle East have been downsizing and shirking their fleets as a result “Naturally, this will attract more attention from Statistics from various sources indicate that Mid- of the political instability, general economic en- the global providers,” comments Mr Volunge-

AviTrader MRO - April 2014 Cover Story: Training paradigm – Assessing the challenges in emerging markets 17 vicius. “Therefore, we can await a significant number of new, progressive players to emerge in the global MRO arena. They are the ones who are likely to dictate global trends in the near future.”

Moreover, he adds that it will have a strong effect on training providers as well. “The deficit of qual- ified technical personnel is already a global issue, and with the developments in the emerging re- gions, it will only become worse,”Volungevicius predicts.

Jens Lange, Head of Product Management Ba- sic Training at Lufthansa Technical Training (LTT) observes that due to the fact that there are not enough qualified technicians available in these emerging regions, they are currently imported from Europe or elsewhere, and provide for a high cost burden for the MRO industry in the emerg- ing regions. This can be seen in the Middle East in particular.

“The question is, is there enough training capac- ity in local colleges and schools to produce that Partnerships should respect local expertise Photo: JorAMCo. amount of needed specialists?” Lange asks. He stresses that the need to be attractive to the are needed and therefore, good training that are not recognised by the relevant education au- young generation in the field of maintenance is reflects these needs is required,” Lange explains. thorities in many Middle Eastern countries. prerequisite. “Bearing in mind that our culture “The GCC on the one hand has witnessed a large values academic degrees from Once these new aircraft des- increase in the number of aircraft driven by both universities this means that good tined for the emerging countries students tend to shy away from become due for their first base the national carriers of Saudi, the UAE and Qatar such programmes irrespective of maintenance visit, this too may as well as low cost carriers in Saudi and the UAE.” how enthusiastic they are about present some challenges as a Osama Fattaleh, CEO at Jordan Aircraft Maintenance Limited - JorAMCo aviation,” Fattaleh notes. larger workforce will be required according to Mr Lange. However, attracting fresh talent into the aircraft “Having said that, there are a few universities in engineering and maintenance profession is much the Middle East which offer aviation maintenance “For base maintenance you do not need the high- easier said than done - particularly in specific re- degree programmes but those are not many, and est qualification, but the best skills to repair and gions. In the Middle Eastern context, Osama Fat- have to establish sustainable links with the avia- overhaul the airliner. Also it is important to find taleh believes that firstly, it’s a culture problem. tion industry across the region,” he adds. the right people with the correct behaviour and attitude. Teamwork, good skills and knowledge “The Middle Eastern mind set still values four- When asked what more needs to be done in the year college degrees in the scientific fields over Middle East region to ensure that the next gener- the technical education that is required for air- ation of aircraft engineers and maintenance per- craft maintenance. Further partnerships be- sonnel are trained to handle the most up-to-date tween universities and aircraft maintenance aircraft, Fattaleh believes continuation training academies can be one of the solutions to resolve should be taken seriously with more technologi- this issue’” Mr Fattaleh suggests. cally advanced aircraft and to increase the op- portunities for work experience and on-the-job He further observes that only those who work in training. the field of aviation maintenance recognise the value of this business, “and it’s very clear the lack As in many other regions, Mr Volungevicius from of awareness amongst the youth and their advi- FLT Training sees the main issue as being the ab- sors when it comes to the aviation field and to sence of a common strategy among the manu- aircraft maintenance specifically.” facturers, governmental institutions, airlines and MROs with regards to the ways of promoting the Fattaleh reports that the cost to study aviation profession. engineering/maintenance is high compared to Jens Lange, Head of Product Management Basic Training other fields especially in government subsidised He says only upon making it more attractive in at Lufthansa Technical Training universities. He says most aviation certificates the job market and the introduction of special-

AviTrader MRO - April 2014 Cover Story: Training paradigm – Assessing the challenges in emerging markets 18 ised governmental training programmes can the industry expect to meet the rising demand fuelled by the expanding industry. “Moreover, local aviation authorities have to make it their priority to encourage the experienced training providers who are in a position to help in the process of improving regulations and assist the regional players to enter the regional markets,” Volungevicius advises.

Lino Sanchez, Head of Maintenance Training at Maintenance is of the opinion that the lack of enough qualified technicians in these re- gions could be that the economic development of these emerging countries has far surpassed their forecast.

“The air transport industry is closely linked to the economic situation in these countries. Probably, the air transport industry has grown faster than the infrastructure needed to support it, such as Mr Volungevicius, sees an absence of a common strategy Photo: FL Technics Training training centre facilities, human resources and au- thority approvals to achieve the minimum number Mr Lange from LTT is convinced that such part- Airlines and aviation associations in markets of needed qualified technicians,” says Sanchez. nerships can lead to a win-win situation for both such as Africa have expressed concern about parties if certain issues are taken into account. the rapid brain drain the continent is experi- He says it’s necessary to respect the local envi- encing and the few skilled technicians available The creation of joint ventures between well- ronment and all processes and organisational are heading for ‘greener pastures’ in developed established MRO organisations and local firms requirements must be localised. “Let the people markets. in emerging countries might seem like a logical learn the business. Start a learning phase to bring solution in the nearer term but there are always the relevant people to knowledge, and then to questions about who really benefits from such In a global market however one cannot totally competence.” ventures. eliminate the migration of personnel to other countries or companies. “That said, attracting Lange continues: “Also, respect the experience qualified workforce from abroad is still only a of the established companies. In the beginning short-term solution, as it doesn’t solve the global it makes sense to send the relevant people to shortage of qualified workforce,” says Volunge- the established facilities to get the experience of vicius. the workflow and processes. Accompanying pro- cesses like job card engineering, material supply He then looks closely at the African scenario - “It and others should be done by the experienced is a rapidly growing region with a huge potential company. Added value is created for both parties and it is only a matter of time until it achieves when the work share is split in some fields.” such an environment which would make it un- necessary for the local specialists to look for Kestutis Volungevicius agrees that joint ven- work abroad. This is why the main emphasis tures can be beneficial for both sides involved. should be placed on promoting the profession “As concerns well-established MRO players, they and improving the existing regulations,” Volun- are provided with an opportunity to enter and gevicius asserts. strengthen their presence in the new attractive markets. In turn, he says regional firms can gain He suggests that this will increase and sustain the first-hand access to the newest technologies as local pull of qualified workforce and, in the long well as the necessary knowledge base.” term, create favourable conditions for attracting international training organisations to the region. However, he stresses the importance of choosing “These, in turn, will facilitate the growth of lo- the right partners who would enable local compa- cal training providers and improve their training nies to grow both, technologically and knowledge- capabilities. Otherwise, the currently observed wise, and would not merely dictate their own global headhunting will only raise the global la- rules. “Only such partnerships, based on mutual bour costs,” he adds. respect, will allow local organisations to gradually become truly international. Otherwise, there is a Naturally, creating the necessary environment for chance of becoming a mere means for the glob- the development of such capabilities isn’t some- An immediate task force is needed to address the issue of man al players to increase their market share in the thing that can be achieved overnight, but it’s one power in the Middle East says Mr Fattaleh Photo: JorAMCo. emerging regions,” Volungevicius points out. step further to overcoming the challenges.

AviTrader MRO - April 2014 Simplifying Complex Engine and Airframe Component Services STS Component Solutions leverages Quantum MRO & Logistics software to transform its aftermarket operations The Challenge The immense complexity of engine inventory, and sales. The Lot Costing and aircraft component services at module consolidates management STS Component Solutions comprises of acquisition of inventory lots, the background processes for sourcing, purchase, teardown and sale of teardown, disposition, cost, logistics, engine and airframe components, sales, support and detailed regulatory and selling inventory consign- data management for global engine ments. To expedite online parts and airframe parts distribution services. To further streamline sales, STS uses Quantum’s Parts operations, STS wanted to move from Search App module to list updated inventory and receive RFQs through STS Component Solutions using disparate systems for accounting and ERP, into a modern solution that their website in real-time 24/7. STS Component Solutions, a division of STS Aviation Group, supports some of the largest would integrate business processes “A significant benefit of Quantum passenger and freight airlines and MROs in the across their division to become more is found when business processes efficient and responsive to their world by providing dedicated support teams are structured around the Quantum for each region, and marketing our aircraft customer needs. database, giving us a business intel- components and services world-wide. STS The Solution ligence environment for maximizing Aviation Group is a diversified company that Designed specifically for aviation our understanding of operational data specializes in support services for the aerospace aftermarket services, STS selected industry through its four divisions: on-call Component Control’s Quantum and while continuously optimizing and scheduled line maintenance through STS MRO & Logistics software to meet productivity,” said Nick Chambers, Line Maintenance; inventory solutions for Vice President of Operations at STS airframe and engine components through its accounting, ERP and Lot Costing STS Component Solutions; aerospace specific integration needs and allow for Component Solutions. staffing services through STS AeroStaff Services; expansion over time to encompass and, Engineering Support including 24x7 DER more integrated capabilities. With services through STS Engineering Solutions. the Quantum accounting module, compliance, auditability and quality control requirements are incorpo- rated into simplified processes to better manage customer accounts, www.componentcontrol.com www.stsaviationgroup.com Finance News 20

Héroux-Devtek announces amended and restated credit ing level meant that, despite the collective agreement pay increase agreement valid from August 2013 and rising expenses for pensions and staff reduction measures, personnel costs remained largely the same at Héroux-Devtek, a leading Canadian manufacturer of aerospace prod- €1.2bn euros. At €99m, other depreciation, amortization and impair- ucts, has reached an agreement with a syndicate of banks to amend ment losses also remained largely at the previous year’s levels. Other and restate its existing Credit Facility. Under the terms of the agree- operating expenses declined slightly to €610m (- 0.8%) owing mainly ment, the Facility has been extended for a three-year period with a to currency effects. new maturity date set for March 16, 2019. The authorized amount has been increased from $150m to $200m, while the Facility could also be increased by an additional amount of $75m, subject to lenders’ consent. This Facility will be used for working capital, capital expendi- AFI KLM E&M acquires 100% of Barfield from Sabena tures and other general corporate purposes of Héroux-Devtek and its subsidiaries, including acquisitions. This Facility will be secured by all Air France Industries KLM Engineering & Maintenance (AFI KLM E&M) assets of the Corporation and its subsidiaries, and will be subject to and Sabena technics have reached an agreement under which the certain restrictive covenants and corporate guarantees granted by the Franco-Dutch group will take full control of Barfield, the North Ameri- Corporation and its subsidiaries. can subsidiary of Sabena technics. The transaction should be finalized in the first half of 2014, subject to regulatory approval. Barfield was founded in 1945 and is an MRO provider specializing in component support, offering services ranging from repairs to flight-hour solutions Precision Castparts Corp. expands aerostructures capabili- including spares support, the design of test equipment, and the dis- ties with acquisition of Aerospace Dynamics International tribution of spare parts for OEMs. It employs 230 at three US facilities (Miami, Phoenix, Louisville). Franck Terner, Executive Vice President Precision Castparts Corp. has agreed to acquire Aerospace Dynam- AIR FRANCE KLM Engineering & Maintenance, said: “This acquisition ics International (ADI) from The Marvin Group for $625m. ADI is one supplements and strengthens our presence on the world’s biggest of the premier suppliers in the aerospace industry, operating a wide aviation market – a strategic region due to its dynamism and poten- range of high-speed machining centers. ADI has developed particular tial for growth. Because of the complementary nature of AMG and expertise in large complex components, hard metal machining, and Barfield, two Florida-based subsidiaries, the clients of AFI KLM E&M critical assemblies. The company has strong positions across high and Barfield in the Americas will benefit from a comprehensive array growth commercial platforms, including a significant presence on the of high-quality, competitive services on their doorstep.” Airbus A350. ADI operates from one site in Valencia, California, and employs approximately 625 people. Subject to regulatory approvals, the transaction is expected to be completed during the first quarter of fiscal 2015, after which its results will be reported as part of the JetBlue to sell LiveTV subsidiary to Thales Group Airframe Products segment. JetBlue Airways has agreed to sell its wholly owned subsidiary LiveTV to Thales Group for $400m. The sale which is subject to regulatory and other approvals is expected to be completed in mid-2014. LiveTV Lufthansa Techniks’ good result creates foundation for in- is a leading provider of live in-flight entertainment and connectivity vestment systems for commercial airlines. In 2013, LiveTV and its partner Via- Sat introduced Ka-band satellite-driven onboard connectivity, a game Lufthansa Technik Group’s 4.2% increase in revenue to €4.2bn in 2013 changing technological advancement. Concurrent with the closing of was characterized by stable business development within the Luf- this transaction, JetBlue will enter into long term agreements with thansa Group and an increase in business with external customers, LiveTV to continue providing support for its live TV and inflight con- whose share of the total revenue rose by 1.7% to reach 62.2%. The nectivity product, Fly-Fi. operating result improved considerably, climbing by 23.2% to €404m, with an operating margin of 10.9%. “In addition to the good order situation, it was above all the significant cost reductions resulting from the SCORE program’s measures that made our excellent result Textron completes acquisition of Beechcraft in 2013 possible,” said Dr. Peter Jansen, CFO of Lufthansa Technik AG on March 18 in Hamburg. “We were able to respond to the high price Textron has closed its acquisition of Beech Holdings, LLC, the parent of and cost pressures in the market with a reduction in unit costs, more Beechcraft Corporation, and that it will bring together its Cessna busi- efficient administration, the restructuring of our network and numer- ness and Beechcraft to form a new segment called Textron Aviation. ous individual measures. On this basis, we will further improve the Cessna and Beechcraft together produced about $4.6bn in revenues competitiveness of the Lufthansa Technik Group through the intro- during 2013. The acquisition brings together three iconic brands, each duction of new aircraft types and state-of-the-art technologies and pioneering many of general aviation’s most notable advances in the the focused continuation of our SCORE program.” Total operating ex- past century. Cessna, Beechcraft and Hawker bring 200-plus years of penses grew by 2.5% to €4.0bn. Due to a higher volume of modifica- combined aviation experience to the market and an installed custom- tions and the overall increase in VIP and engine business, the cost of er base of more than 250,000 airplanes worldwide. Going forward, materials increased by 5.2% to €2.1bn. The company’s reduced staff- Textron Aviation intends to share and leverage best practices across

AviTrader MRO - April 2014 Finance News 21

all operations to further its position as an aviation authority. Scott est fleets in the industry with an average owned aircraft age of less Ernest, who has served as Cessna’s President and CEO since 2011, will than four years. BOC Aviation placed a new order for 25 Airbus A320 lead the Textron Aviation segment as CEO. family aircraft. The Company finished the year with a commitment to purchase 114 aircraft through to 2019.

BOC Aviation reports 2013 net profit of US$277m Wencor Group announces acquisition of XTRA Aerospace BOC Aviation achieved a record net profit after tax in 2013, marking an unbroken run of 20 years of profitability since it was founded in No- Wencor Group announced the acquisition of XTRA Aerospace. As an vember 1993. For the financial year ended 31st December 2013, the authorized Part 145 FAA and EASA repair station, XTRA Aerospace is Company earned US$277m in net profit after tax, 23% higher than the a leading provider of specialized repair services for a wide variety of previous year. Total assets were US$10.2bn, rising 12% from US$9.1bn electrical and mechanical systems across in-production commercial at the end of 2012. BOC Aviation ended the year with US$501m in un- aircraft. XTRA Aerospace further augments Wencor Group’s electrical encumbered cash and US$2.3bn in unutilized committed credit facili- repair capabilities as it specializes in electrical components through- ties. In 2013, BOC Aviation took delivery of 48 new aircraft, and sold out the cockpit and interior of commercial aircraft. This strategic com- 21 owned aircraft. The year-end portfolio comprised 226 aircraft, of bination will enable XTRA to leverage Wencor Group’s PMA and DER which 206 were owned and 20 were managed, in service with 56 air- capabilities in order to bring additional savings to its broad base of lines in 31 countries worldwide. The Company has one of the young- airline and MRO customers.

Information Technology

Panasonic Avionics Corporation, a leader in in-flight entertainment Gogo released that its business aviation group, Aircell, has unveiled and communications (IFEC) systems, will deliver its industry-leading the ST 4300 – a new in-flight communications system for business eX3 in-flight entertainment and communications solution to Air Can- aircraft. The ST 4300 combines voice, narrowband data and cock- ada for 37 wide body aircraft. Under terms of the agreement, Pana- pit data link services into a single unit. Available with one, two or sonic will linefit install eX3 on Air Canada’s 37 Boeing 787 Dreamliner three Iridium voice/narrowband data channels, plus one dedicated aircraft. Deliveries commence with the airline’s first 787 aircraft in Iridium data channel, the system allows business aircraft operators Spring 2014. Air Canada currently has five Boeing 777-300 aircraft to configure cabin and flight deck communications based on their equipped with Panasonic’s eX2 system. specific needs and budgets. It provides global service coverage – on the ground and in the air, at all altitudes and latitudes – including the An A380 line-fitted with broadband in-flight connectivity service polar regions. In the future, the ST 4300 is expected to be eligible for from Panasonic Avionics Corporation (Panasonic) has been deliv- FANS (Future Air Navigation System) certification. FANS technologies ered to Lufthansa. The A380, was fitted at Airbus with Panasonic’s allow flight crews and air traffic controllers to exchange safety-sen- Global Communications Services. Over the next twelve months, Pa- sitive flight information – such as clearances, requests and position nasonic will equip an additional 11 linefit A380s with its global con- reporting – via digital data link. This capability is becoming manda- nectivity service. tory in a growing number of world regions.

AerData, the provider of software and services for the aviation in- has licensed the AirVault Records Management So- dustry announced that Minsheng Financial Leasing (MSFL) the lution as its new, web-based record management system for aircraft Chinese-based financial leasing company has chosen AerData’s CMS maintenance and business operations. This solution will provide an software. CMS (Corporate Management System) is a leading lease innovative, cloud-computing method to manage the airline’s aircraft and asset management solution used by the majority of the world’s maintenance records to increase efficiency for its growing fleet of aircraft, helicopter and engine leasing organizations. Airbus A319s and A320s, while enhancing safety and compliance. Further, the AirVault Cloud Computing Service platform will manage Corendon Dutch Airlines has selected Flight Focus to provide a wire- other business records applications for the airline including finance, less in-flight entertainment system for its fleet of Boeing 737-800 legal, and human resources. aircraft. The airline will be the first European charter operator to offer wireless in-flight entertainment across their entire fleet. The Ramco Systems, a global Aviation Software provider, announced solution will enhance the passenger experience by providing enter- the successful go-live of Ramco Aviation version 5.6, at Columbia tainment, information and shopping through the passengers’ own Helicopters (CHI), the world leader in commercial heavy-lift helicop- personal electronic device whilst opening up new ancillary revenue ter operations. CHI is one of the first customers of Ramco Aviation opportunities for the airline. The Flight Focus solution that Coren- who have been using the series 3 for more than a decade. With this don will deploy comprises Flight Focus’s own FFP-2 Server and NGA upgrade, CHI is on the latest and state-of-the-art version of Ramco Wireless Access Points that together have been proven capable of Solution v5.6. CHI is now using the fully integrated suite of Ramco streaming video to every passenger simultaneously on both narrow Aviation including Finance & 3rd party MRO, Offline Maintenance and wide-body aircraft. System, Time & Attendance and Advanced Reporting.

AviTrader MRO - April 2014 Airframes 22

Narrow bodies put increased demand for modernisation

Along with the steady recovery of the avia- tion industry worldwide, the MRO business is naturally expected to hold fairly steady in 2014. This also applies to the airframe MRO segment. The statistics from various sources suggest that the largest amount of works in the segment are to be conducted on the Air- bus A320, closely followed by the Boeing 737 family. In the meantime, the scope of services to be delivered on these aircraft should reach $7 billion, divided almost equally between Air- bus’ products (about $3.5 billion) and Boeing’s machines (about $3.4 billion).

For instance, Timco Aviation Services reports that currently the narrow body MRO accounts for about 70% of their workload and is mostly divided between A320s and B737s. AAR Corp. have also stated that in 2013 approximately a fifth of almost 5 million man-hours spent in their facilities were dedicated to services for B737s with a similar amount of hours spent on servicing the most popular Airbus models.

Such statistics should raise no eyebrows, since the fleet of these aircraft is one of the largest around the globe. Low cost carriers are par- ticularly fond of these models, and their or- ders just keep getting larger: this year alone almost 1100 new aircraft are to be delivered Narrow bodies such as the 737 are pushing demand for modification solutions Photo: Boeing globally (with almost 60% of them being nar- row bodies). surprise that such work currently accounts for well. Timco, for instance, has recently opened about 7% of the entire MRO market. a whole new maintenance facility in order to However, while the works conducted on these provide services for such aircraft as Embraer two families are expected to account for almost Since most carriers are fully satisfied with the ERJ145 and E170/E190 as well as Bombardier 75% of the entire airframe MRO segment, the performance of the B737 and A320 families, CRJ200/700/900 with an added focus on refur- value of C-to-D check-related services planned one should expect the share of these aircraft bishment and modernisation. to be conducted on the aircraft is expected to to grow globally. “However, as the competi- sum up to only $1 million. According to indus- tion rises, airlines typically try to make the In addition, while in the past carriers tended try experts, this is so because a large share of most of their aircraft by investing into inte- to order short-term one type-oriented mod- the forecasted segment growth should be at- rior refurbishment works in order to raise the ernisation programmes, today more and more tributed to the rising demand for various refur- comfort standards to modern levels,” says airlines opt for programs tailored for the entire bishment services. Andrius Norkevicius, the COO of FL Technics fleet. ‘The preferences of the airline custom- Engineering. ers have a considerable effect on the demand Some experts forecast that in 2014 the size of as well. For instance, many passengers who the aircraft modernisation-related MRO will used to fly first or business class are gradually “This naturally raises the demand for the im- grow by around 10%. Their beliefs are largely switching to economy, thus forcing the provid- plementation of on-board entertainment sys- based on the increasing necessity to grow com- ers to raise their comfort standards. petitiveness through fleet unification (espe- tems and Wi-Fi systems. Moreover, as the fuel prices are still very high, various fuel-saving cially among the merged airlines), the develop- “Considering this trend accompanied by the solutions are becoming increasingly popular. ment of on-board entertainment services and demand for weight-reduction and the intro- For instance, wingtips can offer 1-2% addition- the growing need for on-board Wi-Fi systems. duction of such new services as mixed class al fuel-efficiency. Such trends have naturally Moreover, carriers worldwide are still strug- seats, the pressure on the segment will only changed the workload of the MRO providers gling to cut down on operating expenses. This increase,” concludes Norkevicius. forces them to consider such options as weight accordingly.” reduction, which can be achieved through cabin modifications and the implementation Some of the providers report that the same can Source: Avia Solution Group of lighter materials. Therefore, there is no be said about the regional aircraft operators as

AviTrader MRO - April 2014 INTELLIGENTLY DEFINING AVIATION ™

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In the hot seat..... Keith Mwanalushi speaks to Amy Gowder, Vice President & General Manager, Lockheed Martin Commercial Engine Solutions.

AviTrader MRO: What attracted you to this AviTrader MRO: Kelly Aviation Center is now business? Lockheed Martin Commercial Engine Solutions. What necessitated this rebranding? Gowder: As a child, my first dream job was to be an astronaut. So aerospace has intrigued me Gowder: Expanding internationally and broad- from a young age. As a consultant, I worked with ening our commercial customer base drove this a variety of high tech clients. But, aerospace is decision. Lockheed Martin is recognised around special. The technology, innovation, importance the world. The brand stands for quality, integrity, of the work and passion of all involved are in- technology leadership and customer focus. This spiring and rewarding. brand is the epitome of what we value and de- liver to our customers. With such a strong brand AviTrader MRO: What does a typical day’s work it is a waste of energy and resources to go by an- entail in your job? other name and have to explain the connection.

Gowder: Quite a range, but my day starts with a AviTrader MRO: You opened a new engine main- customer focus--updates from our customer ser- tenance facility in Montreal Canada last year. vice representatives, dialogues on new pursuits What opportunities does this investment bring? or refining an offering. Continuous improve- ment is a passion, so my day always incudes an Gowder: First and foremost a very capable, ex- operational discussion around a structured im- perienced workforce with a long commercial his- Amy Gowder, Vice President & General Manager, Lockheed provement or root cause and corrective actions. tory. The capabilities in Montreal were perfect Martin Commercial Engine Solutions Finally, as a profit and loss leader human capital complements to our other product lines and the and finance topics consume time. The truly fun facility has outstanding back shop capability to transport restrictions cause delays in a market interactions are with the community. Whether service both sites and all product lines. that wants speed. it’s visiting a local school to discuss STEM and career options or attending a chamber event to AviTrader MRO: The engine MRO business is AviTrader MRO: Do you have any plans to further support community efforts, it is rewarding to be growing worldwide, what are some of the chal- develop your capabilities? part of the community. lenges that you feel need to be addressed to fur- ther boost this MRO sector? Gowder: Lockheed Martin is known as a leader AviTrader MRO: What is the most challenging in technology innovation. We will continue to part of your job? Gowder: New engine products are bringing more leverage our engineering expertise as we- ex complex and exotic materials. This will require pand our repair and production capabilities. We Gowder: I believe all good leaders continue to look new expertise and large capital investments to will also focus on the value chain of operators as for the right balance of motivating employees to continue to evolve. In addition, the various cer- it relates to engine MRO to make our customers continuously improve and change with the market tification standards and cumbersome processes successful. but not burn them out or be overwhelming. can inhibit competition – similarly, customs and

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AviTrader MRO - April 2014 IBA Analysis 25

McDonnell Douglas MD-11: Current Market Overview by Kane Ray - IBA Aviation Analyst

The DC-10 has since left our skies as a passenger plane and later in the and as a result of a British Airways takeover, British year its younger sibling the MD-11, will be retired from passenger opera- Caledonian’s initial orders were cancelled in favour of tions, with KLM operating their last services to respective Canadian routes the 777. However, unlike the recently retired DC-10, from Amsterdam between Montreal and Toronto on 25th October 2014. the MD-11 will have a fairly substantial fleet remain- ing in the MD-11F guise as a result of a successful The MD-11’s lack of success dates back to the initial deliveries along with conversion programme that saw large North Ameri- the launch of aircraft programmes such as the Airbus A340-300 and Boe- can cargo airlines FedEx Express and United Parcel ing 777-200. Issues with initial range and fuel burn targets hampered the Service (UPS) make the type an integral contributor Kane Ray MD-11 as airlines such as were not satisfied with the to their vast operational networks. IBA, Aviation Analyst performance on their Trans-Pacific routes. Furthermore, Singapore - Air lines cancelled 20 orders, ’s demise meant more cancellations The chart below indicates the MD-11 delivery stream.

McDonnell Douglas MD-11 Delivery Stream

As of April 2014, only four passenger aircraft and approximately 145 for two of the type, the four KLM passenger aircraft are due to be with- freighter aircraft remain in active service. That being said, there is a strong drawn in October and EVA Air will be withdrawing their six aircraft (two of possibility that at least some of this reported active freighter fleet will be which are already stored at Victorville) during the fourth quarter of this parked to manage periods of excess capacity to defer any maintenance year. Adding to what is planned to be removed this year is the storing expense. activity that has been on-going over the past few years from airlines such as Aeroflot, Cargoitalia, China Cargo Airlines, SkyLease Cargo and other During 2014, there have been further withdrawals from former World Airways aircraft.

AviTrader MRO - April 2014 IBA Analysis 26

The following graph examines the historical active plus stored fleet status of the MD-11.

McDonnell Douglas MD-11 Active plus Stored Fleet Status

The MD-11 enjoyed a successful OEM freighter Perhaps most concerning about the combined 11 enthusiasts that there are aircraft out there and passenger to freighter conversion programme fleet number is the proportion of aircraft that are that although not completely broken up, have at (identified in the graph above), as the freighter stored. Although IBA’s JetData database shows ap- least some significant components missing. Some fleet supersedes the passenger fleet. Given the proximately 25 aircraft being stored, it is expected may argue this as a temporary arrangement, but short amount of time since the first aircraft entry that this figure is probably higher due to short- such is the demand for the MD-11 in any guise, into service, this is more a poor reflection of the term parking within the large operator fleets. it could be argued that the future looks bleak for passenger variant. This argument is strengthened such examples and in fact they will be used to by the current parked, scrapped, withdrawn and What is actually stored is also somewhat conten- support the remaining fleet as, and when, com- to be withdrawn fleet of passenger aircraft that, tious and in some respects inaccurate. Many pop- ponents are needed. Admittedly there are some come the end of the year, will total zero. ular aviation picture websites will tell many MD- parked MD-11’s that remain intact, such as China Cargo Airlines’ examples and aircraft that are for sale, notably a Boeing Capital example formerly of Cargoitalia that has been stored at Victorville since 2012. All major components are covered and protected.

From a market perspective, the MD-11 is no longer an option for any new market entrants. Re- cently, the only movements entering the market have been for AV Cargo Airlines of Zimbabwe who took on two ex-World Airways examples in 2013, and Centurion Air Cargo of the United States of America who took on an additional aircraft, for- merly of Cargoitalia. This was as a result of dam- age on landing to another MD-11 in their fleet at Viracopos International Airport, Brazil in 2012.

Barring this activity, rock-bottom lease rates and FedEx MD11 freighters in Photo: AirTeamImages power-by-the-hour lease agreements are not

AviTrader MRO - April 2014 IBA Analysis 27

Lufthansa Cargo operates a large fleet of MD11 freighters Photo: AirTeamImages enticing enough to get some of the stored fleet To offer something positive, but one that isa Furthermore, favourable relationships with the back into operational service. With imminent ex- niche example, IBA has witnessed some activity engine manufacturers and cost reductions be- its from Eva Air, steady exits from Lufthansa and for the MD-11 tail-cone with little surplus avail- cause of bulk engine maintenance can reduce expected exits from Martinair, there is only going ability in the market as operators look to secure costs of ownership and, as other maintenance to be more availability going forward. Additional good condition examples that are not hampered costs can impede operations, securing aircraft for surplus will again endorse the only viable option by corrosion. Little availability remains for this part-out to serve a substantial fleet is something for the MD-11; aircraft part-out. particular component in an overhauled condition. that is very likely happening at this point in time.

With the much publicised part-outs of ex-KLM MD- So what remains for the MD-11? Judging from For the MD-11, the points that have been high- 11s over the past few years and the general over- this article, the prediction would probably be lighted are all relevant but it would be naïve to supply in the market, there has been significant equal to ‘not a lot’ in terms of long-term future overlook current freighter market conditions. Any pressure put on the values of the aircraft, hence placements. However, we would still expect to be upturns, which have long been expected, might the struggles of placement for available aircraft. seeing the aircraft in our skies for a considerable bring about some new demand. However, cur- At the time of writing, values continue to depress amount of time yet. rent parked fleets of larger widebody freighters, and only the engines can be seen as a liquid as- such as 747-400 freighter types, continue to hin- set in a part-out scenario. It helps that both pow- For large freighter operators, the fleet size is sig- der any confidence in the sector with continued ering engines, the CF6-80C2D1F and PW4460/ nificant and plays a crucial role in operations as retirements and parking of certain aircraft types, PW4462 (PW4000-94 family), share vast compo- they cannot afford to immediately replace the air- particularly when they are in need of any heavy nent commonality with engines powering A300/ craft. As other types are exiting the fleets, such as maintenance such as a D-check. A310, Boeing 747 and aircraft variants the MD-10 and previously the 727s from FedEx’s making their target market much larger. Other fleet, owned MD-11s remain integral and not a rotable components such as APUs, landing gears priority in terms of fleet transition. For those air- The IBA is an independent aviation and thrust reversers will command a sizeable shelf craft that are leased, options to purchase at part- consulting firm based in Leather- head, UK, with representation price, but demand will dictate whether they will out value might be achievable upon lease-end as worldwide. find placement. With fewer aircraft to serve and this appears to be the only benchmark in the cur- a continually depleting market, such components rent market. As has been observed by passenger For more information, contact Owen Geach: could never meet the values that are currently as- operator Allegiant Air, direct ownership of aircraft [email protected]; cribed to them by component specialists. can lead to healthy and profitable operations. T: +44 (0) 1372 224 488; M: + 44 (0) 7917 648 712

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www.ibagroup.com Hanger Development 29

Humanizing the hangar Can designing aircraft maintenance facilities with human factors in mind promote safer and better practices? Analysis by Rus Sutaria – Avia Intelligence Limited, London

Hangar development, or for that matter re-de- When it comes to the way we operate and fied. Knowing the velopment is one of those necessary evils where maintain aircraft, good ergonomic design, well numbers of person- aircraft maintenance is concerned. Over the 30+ thought-out maintenance practices and proce- nel that the business year life of large maintenance facilities, those in- dures are already in place, and have had very intends to acquire volved with the specification and ultimately im- positive influences on aviation over the years. as it grows, does, to plementation of any hangar solution needs to get We have even further studied the effects of fa- all intents and pur- it right on so many levels. Topping the list is long tigue, and have installed effective policies in poses mean plan- term capability planning for the facility. However, that regard. Yet, there is little research regard- ning for adaptable when speaking to a number of commentators, ing hangar development or re-development that facilities within the a lack of balance in terms of safety protection considers maintenance human factors as a part hangar environment. against production still seem apparent. of the design specification. Surely, a well thought Therefore planning Rus Sutaria, Director – Con- out hangar specification, would make all of our for accessibility of tent and Knowledge Services Photo: Avia Intelligence Ltd Hangar design, particular for those MROs that lives easier when it comes to combatting some, the basics in terms work through the night is “very much neglect- if not all of the ‘Dirty Dozen’? Not only that a of tooling, parts and ed” according to Ray Ward, an independent well laid out hangar solution must also promote a place to consult technical data is important. industry consultant. History has often proven best maintenance practice, and contribute to the However, having to walk 15 or 20 minutes to in this regard that if anything does go wrong, overall safety objective of aviation. acquire parts and/or tooling, and then having the origins of the incident, more often than to take the stuff back to where the aircraft or not start during the night-shift and in a hangar. Together with Ray Ward, Rus Sutaria discusses workshop is located would take time and energy Good examples include the BAC 1-11 incident the viability of re-designing hangers with re- which quite often engineers will deplete quickly and the more recent the unsecured engine garding to assisting with the promotion of ‘best if they are asked to repeat the process numerous cowling latches. A great number of these inci- human factors practice’, and attempts to assess times within the shift. In a lot of cases, engineers dents can be ironed out through better aircraft whether this approach to enhancing safety is no are already exhausted before doing the job that design, and to a greater extent through the in- more than a hiding to nothing. they are asked to do! troduction of training. However, there is only a limit to how much can be designed into an Convenient layout can help reduce the Tooling is also another increasingly important aircraft or a maintenance procedure. If human rate of engineer fatigue. issue, with MROs being required to maintain factors issues are to be further resolved, main- aircraft with TC holder approved equipment. tainers and operators must now consider other Although it may seem blatantly obvious, suffi- “We aren’t just talking about specialist stuff areas of aviation infrastructure with regard to ciency in terms of numbers of staff would actu- that we utilise once in a while, but an increas- procedural design as well as concentrating on ally seem to be the first port of call, once the 30+ ing amount of standard tooling that engineers the actual facility itself. year business plan for the MRO has been speci- require on a daily basis,” states Ray Ward. None more so than tooling that requires calibration and re-calibration. This equates to a substantial increase in required storage space for this new maintenance reality. Hangars would then need to be designed to plan for easy access to controlled tooling and equipment. Mr Ward further states that, “With increased importance on controlled and approved tooling, the enlargement and re- purposing of the stores facilities will be critical”.

Making hangars healthier places

Most aviation professionals (particularly those of us who work there) would generally agree that the hangar environment is not the healthiest of places. Key threats to engineering and non- engineering personnel are easily identified in the form of noise and distractions, temperature and humidity and lighting levels.

Unfortunately, noise and distraction are consid- Are human factors properly considered in hanger development.. Photo: SR Technics ered unavoidable…or are they? Although not

AviTrader MRO - April 2014 Hanger Development 30

Practical hanger design can help boost productivity. Photo: JorAMCo.

Ward’s specialty, he feels that, “hangar design Hangar specification to excellent effect. Although this is not incorrect, in terms of specified materials and clever archi- it is perhaps not the only approach if human fac- tectural formats may contribute to the damping- Re-specifying existing hangars will always be a tors have to be considered. Perhaps architects down of some (if not all) sources of noise that a difficult and expensive business. Managers are should attend the same maintenance human fac- typical aircraft hangar is prone to.” usually reluctant to make the necessary invest- tors courses as the rest of us. This will provide ments. Ray Ward agrees that these sorts of pro- them with a much needed understanding of the Off-course, re-designing the hangar would mean jects do tend to have a heavy price-tag associ- human factors challenges faced by the aviation starting again from scratch, and may not neces- ated with them. However, “What is the cost if maintenance industry, with a view to designing sarily be an option. However, modern building something goes wrong?” Ward suggests that the the best possible environment for planning, and materials, which are carefully applied to exist- price tag for a more humanly conducive mainte- implementing aircraft maintenance. ing hangars, will go some, if not all of the way to nance environment need not cost the earth. making the hangar less-noisy. Old versus new? Most engineers will tell you that even a modest Where temperature and humidity are concerned, loss of productive time means a radical increase in Demolishing and re-building new hangars in designers of hangar solutions often have to wres- pressure to get the job done, not least, the aircraft place of old ones, is, in Ward’s opinion “the last tle with local climatic conditions, a problem that is out on time. The key to solving this particular is- resort”. As previously indicated, careful study on made worse where the meteorology is highly vari- sue is not easily quantified. Facilities and facilita- the part of all concerned with hangar develop- able and unsettled, or is prone to extremes. This tion work must be a combination of well thought- ment, and the modification of existing facilities simple fact does go a long way to explaining why through procedures coalescing with well laid-out would invariably be the more cost effective op- there is no standard to hangar design that ensures hangars and the application of common sense. tion. In all truth the only reason why hangars the correct levels of temperature and humidity. should be replaced with new facilities, is based A commonly held belief is that hangar design around the argument of aircraft size exceeding “There should be” says Ward. Going further, he should also be influenced by the design of main- the physical capabilities of the old hangar. Ray points out that “such standards have always existed tenance procedures and practices. Perhaps the believes that it is important for aircraft to be fully in the stores environment, and is utterly amazed real solution will be to consider hangar devel- enclosed, as this would contribute to a positive that this policy does not extend beyond the stores opment whilst developing or redeveloping the maintenance human factors environment, and facility”. The reality is that budgetary constraints MRO’s Maintenance Organisation Exposition. It is will undoubtedly promote best practice and a tend to overshadow these environmental con- also essential that hangar designers should work higher performance return. cerns. As such “the environment is a consideration hand-in-glove with the designers of maintenance but lacks sufficient importance to warrant further procedure, thereby providing a more joined up In closing, the message for those MROs consid- investigation, much less investment”. answer to the human factors issue. ering upgrade of their facilities is to ensure that you have sufficient maintenance human factors The BAC 1-11 incident all those years ago only The utopian ideal in terms of the hanger solution oversight, as this will afford you a better hangar proves the point that “things never look the same would be to design the new or existing building design, which in turn will lead to better and safer in subdued lighting or the night environment, in context of procedural or expositional require- aircraft maintenance practice. However, on a cau- when compared to looking at the same article ments, human needs as well as approved capa- tionary note, Ray Ward rightly points out, that the during the day.” Add to that fatigue, an element bilities. The trick will be to do all of this whilst human capacity to make mistakes can never be of complacency and the effects of the circadian keeping the profitability of the MRO firmly in entirely designed out of any hangar solution. rhythm, and we quickly realise that engineers be- sight. Architects by their very nature produce so- come guilty of seeing what they want to see! lutions that manage the space around the aircraft

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a Lean Six Sigma “Black Belt” in all areas of aircraft maintenance, from components, to engines, and air- frames. From 2007 he was Director MRO at KLM En- gineering & Maintenance’s Engines Division, tasked with overseeing all production processes and steer- ing the implementation of Six Sigma methodology. Under his leadership, the Division cut CFM56 engine overhaul shop time from 85 to 60 days.

AerSale released that Dennis Zalupski has joined the Sjoerd Vollebregt stepped down as CEO of Fokker, April 1st team as Senior Vice President & General Manager – Photo: Fokker Materials Group. This position will further support Sjoerd Vollebregt has announced that he will step AerSale’s rapidly expanding global reach specifically down as Chief Executive Officer of Fokker Technolo- in the airframe and engine parts sales market. Za- gies per April 1st, 2014. He will be succeeded by lupski most recently served as the President & CEO Hans Büthker, currently the Chief Operating Officer of Kellstrom Industries. He first joined Kellstrom in of the company. June 2001 as Senior Vice President – Sales & Mar- keting and later was appointed President, Kellstrom Vincent Sandoval new Group President at CIRCOR Aerospace Johan Bank, Director MRO, KLM Engine Services Commercial Aerospace and successively President, & Defense Photo: CIRCOR since 2007, has been appointed Vice President En- Kellstrom Industries. In April 2006, Zalupski assumed Company as Group President—CIRCOR Aerospace gineering, KLM E&M. Johan Bank began his profes- the Chief Executive position and was elected to Kell- & Defense effective March 19th, 2014. Mr. Sand- sional career at KLM Flight Operations as a flight strom’s Board of Managers. oval currently is the President of TransDigm Group, engineer on Douglas DC10s. Subsequently, from Inc.’s Semco Instruments subsidiary, which designs 1993 to 2003, he became a flight engineer on Boeing CIRCOR International, leading provider of valves and and manufactures sensors and harnesses for use on 747s. In 2003, he moved to KLM’s Engineering and other highly engineered products for markets includ- various commercial and military airframe and engine Maintenance Division to oversee implementation of ing oil & gas, power generation and aerospace & platforms. He replaces Michael Dill who is leaving Lean Six Sigma projects. For four years he worked as defense, released that Vincent Sandoval will join the the Company to pursue other opportunities. KNOWLEDGE IS POWER!!!

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AviTrader MRO - April 2014