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MRO AviTrader April 2011 - www.avitrader.com ENGINE MAINTENANCE • Is it an OEM business? • The PMA debate INDUSTRY INTERVIEW • Charles Willis of Willis Lease SECTOR NEWS • Techspace Aero, SIAEC, Mxi and more ENGINE MAINTENANCE AND EGT MARGIN Editor‘s Page 2 The Engine Issue: engine maintenance, leasing, EGT margin and more W ELCOME TO OUR APRIL ISSUE OF can only handle about a third of the shop visits Charles Willis, founder and CEO of Willis Lease. AviTrader MRO magazine, which, as scheduled each year for GE and CFM engines. Willis gives us fascinating insight into his ‘rags you can see, is all about engines. The last to riches’ emergence as an industry leader and Other companies are not so sure. They speak of time we focused on engines was nearly a year expresses his views on the state of the engine the increasing encroachment of the OEMs on ago, in our June 2010 issue, when we spoke leasing business in no uncertain terms. what was traditionally MRO shop turf and point to industry professionals about the subject of out that if it were not for the general expan- Our regular International Bureau of Aviation spare engine leasing, so we thought it high sion in the global airline business, a lot of MROs analysis focuses this month on engine mainte- time to return to this rather crucial sector of would be in trouble. The OEM ‘total-care’ type nance and EGT margin - again, a timely and the aviation industry. This time, however, we of after-market service agreement comes under ﬁtting piece that complements and enhances look at maintenance, and we ask the burn- ﬁre from lessors and service providers as well. the subject matter in this issue. ing question: Is engine maintenance an OEM business or is there room for third parties and We then touch upon the debate over the use Next month, we’ll move on to the Middle independents? of PMA parts, and hear from a range of profes- Eastern MRO market - again, a timely topic sionals on the subject. Are PMA parts a contro- given the current unrest in the region. After What emerges is that there is no clear consen- versial issue with a serious impact on the global that, June’s issue looks at the engine life cycle, sus on the matter. Brian Ovington of GE Avia- MRO business, or is the debate just a lot of hot while our summer special magazine centres of tion gives the case for the OEMs, and explains air, as one of our contributors suggested. Read the biggest airshow of the year, which in 2011 that GE, in particular, maintains a wide range is, of course, Le Bourget in Paris. Why not con- on to see what these executives are saying, and of partnerships with MROs around the world, let us know what you think. tact us now and give us your perspective on as a means of dealing with its huge backlog of these and other issues? We look forward to service contracts, and adds that the company Also featured is an exclusive interview with hearing from you! Ed. MRO AviTrader Published monthly by AviTrader Publications Corp. 9500 Aquila Road Richmond, BC Canada V7A 3P9 Email: firstname.lastname@example.org Tel: +1 (604) 448 0970 www.avitrader.com Editorial Catherine Davies, Editor Email: email@example.com Tel: +44 (0) 1442 870 058 Mobile: +44 (0) 7772 896 280 ST Aerospace engineer preparing a CFM56-5B engine for test ST Aerospace Advertising inquiries Jenny Falk Contents Head of Sales & Marketing Email: firstname.lastname@example.org Tel: +49 (0) 8761 346007 Airframe News . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Engine News . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Registration Component News . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 AviTrader MRO is a subscription-free Cover Story: Engine Maintenance - An OEM Business?. . . . . . . . . . . . . . . 10 monthly publication. To receive a copy in Cover Story: Engine Maintenance - The PMA Debate . . . . . . . . . . . . . . . . 13 your inbox every month, please send an Industry Interview: Charles Willis of Willis Lease. . . . . . . . . . . . . . . . . . . . 16 email with the subject “subscribe” to oem- mro@avitrader com IBA Analysis: Engine Maintenance and EGT Margin . . . . . . . . . . . . . . . . . 18 IT News . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Opinion News in Brief . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Please send your comments and queries to Industry People on the Move. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 email@example.com AviTrader MRO - March 2011 Engine Leasing Asset Management All Manufacturer Types Long, Medium & Short Term Leases • Operating Leases • Asset Management • Sales & Leasebacks All Manufacturer Types • Operating Leases Asset Management • Sales & Leasebacks All Manufacturer Types • Long, Medium & Short Term Leases • Operating Leases • Asset Management • Engine Trading • All Manufacturer Types • Sales & Leasebacks • Asset nagement • Long, Medium & Short Term Leases • Operating Leases • Asset Management • All Manufacturer Types • Sales & Leasebacks ating Leases • Engine Trading • Long, Medium & Short Term Leases • All Manufacturer Types • Operating Leases • Asset Management Leases • Long, Medium & Short Term Leases • Operating Leases Manufacturer Types • Sales & Leasebacks • Engine Trading ong, Medium & Short Term Leases • Operating Leases • Sales & Leasebacks • Engine Trading • Asset Management • Long Medium & Short Term Leases • Engine Trading • Operating Leases • All Manufacturer Types • Asset Management um & Short Term Leases • Asset Management • Sales Leasebacks • All Manufacturer Types • Long, Medium and Short Term Leases • Operating Leases • Asset nagement • Sales & Leasebacks • All Manufacturer Management • Long, Medium & Short Term Leases ypes • Operating Leases • Asset Management • Sal e s & Leasebacks • All Manufacturer Types Long, Medium & Short Term Leases • Operating es • Asset Management • Sales Leasebacks ng Leases • All Manufacturer Types • Long Medium Short Term Leases • Operating Leases Asset Management • Engine gine Trading • All Manufacturer Types Leasebacks • Engine Trading • Asset anagement • Medium & Short Term KEEPING YOU IN THE AIR ses • Operating Leases • Asset agement • All Manufacturer Types les & Leasebacks • Operating ases • Engine Trading • Long Medium & Short Term Leases es • All Manufacturer Types ent • Asset Management Medium & Short Term Leases • Operating •Sales & Leasebacks ong, Medium & Short • Operating Leases sebacks • Engine ment • Operating rt Term Leases Management cturer Types rm Leases nagement Leases Term www.elfc.com selected Airframe News 4 liNe mAiNteNANce United Airlines’ 777 fleet set to be modified with new Performance Improvement Package Ameco Beijing provides line main- tenance services to Singapore Air- United Airlines’ 777 fleet will be modified with a Performance Improvement Package that will lines result in greater fuel efficiency, along with reduced emissions. The package, to be installed on 52 United Airlines 777s, is expected to reduce fuel spending per airplane by about $200,000 Ameco Beijing has been providing line annually (assuming $100 per barrel crude oil prices), according to Boeing estimates. The 777 maintenance services including aircraft Performance Improvement Package improves the airplane’s aerodynamics through a software releasing to Singapore Airlines in Beijing. change to enable a drooped aileron, a ram air system improvement and the installation of Singapore Airlines operates Boeing 777 improved wing vortex generators. aircraft on Singapore-Beijing route, with 21 flights per week. This is the first co- operation between the two companies in the respect of line maintenance. bmi signs agreement with Mon- arch Aircraft Engineering Independent aircraft maintenance provid- er, Monarch Aircraft Engineering (MAEL) signed line maintenance technical han- dling agreements with bmi, British Mid- AirTeamImages land International. Under the terms of the agreements and with immediate effect, MAELs experienced engineering team will Biggest A350 XWB carbon fuselage panel manufactured provide line maintenance support to bmis Airbus partner, Premium AEROTEC, successfully completed the curing of the largest A350 XWB A320 fleet operations at Birmingham and fuselage panel made from carbon fibre at its site in Nordenham (Germany). Located on the for- London Gatwick. ward right-hand side of the fuselage and measuring 93 square metres, the panel will undergo ultrasonic inspection, trimming and drilling in the coming days prior to being joined with the other panels that together will become the forward fuselage (Section 13-14). Airbus opted for LTP completes overhauls for Asiana large fuselage panels for the A350 XWB design as they can be tailored in terms of their thickness and Swiss according to the different loads required at each part of the airframe. Asiana Airlines expanded its cooperation AVISA and aeroDAC partner with CASL to serve SE Asia and China with Lufthansa Technik Philippines (LTP) when it contracted the Manila-based main- AVISA Aviation Safety Systems recently signed an agreement to work with China Aircraft Services tenance, repair and overhaul facility to per- Limited and aeroDAC, an EASA-approved part 21 design organisation, with capabilities in every form heavy maintenance check on an Airbus aspect of aerospace design, aircraft certification and approval. The new partnership will see the A320 aircraft. The IL-check was completed three businesses working together on collaborative projects across both the South East Asia and earlier this month. Chinese markets. The combination of AVISA and aeroDAC’s EASA approved services alongside CASL’s maintenance services will aim to provide operators with a one-stop shop for all their A Swiss International Air Lines Airbus A340- Maintenance, CAMO and Design requirements. These services will be delivered collectively from 300 also underwent a heavy maintenance new offices in Hong Kong. check at Lufthansa Technik Philippines (LTP). Along with the D1 check, LTP performed cabin modification which involved installa- Testing of Bombardier CSeries Aircraft systems begins tion of flat bed seats in the business class The first systems for Bombardier’s CSeries airliner program are now being developed and tested at section and the consequent reduction of partners and vendors in Canada, the USA and Europe prior to delivery to Bombardier’s Complete the tourist or economy class seats to accom- Integrated Aircraft Systems Test Area (CIASTA). The installation of the systems rigs at the CIASTA is modate the wider new business class seats. progressing on schedule, and some parts, including the engine accessory gearbox and flight deck This event marked the first time that Swiss controls, have already arrived. Located at Bombardier’s Mirabel facility north of Montréal, the CIASTA International Air Lines, a member of the is the high-tech laboratory that will test the CSeries aircraft’s systems ahead of first flight and will con- Lufthansa Group, sent an aircraft to the Ma- tinue to support systems integration during the flight test program. Supported by three main pillars nila-based Lufthansa Technik AG subsidiary - risk mitigation, advanced quality planning and solid governance - execution of the CSeries aircraft for maintenance work. program is designed to enhance the reliability and maintainability of the CSeries jetliner. SES ad AviTrader MRO - April 2011 Flexible OEMRO® service that keeps your CFM56® engines in the air. Service soars with the Eagle. With more than 85 years of experience producing and maintaining dependable engines, Pratt & Whitney Global Service Partners provides hundreds of dependable MRO services through a global network that can take care of your CFM56® engines 24/7, anywhere in the world. By combining the experience of an OEM with the ﬂexibility of an MRO, we create value that can help your profits soar. Discover the OEMRO® advantage at pw.utc.com/OEMRO. CFM56 is a registered trademark of CFM International. Overhaul | Repair | New Materials | Used Materials | Line Maintenance Services It’s in our power.™ selected engine and components News 6 Techspace Aero develops the BluM lightweight bladed drum for low-pressure compressors Safran Group subsidiary Techspace Aero has developed a new rotor for low-pressure compressors, the bladed drum or BluM, which will provide a light-weight solution for new generation engines. Project manager Eric Marot explains the advantages of the BluM: “All en- gine-makers are already very familiar with integrally-bladed disks, better known as blisks, in which the blades are generally machined out of the same piece of material as the disk, to form a one-piece rotor stage. The advantage is considerable weight savings. So we simply adapted this technology, generally used in high-pressure compressors, to the low-pressure compressor. “In today’s jet engines, the low-pressure compressor is based on a cylindrical drum comprising circular chan- nels in which the blades are slotted. With the BluM, we maintain the basic drum concept, simple and inexpen- sive to manufacture, and then use friction welding to attach the blades. The friction welding process, which is starting to be more widely used in aircraft engines, is both accurate and strong, because it maintains the me- chanical properties of titanium. Furthermore, it provides a significant reduction in rotor weight, of about 20%. “The drum is now ready, and we will shortly start blade welding, with tests on an engine test rig slated for next year. The current development timetable provides for the incorporation of this new compressor rotor design in the new-generation engines that will enter service towards 2020.” Techspace Aero’s new lightweight bladed drum, or BluM Safran Group Solo Aviation named Authorized Serv- Hamilton Sundstrand, AVIC EM final- Ethiopian Airlines signs 777 Compo- ice Center for GE M601 and H80s ize joint venture agreement nent Services agreement Solo Aviation signed an agreement with GE Avi- Hamilton Sundstrand Corporation and AVIC Ethiopian Airlines signed an agreement to par- ation to become an Authorized Service Center Electromechanical Systems Company Limited ticipate in the 777 Component Services Pro- for the M601 and H80 turboprop engines. Solo (AVIC EM) finalized plans to co-develop and gram (CSP), a parts-provisioning program that Aviation will offer comprehensive line mainte- manufacture the electric power system for the significantly reduces the airline’s up-front invest- nance, removals and re-installations of engines new Commercial Aviation Corporation of China ment in spare parts and offers a quick and reli- and LRUs and engine spares for the M601 and (COMAC) C919 jetliner. The two companies an- able supply of critical parts from a pool shared H80 engine families. GE Aviation will provide nounced a framework agreement for the joint by participating 777 operators. Ethiopian Air- Solo Aviation with comprehensive material sup- venture at the Zhuhai Air Show in November, lines is the 13th airline in the 777 Component port and training. Formerly know as Hangar 4, 2010. This agreement finalizes the commitment Services Program, offered jointly by Boeing and Solo Aviation Systems, based in Ocumare del to form a new company that will develop and Air France Industries KLM Engineering & Main- Tuy, Venezuela, is an engine maintenance and manufacture the C919’s electrical power sys- tenance. Ethiopian’s agreement for the 777 CSP services provider, attending to a wide range of tem, including generation and distribution, and initially covers three 777-200LRs jetliners, all aircraft models in private, corporate and com- will serve as a tier one supplier to COMAC on delivered since November 2010. Two additional mercial aviation. Solo Aviation provides mainte- that program. This joint venture will be located deliveries are scheduled for this year, one in late nance and services for M601 engines installed in Xi’an and plans are in place to begin facility April and the second in the third quarter. The on L410 aircraft. development in June, 2011. airplanes were ordered in 2009. Engine Management Airframe Support Sales & Leasing Professional Services Regional Aircraft Regional Engines Aircraft & Engine Management m ATR 42/72 All PW100 series, Dash 8 100/200/300/400 including PW150 Consignments & Purchasing CRJ 100/200 CF34 A1/B1 of Surplus Inventory Embraer 120 AE3007A1 Aircraft Leasing & Trading Commercial Aircraft Commercial Engines Technical Advisory Services Airbus A300/A310/A320 CF6-50C2/80C2 Boeing 737/747/757/767 PW4000 V2500/CFM56 Magellan Aircraft Services Magellan Aviation Services Wheels and Brakes Specialist Trading Division with Maintenance Division Leasing Division offering signiﬁcant ready-to-go Evidently, lots of designers offering competitive and easy and cost effective are using Visio to layout Wheel and Brake around on top quality repair and solutions through Lease pages. As you dig Packages, Pool inventories in Copenhagen, overhaul services for the web, Hamburg and aircraft Wheels and Agreements and Cycle Miami Brakes Flat Rate (CFR) EASA Approval no: Programs DE.145.0459 TP Aerospace Stamholmen 165 R AOG DK-2650 Hvidovre HOTLINE Denmark, Europe +45 899 399 29 firstname.lastname@example.org www.TPAerospace.com selected component News 8 SIA Engineering Company and Sagem launch avionics centre in Singapore SIA Engineering Company (SIAEC), in partnership with Sagem (SAFRAN Group), launched a state-of-the-art avionics facility in Singapore. The new facility of Safran Electronics Asia (SEA), a joint venture owned 49% by SIAEC and 51% by Sagem, was officially opened on April 6th. With the increasing trend of new aircraft adopting digital technology, the joint venture is poised to tap the growing avionics mainte- nance, repair and overhaul (MRO) market. The new facility at Changi North Rise supports the latest aircraft types and is designed for expan- sion of capabilities to handle next-generation aircraft, such as the B787 Dreamliner and the Airbus A350. The avionics joint venture is the second partnership between SIAEC and SAFRAN; the first was with Messier Services Asia, a SAFRAN subsidiary specialising in the repair and overhaul of landing gear systems. Sagem chair and CEO Jean-Lin Fournereaux said that the new fa- cility symbolized SAFRAN’s long-term commitment to Singapore, which had become the primary operational centre for the Group’s MRO operations in Asia. SIAEC CEO William Tan added that the new facility is ‘one of our 15 joint ventures in Singapore forged with leading OEMs. Over the years, SIAEC and its OEM partners have invested S$600 mil- lion in establishing cutting-edge aerospace capabilities in Singapore. Through these OEM facilities, airlines have direct access to OEM support, spares and proprietary technology. These benefits inte- grate seamlessly with the MRO services of SIAEC to offer airlines a Singapore government minister Mrs Lim Hwee Hua, flanked by Stephen Lee, chair of SIA one-stop solution to achieve higher operational reliability and faster and SIAEC, and Sagem chair and CEO Jean-Lin Fournereaux, at the signing ceremony at turnaround at lower cost”. the opening of the Safran Electronics Asia facility. SIAEC Chromalloy joins Rolls-Royce team to international customers’, a Mubadala execu- provide installation, maintenance, repair and develop new Commonwealth Center tive told Arabian Business. Strata supplies flap upkeep services. SCHOTT Lighting and Imag- for Advanced Manufacturing track bearings for Airbus A330 and A340s, ing will be contributing its expertise and ex- part of a $1 billion business that also includes perience in the area of lighting systems. The Chromalloy, the world’s largest independent providing ailerons to Airbus, flap track fairings first product that the two firms are working on supplier of advanced repairs, coatings and FAA- for the A380 ‘superjumbo’ and empennage together is a unique new lighting technology. approved replacement parts for turbine airfoils or tail sections for ATR. The combination of glass elements and light and critical engine components, announced diodes culminates in an efficient light source that it will partner with Rolls-Royce as an Organ- Sabena technics signs full component that helps lower maintenance costs and ex- izing Industry Member on the development of tends the service life. support deal with Alba Star the new Commonwealth Center for Advanced Manufacturing (CCAM). The CCAM manu- Sabena technics, specialized in civil and mili- Fokker Services and Bombardier enter facturing research center will be developed at tary aircraft maintenance, signed a three-year strategic alliance Crosspointe in Prince George County, Virginia, contract with the Spanish start-up cargo and as a public / private partnership between Rolls- passenger operator Alba Star to perform full Bombardier Aerospace entered into a strategic Royce, eight Organizing Industry Member com- component support services on its B737-400 alliance with Fokker Services for the launch of panies, and Virginia’s leading public research fleet. Sabena technics has started support- FLY, a new program aimed at improving the facilities – the University of Virginia and Virginia ing Alba Star through its Integrated services availability of components and reducing the Tech. The 50,000 square foot CCAM research business unit, dedicated to full support con- cost of repairs for Dash 8/Q-Series 100/200/300 center will be built on land adjacent to the new tracts. Services to be provided for the Palma aircraft operators. The program will also help Rolls-Royce manufacturing facility. Construction de Mallorca and Milan based operator are for operators to better predict and budget for ma- will begin in 2013. an initial 3-year period. They will include com- terial maintenance. The FLY program will offer ponent repair and overhaul, pool access and operators guaranteed availability of serviceable Mubadala company to produce spoil- logistic support. components, a factor that will appreciably ex- ers for Boeing 787 Dreamliner tend the longevity of out-of-production Dash Lufthansa Technik and SCHOTT plan 8/Q-Series 100/200/300 aircraft. The program Strata, the UAE aerospace company owned also provides customized component repair and to cooperate on cabin lighting by Abu Dhabi investment group Mubadala, overhaul services on a cost-by-the-hour basis, signed a subcontracting deal to supply the Lufthansa Technik and SCHOTT AG plan to allowing operators to better manage the life cy- wing flaps, or spoilers, for Boeing’s long-de- work together more closely on cabin light- cle cost of their aircraft. The service is modeled layed 787 Dreamliner. The deal was sealed ing for passenger planes. Conceived to be a on Fokker Services’ well-established and highly through FACC, an Austrian-based contractor “one-stop shop” strategy, the collaboration successful ABACUS cost-by-the-hour program, of both Boeing and Airbus, and becomes ef- will cover the entire process chain, ranging which has been bringing cost predictability and fective in 2012. Strata’s Al Ain plant, which from the design of lighting to manufactur- parts availability to operators of post-produc- was completed last August, is an aerostruc- ing, installation and approvals, but also service tion models for 17 years. Under the FLY pro- ture composite manufacturing facility, and the over the course of the entire product lifecycle. gram, Fokker Services will execute repairs on deal is a ‘signficant milestone in its progress Lufthansa Technik will concentrate on the area components and ensure the availability of parts towards a full-service offering for local and of lighting control, approval and validation and through its large component exchange pool. AviTrader MRO - April 2011 Launch customer 747-8 Intercontinental Leasing an aircraft doesn’t make it fly. We do. Lufthansa Technik’s Aircraft Leasing and Trading Support (ALTS) is the fast, professional service that takes over when a leased aircraft changes operators. We handle the full spectrum of checks and modification work, including design, cabin furnishings and repainting — all the way up to the necessary inspections and approvals. In short, we take care of all the technical and administrative tasks of aircraft leasing for you, whether you’re the lessor or the lessee. Let’s talk about it! Lufthansa Technik AG, Marketing & Sales E-mail: email@example.com More mobility for the world www.lufthansa-technik.com/leasing Call us: +49-40-5070-5553 cover story - engine maintenance 10 An OEM business or room for all? Engine maintenance is big business, but the market is increasingly domi- nated by the OEMs . Is there room for independents, and if so, what do they need to do to position themselves as attractive alternatives? e NgiNe mAiNteNANce is big business by any industry standard. The sector turned over upwards of $15 billion last year, of the global engine maintenance market (see table at right) says that there is plenty of room for in-house airline MRO providers as well “OEMs play a major role, but customers typically do not like and that figure will rise by at least 40% by as third-party independent MROs to handle monopolies. So you 2017 to reach well over $21 billion, accord- worldwide demand for engine maintenance. see partnerships with ing to figures from the International Bureau of airlines and established Aviation (IBA). Engines are the most expensive “GE and its joint venture CFM have more than MROs in various for- components on an aircraft, and their upkeep 23,000 engines in service on a variety of aircraft mats, depending on represents 35% of the total MRO spend each from regional jets to widebody aircraft,” says the OEM. Also, for year. Less than a quarter of that work is carried Ovington. “Of these engines in service, we’ll certain engine models out in-house by the airlines themselves. see about 4,000 shop visits per year and we an- the OEMs will not have ticipate this to remain at this level and maybe the capacity to handle SR Technics’ Walschot With such a large volume of maintenance re- even increase as more engines enter service volume in their quired each year, amid own facilities so again, they set up partner- forecasts of a tripling “We’ll see about 4,000 shop visits per year for ge and ships.“ of the global fleet be- cfm’s 23,000 engines in service. ge has the capacity to tween now and 2029, Singapore’s ST Aerospace, like SR Technics, surely it stands to rea- handle about a third of these at its branded facilities.” has a number of cooperative agreements son that there’s enough Brian Ovington, senior marketing manager for MRO, GE Aviation with OEMs that allows it to develop and work out there to keep deliver proven, cost-effective solutions a whole engine MRO sector healthy and other- based on record orders that were made in the that ‘increase asset value and reduce lifecycle wise engaged? You’d certainly think so; yet a last part of the decade. GE has the capacity to cost’. Choo Han Khoon, the company’s execu- number of industry professionals consulted by handle about a third of these shop visits at its tive vice president, Engine Total Support, says AviTrader MRO say there’s not. GE branded facilities.” that partnerships with OEMs like GE allows it to offer a ‘solution or a product that is of Leading the chorus are the lessors, who point Customers see the value in having an OEM known pedigree and configuration’. the finger at OEM all-inclusive care packages service their engines, says Ovington. “GE con- which, they say, are smothering competition in tinues to see a 4-5% growth in the backlog Engine Maintenance: Market Share the MRO marketplace. Jon Sharp, president and of long term agreement each year – with the Engine MRO Country Mkt share CEO of ELFC, remarks on the sharp increase in current backlog of service contracts with 140 the OEMs’ market share of the engine main- customers valued at $59 billion. Additionally, GE Aviation USA/UK 12% tenance business, from around 15% a decade with GE’s extensive in-house repair capability, Lufthansa Technik Germany (HQ) 6% ago to nearly 50% today, with the ‘consequent and access to the largest supply of new and Delta TechOps USA 4% worrying impact on competitive options’. Wil- used materials, we can offer competitive so- lis Lease president Charles Willis weighs in, lutions ranging from one shop visit to large, Snecma France 4% suggesting that there are serious anti-trust and multi-year agreements.” MTU Germany 3% accounting questions to be asked about OEM IBA total care-type packages - and whether they GE has an extensive network of OEM and have ‘really sold their assets, as they still have partner MROs, including third-party provid- “Engine maintenance is not an OEM business effective eco- ers like Air per se,” said Choon. “We believe that there nomic and “engine maintenance is not an oem business F r a n c e / K L M is room in the engine MRO industry for airline operational per se - we believe there is room in the engine Engineering & shops and independent MRO specialists like control over Maintenance, ourselves. We offer complementary service of- them’. And mro industry for airline shops and independ- ST Aerospace fering to OEMs’ after-market solutions. In many the exclusive ent mro specialists like ourselves.” and Standard instances, engine OEMs may not be able to partnerships Choon Han Khoon, executive VP, Engine Total Support Aero, which cover a comprehensive range of services. That is signed by ST Aerospace can now of- where we come in; we’re able to provide more OEMs with fer customer customizable solutions with a geographical third-party MRO providers excluding the use of workscopes similar to what OEMs provide, proximity to customers.” PMA parts opens up a whole new kettle of fish along with OEM material. - a debate we’ll explore later in this article. Smaller companies, too, can find their niche in There is room for independent shops, provided the ‘backshop’ of the OEM and their MRO part- But let’s hear from the original equipment they have some sort of joint venture or full-sup- ners. Andrew Walmsley, VP of sales and mar- manufacturers themselves first. Brian Oving- port agreement, or both, with an OEM, accord- keting at Jet Aviation Specialists, a small fam- ton, senior marketing manager for MRO at GE ing to Frank Walschot, senior vice president, en- ily-owned independent repair facility in Miami, Aviation, which has the largest single chunk gine maintenance at Zurich-based SR Technics. says the company has found a role as a ‘reliable AviTrader MRO - April 2011 cover story - engine maintenance partner for either niche repairs, or repairs on parts no longer deemed ENGINES core products. As larger organizations struggle to match resources to capacity demands, we are able to supply them with the flexibility to Engine sales, exchange, leasing, material supply and meet the peaks and surges that come with market changes.” management. Dedicated, experienced customer and technical support services. All this from a proven, The RISe and RISe of The oemS The OEM weapon in securing an ever-larger slice of the engine main- award-winning 24/7 world-leading service provider. tenance pie is two-pronged. First of all, any MRO wishing to repair engines must have a product repair licence from the OEM in ques- tion. “At the end of the line, you have to deal with the OEM to be able to fix their engines,” said one industry observer, ‘so you might as well maximize your relationship with them through a partnership, which will give you reduced prices on parts . In return, you’re gener- ally obliged only to use parts manufactured by that OEM.” And secondly, the OEMs have been phenomenally successfully in expanding their market share through long-term support contracts sealed as part of the initital engine sale. It takes years and millions in investment to design an engine, but the real return on investment comes from component sales. “Selling spare parts is the OEMs’ bread and butter,” said another observer. “They will do whatever they can to protect their market.” “leasing companies own 32% of the aircraft order backlog and so they should have an important voice. lessors do not like these all- inclusive care packages, because there is no choice of mro provider.” Jon Sharp, president and CEO, ELFC An example of the OEMs’ continued expansion into the MRO business, according to Steve Williams, director of technical purchasing at AJ Walter Aviation, can be seen with Snecma’s growth in its services divi- sion by purchasing or creating various commercial ventures, such as its Snecma Morocco, Snecma Brussels and Snecma Americas subsidiaries. Snecma has also diversified its product offering to increase its market share and now offer a full range of component repair services directly from the Snecma Chatellerault facility, to their own engine shops and the various airline facilities such as Finnair and Iberia, allowing them to “Aerodynamics capture an even greater amount of the market. are for people As a result, says Williams, the independents are left to compete for a who can’t decreasing percentage of shop visits. The only good piece of news for build engines” them is “the continued expansion of the global airlines market over the last decade and the subsequent growth in the MRO sector. This has Enzo Ferrari masked the effect of a lower percentage of engines available to the independent provider.” That reduction in the supply of repair facilities for the customer is ‘not healthy’, according to ELFC’s Sharp. Leasing companies own 32% of Contact us today and see what AJW the aircraft order backlog, he explains, and so should have an impor- tant voice. “Lessors do not like these all-inclusive care packages, be- can do for you. cause there is no choice of MRO provider: the OEM keeps the main- tenance reserves, thereby reducing lessor security and the portability aviation of the fund accumulated from one lessee to the next is questionable. If airline shops and third-party independent MROs are to stop the ero- sion of their market share, they have to develop competing packages and somehow get them in at the point of sale of the engine.” Enrique Robledo Martín, director of power plant maintenance at Ibe- A J Walter Aviation ria Maintenance, agrees that reduced competition means ‘less cost www.ajw-aviation.com reduction presures and less overall improvement’. “In other industries, tel: +44 1403 711777 like the pharmaceutical industry, there is an agreement which allows email: firstname.lastname@example.org the research and development return for 10 years, after which com- Visit us at Airline Purchasing & Maintenance Expo, 4-5 May, Olympia Grand Hall, London UK, Stand K8 cover story - engine maintenance 12 petition is promoted, GE’s Ovington says that many of his customers which reduces the price have chosen to go the OEM route because of of medications. I think ‘relationships beyond services’ and the ‘broad- this industry needs to er support’ offered through solutions like GE’s think in the long term OnPoint, which offers “low cost of ownership, and find solutions to with world-class fulfillment, customer support promote competition and commercial flexibility. Beyond maintenance in the engine mainte- needs, customers are also looking for way to nance sector.” better manage all the data that they have, and GE Aviation has developed myEngines, which Indeed, this lack of consists of digital app suites to help customers Steve Williams of AJ competition could even better manage this data.” Walter Aviation throw up serious anti- trust issues, according Ovington underscores the mutually beneficial to Charles Willis, who says OEMs should be arrangements with its network of independ- ‘careful about whether they’ve really sold their ent shops. The choice of MRO providers for engines’ through their warranty programs, or airlines which operate GE and CFM-powered whether they in aircraft fact still have ef- “the oems are picking up an ever-increasing differenti- fective economic ates us, and operational portion of the available mro business. the he says, control over them. only good piece of news for the independ- “from oth- He says that les- ents is the continued expansion of the global er engine Weld repair process on a CF6-50 combustor dome Jet Aviation Specialists sors and airlines airline market over the last decade and the OEMs, and alike tend to be we believe zaz works with many shops that pride them- ‘suspicious’ about subsequent growth in the mro sector.” customers selves on OEM-quality standards of work, fre- OEM intentions Steve Williams, director of technical purchasing, AJ Walter value this quently have shorter lead time TATs and offer when they see choice.” lower prices. hourly repair management or total care agree- Even so, there are many who believe that inde- ments. “The airlines continue to want alterna- Iberia’s Robledo points out that independents pendent MROs have the agility, the skill - and tives to the OEMs.” and third-parties can offer a set of solutions the hunger - to outplay the OEMs at their own game. Mike Cazaz, president of asset man- that the OEMs “normally do not have: com- WhaT’S a 3Rd-paRTy mRo To do? plete operational support for components, With GE holding 12% of the global engine agement company Werner Aero Services, says there are ‘many independent shops that do airframe and engines, focus on repair and not maintenance market, double the share of the replace, offers for non-OEM parts and repairs, next entrant, LHT (and three times that of third- just as good a job (and sometime better) than OEMs. They’ve invested in tools, expertise and operator experience and, for ageing types of placed Delta TechOps) and Snecma, through its engines, they probably know the engines bet- 50% stake in CFMI, holding fourth place with technology to handle the specialized work. And let’s face it, OEMs, in their current capac- ter than the manufacturers themselves”. 4%, it’s clear that OEMs are the ones to beat - and that they take a lot of heat from their rivals. ity, can not handle the amount of work on the When they’re not tied down by long-term total engines that are out on the market today.” care-type deals, airlines can afford to pick and But it’s hard to ignore the benefits of a total- The three key buying factors that airlines con- choose the best deals; indeed, they are increas- care type deal with an OEM for many carriers, sider when choosing an engine MRO partner, ingly driven by necessity to pressure service particularly those with big fleets, which will quality, cost and turnaround time (TAT) can providers for the lowest-cost solutions in this get attractive service packages as part of their turn the tables in an independent’s favour. Ca- post-recession era coloured as it is by rising oil original engine deals. prices and cut-throat competition. A key area for cost reduction, and a subject that we’ve been leading up to, is, of course, the issue of PMA parts. AJ Walter’s Williams believes that airlines are ‘increasingly accepting of the use of PMA material, Designated Engi- neering Representatives (DER) repair schemes and the use of used serviceable material - all of which have a major impact on the cost of a shop visit. Obviously, the OEMs have a natural resistance to some of these key parameters, and this provides the independents with a con- siderable cost advantage”. One airline supply chain executive summed it up by saying, that from an airline point of view, “more and more PMA parts are being developed for new generation aircraft. I would certainly install PMA parts if they save money. ” (see Engineers at work in Iberia Maintenance’s engine shop Iberia overleaf for more on the PMA debate). AviTrader MRO - April 2011 cover story - the pmA Debate 13 Weighing in on the PMA debate: Where we are now The issue of ParTs ManfacTurer aPProval (PMa), or The use of parts manufactured by firms other than an OEM, continues to ignite fiery debate in the MRO sector – especially in the USA, where industry leaders like Chromalloy, Heico and Wencor have been supplying the industry with PMA parts for decades. This month is significant in that a 2009 FAA revision to US regulations harmonizing standards for aircraft parts comes into effect. As of April 16th, regulations for all quality systems will be the same for all production approvals – whether implemented by OEMs or by PMA manufactur- ers. In reality, there won’t be any major changes, because all manufacturers have been held to the same standards, but the process will now be clearer in FAA regulations. The total annual PMA spend, estimated to be $400 million, is a very small percentage of the overall parts outlay, but it is likely to grow as airlines look for new ways to contain costs in an era of spiking fuel costs. There is strong resistance from OEMs, which have been successful in locking up carriers in long-term ‘total care’ type contracts, as well as lessors concerned about residual values of their stables of aircraft and engines – but with oil at over $100 a barrel these days, PMA parts and non-OEM Designated Engineering Representatives (DER) repairs costing at least 30% less than those offered by OEMs begin to look increasingly attractive. The key distinction is where the PMA part is used. “We all fly planes with PMA parts,” said one executive. When an OEM-manufactured sign asking passengers to ‘Please wipe the basin after use’ costs $450 and a similar PMA sign costs $80, the decision to go PMA is not very difficult. But move on up the food chain to highly safety-relevant parts, and the rules change: “Yes, we’ve seen an opening up in recent years, but the ‘no-go’ area remains engine gas path parts,” said another. They look like the real thing... GE‘s position is clear: “GE continues to be concerned with part-level changes introduced via PMA,” Jeffrey A. Conner, director of Alternate Material Strategies for GE Aviation, told AviTrader MRO. “Existing FAA rules regarding PMA (and repair) allow for the introduction of design, material and/or manufacturing process changes at the part level without the involvement of the Type Certificate Holder for the engine into which the changes are being introduced. Maintaining continued airworthiness of aircraft engines requires a rigorous assessment of the impact of part-level changes on other parts, sub-systems and systems in the engine, especially with respect to life-limited parts (LLP) and engine operability. Influencing parts define the bounday conditions under which LLP operate. GE believes current FAA rules and guidance material “do not ad- equately address system level interactions, and, thus, may not ensure the continued airworthiness of turbine engine LLP when part level design changes are introduced on critical influencing parts”. Regardless of when in the life cycle of an engine replacement parts are introduced, GE’s concern centers around “management of the mixed engine configurations that result from introduction of design, material, or manufacturing process changes at the part level. Introduction of multiple replacement and modification parts, each embodying these changes versus the type design, create unique configurations that have never been tested at the system or engine level. The resulting combination of parts (i.e. the engine) has never been tested as a system to demonstrate compliance with FAA or EASA engine-level certification requirements or to validate the applicability of Instructions for Continued Airworthiness published for the engine by the Type Certificate Holder.” It’s a fair assessment. While the constituent PMA parts of an engine may have met FAA airwor- thiness standards, the combination of these parts, when put together in the repair of an engine, have not. But companies like Chromalloy, which manufacture gas path components, stand by their assertion that PMA parts meet the same airworthiness standards as OEM parts and that while the use of PMA parts has grown substantially over the past two decades, the number of airworthiness directives has not. PMA parts and DER repairs for gas path components can cost an airline up to 50% less than similar parts and work from an OEM. Chromalloy specialises in the manufacture of highly safety-relevant engine parts. Its BELAC subsidiary, which produces high-pressure turbine blades, is part-owned by Lufthansa Technik and United Airlines, indicating a significant involvement of major MRO players in the develop- ment of PMA in critical areas. Other firms like Heico and Wencor focus more on non-critical .. but do they work like the real thing? PMA engine parts and seals. consumables and expendables. Both photos courtesy of Wencor Whatever the destination of the part, Wencor president Russ Adamson says that “PMAs are crucial for an independent MRO shop to compete with OEMs. If MROs only rely on the OEM, they will always be at a disadvantage because they are fundamentally competitors. MROs can be most successful when they partner with low cost parts and labour.” The cost issue is clear, but the perception of quality remains controversial. Companies like Chromalloy, with backing from LHT and United, insist that FAA approval equates to airworthiness, whether it be PMA or OEM-built, and that lingering doubts over quality are fomented by OEMs determined to protect their business. As the majority of aircraft in operation today are leased, it’s the lessors, then, with remarket- ability as their raison d’être, that share the driving seat with the OEMs. “It’s not a debate about whether to use PMA parts or not,”, said one industry source. “It’s about finding the cheapest part. But without PMA, we’re at the mercy of the OEMs. The builder and the lessor are controlling the show.” AviTrader MRO - April 2011 Cover Story - The PMA Debate 14 Weighing in on the PMA debate: What they‘re saying - and why JEFFREY A. CONNER, Director of Alternate Material RUSS ADAMSON, President, Wencor: “There is a shift happening Strategies for GE Aviation: “Lessors that GE has spoken where most lessors realize they have customers who want to use PMA with focus on the criticality of parts. Many airframe parts, window parts and are willing to discuss this at the contract negotiation stage. shades and tray tables, for example, are not critical to the safe The perception is that remarketing an aircraft is impeded by PMA. The operation of the aircraft. Consequently, the use of PMA parts for fact is that FAA-approved parts on an aircraft do not reduce its value. these applications would not be a concern to the lessor. However, Bilateral agreements throughout the world make the remarketing these same lessors typically take a much different approach with argument very ﬂimsy. PMAs are crucial for an independent MRO shop respect to use of PMA in engines where even “simple” parts can to compete with OEMs. Upwards of 70% of the costs associated with have signiﬁcant impact on engine operability and life-limited parts a component maintenance shop visit is tied to spare parts that need management as a result of system interactions.” to be installed. If MROs only rely on the OEM they will always be at a disadvantage because they are fundamentally competitors.” CHOO HAN KHOON, Executive VP, Engine Total Support, ST FRANK WALSCHOT, SVP Engine Maintenance, SR Aerospace: “Many OEMs align themselves with major service Technics: “PMA is, and will continue to remain part providers like ST Aerospace, especially in view of our preference in of our business, but the growth for engine parts may using OEM solutions for after-sales support and our responsible at- be limited due to lack of acceptance by certain key titudes in ensuring their intellectual property is protected. We see players such as leasing companies. Also, more recently- this as a win-win approach in offering our services.” offered OEM material solutions and product upgrades make PMA parts less attractive. However, as engines mature and move into different carrier segments, JON SHARP, President and CEO, ELFC: “PMA is there is still some room for some further development not a big issue for ELF as our ﬂeet is very modern on engines with a signiﬁcant installed base.“ and not much PMA exists for new engine types. Neither do I think that PMA is such a big issue world-wide in proportion to the amount of hot air HUMBERTO PALHA, Quality Assurance General Manager, TAP it generates. Maintenance & Engineering: “Although TAP Maintenance and Engin- “The acceptable PMA and DER is typically on eering has no objection to using PMA parts listed on the FAA database, non-critical parts. No engine lessor would accept the company has as a policy to ask all its customer whether PMA parts PMA in the engine gas path for example. We do can be used on their aircraft. So, only after customer acceptance can TAP not accept PMA because some airlines don’t, so Maintenance and Engineering consider the use of PMA parts.” we would be excluded from leasing to them if our engine had PMA in it. “PMA is not such a big deal. It is a tiny percentage STEVE WILLIAMS, Director of Technical Purchasing AJ Walters: of parts spend. The bigger issue is DER. Third- “Going forward, the use of PMA’s is going to rise; the development party MROs have to develop this activity to combat of PMA’s is increasing and the acceptance of the airline comunity the total care type growth of the OEM MRO par- is helping to drive this phenomena. However, with the growing ticularly on new engine types.”. availablity of used serviceable material in the market place and the ever-increasing use of more exotic repair schemes, the need for PMA is reducing. MROs like LHT are trying to reach a 100% yield for some ABDOL MOABERY, President, GA Telesis: “We do repair processes and once achieved this makes the requirement for not allow PMA parts to be installed in our leased engines PMA virtually obsolete for an ageing engine.” without our prior written approval. While there are limited areas where we will consider it, we feel that PMA parts limit our ability to effectively lease or repair our engines globally RICHARD POUTIER, SVP, ILFC: “PMA parts are not controversial to without restrictions. us. We have industry standards: the FAA, EASA, China’s CAAC are all working together to harmonize the industry. If they approve the We have seen PMA manufacturers develop parts for engines PMA process,for a non-critical part, I’ll put my faith in it. We ALL ﬂy still in production, for example the CFM56-7B. We do not aircraft with PMA parts in them. It’s a question of cost-efﬁciency. Air- think this makes much sense as the potential beneﬁt of a lines can’t do without them. PMA parts in some cases are the avenue PMA part is to reduce costs on parts for an ageing engine.” ANDREW WALMSLEY VP Sales & Marketing, Jet Aviation Specialists: “An issue with PMA parts has been the OEM’s push to not accept these parts for repair or installation back into engines. What this has meant is that most of the brokers are accept- ing this condition (no PMA), so that it does not restrict their ability to move inventory. In effect the OEMs have been successful in inﬂuencing the market beyond their own facilities and needs.” Background photo: The highly safety-relevant PMA High Pressure Turbine Blade produced by Chromalloy’s joint venture company BELAC, co-owned with LHT, United and Alitalia Chromalloy AviTrader MRO - April 2011 The Most Critical Performance Measure of Your Supply Chain Partner Occurs at 38,000 Feet There are many measures of performance, but let’s face it, the most critical is when your aircraft is in route. Contact GA Telesis and find out why the world’s largest airlines choose GA Telesis components and MRO services to help boost their on-time performance. Remember, your job is in the sky, our job is to keep you there. www.gatelesis.com industry interview 16 Charles Willis, president and CEO of Willis Lease: On engine leasing, past, present and future CHARLES WILLIS IS REGARDED AS ONE OF THE PIONEERS of the aircraft engine leasing business. He is the founder, president and chief executive of the highly-regarded independent engine leasing firm Willis Lease, which today has a porfolio worth well over $1 billion. With a business acumen built up over 40 years in the aviation industry, Willis was notably able to steer his firm profitably through the downturn of 2008-09, a time when many of his rivals struggled. Successful businesspeople have usually had their share of hard knocks on the way up, and Willis is no excep- tion. Born in Boston, raised in New York state and Alaska, and educated partly at a boys’ boarding school in small-town Canada, Willis’ first taste of the airline industry was north of the 49th parallel, in Alaska, in fact, after his father, a decorated World War II pilot, took over a near-defunct Alaska Airlines in 1957. He worked at the airline in a sales and operational capacity until his father left during a board dispute, whereupon he soon jumped ship as well to found his first engine leasing business, the Charles F. Willis Company. Why engine leasing, you might ask? Willis explains that he did not have a formal university education and “as such couldn’t get a regular job. I also felt there was a need for engine leasing as GPA and ILFC had just begun in the aircraft sector. The difference from them was that I started it with no capital at all. We just built it one engine at a time over the next 35 years.” “I was constantly in debt and no one - none of the banks - would provide funding. No one really understood nor cared about engine leasing. In fact, I even published a newsletter called World Aero-Engine Review, with the aim of informing banks and airlines about the benefits of engine leasing. The first 10 years were very difficult.” Times have certainly changed for Willis, who now lives in London and divides his time between the UK and the USA. AviTrader MRO spoke to him from his offices in London where he shared his views on the past, present and future of the engine leasing business: (In June 2010, AviTrader MRO reported that only around 1% of spare engines were leased in the early 1990s, a figure that rose to 10% by 2000 and to close to 25% today. Forecasts suggest that close to 40% or even more of spare engines will be leased by 2020). On the expansion of the engine leasing market: The market has expanded because engines have become so expensive. Also, airlines realize they don’t want assets to sit idle for extended periods of time. Newer engines are in greater demand and older engines are seeking their level pricewise. Demand is constantly increasing, especially with the advent of pooling. For example, airlines last year saved a minimum of approximately $200 million through pooling. They do not have to purchase engines to get their support. This will continue and grow. On maintaining independence: At Willis Lease, we are able to make decisions in a very short period of time without going back to home office or multiple committees. It is an advantage being independent as you can deal directly with all OEMs and airlines. Furthermore, we are able to participate in areas such as pooling that captives can’t. We are always open to offers for financial and or strategic partners. It is my fiduciary responsibility to seek the best value for our shareholders. On the OEM share of the spare engine leasing market: (The OEM share of the spare engine leasing market has tripled in the past 10 years:AviTrader MRO June 2010) . Much of the OEM leasing activity is done to support their warranty programs. OEMs still want to be able to book the sale of their engines and as a result they have to be very careful not to keep either the engine’s economic ownership and / or support position in their ownership realm. There is a serious anti-trust and accounting question as to whether or not the OEMs really have sold their assets as they still have effective economic and operational control of them. I think there will be room for independents though the barriers to entry are quite large at this point. On Willis‘ recent agreement with BAE Systems: We expect BAE Systems to help broaden our abilities to capitalize on opportunities in the pre-owned aircraft space. There were other companies in the running, but we felt BAE had a broader reach and capability. We also felt that we could also grow this business together. BAE Systems has a brief to target aircraft carrying engines made by all manufacturers, although some engines could be hard to come by as the manufacturers have effectively shut out lessors from their market by the use of flight hour agreements, MRO-managed capacity and for the time being, partnerships. So it really would be a waste of our time and assets, not to mention a very questionable residual value play as the OEM controls the market. On the future of the engine leasing business: I think there will be more pooling programs in the future. For example, we are currently pooling CFM-56-7/5/3 engines on three continents. We are beginning CF-6-80 C2/ V2500/PW 4000/PW 100/CF-34 engines pools as well. I think there will continue to be few lessors in our sector. As I mentioned earlier, the barriers to entry are substantial: you need capital, technical staff, economically-priced engine portfolios and true knowledge of the world markets. I also believe we will be doing a far larger amount of potential business in regional, turboprops, widebodies, helicopters, industrial and power gen- eration aero-engine derivitives. I think most MROs will exit leasing , as it is not their core business and it exposes them to operational, residual and credit risk. I further believe the OEM will be more careful about anti-trust considerations and work more closely with lessors such as ourselves. The airlines are also very suspicious about OEM intentions when they see hourly repair management or total care and or thrust-by-the-hour agreements. Someone once said if it looks like a duck, walks like a duck and quacks like a duck, it probably is a duck’. The airlines continue to want alternatives to the OEM. 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IBA president and COO Phil Seymour makes it clear tHe coNcepts to manage seasonal variations in its volume further performance Engine maintenance is a preventative process: of flights, or because the availability of a spare restoration. that is, it is designed to prevent failure tak- engine means that the aircraft need not be The airline will mon- ing place. This is both the safe approach to grounded while the work takes place. itor key perform- take, and the economic one, as it is cheaper Removal reasons A and C above are relatively ance indicators via to maintain a functioning engine than repair easy for the airline to control. Regarding rea- reports from pilots a broken one. son A, the LLP life is known and utilisation of who have to write While engines as a whole can be ‘On Condi- the aircraft/engine reasonably predictable, and down the engine tion’, some of their components are still sub- reason C is an operator made decision. Reason indication figures at ject to ‘Hard Time’ limits. B is specific to each engine and therefore much certain points in the IBA’s Phil Seymour closer monitoring and inspection is required to flight and these are collated and reviewed as An ‘On Condition’ engine is only removed from predict the timing for this removal reason. so called ‘trend analysis’, this process is auto- the aircraft when there is a specific reason for mated in the latest aircraft types. There may be that removal. There are a range of different eNgiNe performANce: HoW it is times that the results indicate wear and tear to such reasons; broadly speaking, they are that: moNitoreD AND HoW it cAN be the engine that need a physical inspection to restoreD see if damage has occurred. A) An LLP has reached the end of its per- Engine technology has developed consider- missible life and must be replaced (an LLP is a ably in the last fifty years. In previous years en- Any observations, such as nicks, dents, cracks ‘Hard Time’ component even in the context of gines were maintained at a fixed (hard) life and and burning, will be assessed in accord- an engine or a module which may as a whole underwent ‘overhaul’ – every part of the en- ance with the Aircraft Maintenance Manual be an ‘On Condition’ item); or gine was disassembled, inspected and replaced (AMM). The AMM is used whilst the engine B) The exhaust gas temperature (EGT) has with repaired or new parts where necessary. is attached to the Aircraft. The AMM allows increased to a certain point which the operator continued operation of engines using limits considers, or the AMM indicates, is unaccept- Airlines demanded more flexibility and cost which would not be used if the engine was able; or part of the engine fails one of the reduction as technology and materials im- undergoing a shop visit. When the engine has checks included in the list of on-wing mainten- proved during the 1970’s. Most modern day been removed and is in the workshop the En- ance tasks set out in the MPD, such as a boro- engines offer such flexibility, with no fixed gine Manual limits are applied. scope inspection, or other indication or trend life other than the life limited parts and the ability to reduce the workscope from the old With a new engine the pressure retention, air analysis, suggests a problem; or flows and rotating assemblies provide a highly fashioned ‘overhaul’ to ‘performance’ or C) The operator, in order to ensure that the ‘minimum or limited’ workscopes. efficient assembly. So, when an aircraft waits engine can remain in service for a given period at the end of the runway for take-off there into the future, decides for operational or eco- Airlines have to balance the ‘lower’ level of is a fairly simple set of performance criteria nomic reasons that it is a convenient time to workscope which will result in a lower cost that must take place in order for the aircraft conduct off-wing maintenance: for instance, but also a lower time until the engine requires to safely become airborne. A GE90 engine on its way for performance restoration Patrick Delapierre / AFI KLM Engineering & Maintenance AviTrader MRO - April 2011 ibA Analysis - engine maintenance and egt margin 19 Firstly, the pilot will know how heavy the aircraft Whilst the EGT is the most important single is, the temperature, and the pressure of the air- parameter, the benchmark of the overall en- port, resulting in a take-off speed for the aircraft gine efficiency is the EGT Margin which, in very (known as V2 – the speed at which the aircraft simple terms, is the difference between the en- can safely take to the air). The pilot will also gines current maximum EGT compared to the know how long the runway is and how quickly absolute limit. the aircraft will need to reach its V2 speed. The engine manufacturers provide a generic As mentioned above, this precise speed will vary deterioration rate of EGT per 1,000 cycles and from day-to-day and airport-to-airport depend- over time the airline will be able to predict, ing upon the actual conditions. The aircraft flight with reasonable accuracy, its own deterioration manual will provide the pilots with an engine rate based upon its specific ‘modus operandii’. power setting that will achieve the required V2 Clearly each airline operates from different air- speed in the runway distance available. ports and runway lengths, at different times of the day and with different loads. An airline The engine power setting is known as ‘Engine operating from a hot and/or high environment Pressure Ratio’ or ‘EPR’. Simply put, this is the will find that its engines will deteriorate more indicated pressure ratio comparing the entry rapidly than an airline operating in the relative pressure into the engine, to the exhaust pres- calm of Northern Europe (that is, the EGT mar- sure. To reach the required EPR the pilot must gin deterioration will be more rapid). Airlines provide the engine with fuel via the engine may be able to operate engines at a lower throttle in order to increase the speed of the thrust rating than the flight manual requires compressors to provide the increase in pressure. by extending an aircraft take-off run and/or Maintenance check on a JT8D engine ST Aerospace For a new engine, being relatively efficient, climbing at a slower rate. This not only reduces the amount of fuel required to be burnt at the the wear and tear on the engine, but is also a therefore result in higher temperatures being combustor, which will drive the turbine, which noise abatement policy in built up areas. This is generated in the combustor – the higher the in turn will drive the compressors, will result in generally referred to as ‘de-rate policy’. amount of fuel the higher the temperature. a relatively low Fuel Flow. (Fuel Flow is meas- A typical EGT margin for a new narrow-body The materials used for aircraft engine will be in the order of 60 de- The restoration of the EGT margin to a sufficient the combustor and high grees centigrade. Typical degradation of the pressure turbines are level for an economical period becomes the made from high grade EGT margin will be in the order of 12 degrees primary objective of the shop visit. metals and alloys. How- for the first 1,000 cycles (as the engine ‘beds in’) and thereafter at around 4-6 degrees per ever, if certain temper- 1,000 cycles. An engine that has been through ured in kilograms per hour and at take-off is atures are exceeded they will fail and cause a performance restoration shop visit in accord- typically 3,600 Kg/hr). considerable damage to the engine. Engines ance with the manufacturer’s workscope plan- that suffer failure at high temperature will al- ning guidelines, will achieve an EGT margin of eNgiNe WeAr AND teAr AND its most always be beyond economical repair. around 35 to 40 degrees centigrade and de- impAct oN egt Therefore the most critical of all of the indi- grade at a similar rate to the new engine. I would now like to look at a similar process but consider that the engine has been in use cated parameters is the many thousands of hours and has performed Exhaust Gas Temperature it is not surprising that aircraft lease contracts thousands of take-offs and landings. (EGT), and it is the restora- usually contain a specific clause that refers to tion of the EGT margin to the required egt margin of each engine at The rotating blades and stators will be worn. a sufficient level for an The relevant seals between the various stages economical period that be- redelivery of the aircraft. of the engine will be worn. The engine bear- comes the primary objective It is therefore probably not surprising, given ings will be less ‘tight’ and free running than the of the shop visit. the importance of EGT margin, that aircraft new ones. There will be nicks, tears and erosion of parts in the compressor combustor and tur- If I refer back to the situation of the pilot look- lease contracts usually contain a specific clause bine areas. The hot areas of the combustor and ing to reach a certain EPR for take-off, in the that refers to the required EGT margin of each turbine will have burning and warping. worst case he may find that the required EPR engine at redelivery of the aircraft. The EGT cannot be produced without reaching the margin therefore needs to be carefully man- Therefore as the engine hours and cycles in- maximum EGT limit. aged in the period leading up to an aircraft re- crease the amount of fuel required to provide turn, to prevent arguments occurring between the same EPR will have increased from its new If the EGT limit is exceeded a warning light will lessors and lessees. condition state. This is because the ‘tired’ com- illuminate and the length of time the engine pressors and turbines will have to run at faster operates in excess of the limit must be noted The International speeds in order to generate the same EPR, as by the pilot (this is automated in some aircraft/ Bureau of Aviation is an the wear and tear will have increased the ‘gaps’ engine combinations). I have known several independent aviation between the parts resulting in pressure losses. cases where the engine has failed after exceed- consulting firm based in Leatherhead, ing the EGT limit and the costs can be many UK, with representation worldwide The increased amount of fuel required will millions of dollars. AviTrader MRO - April 2011 Minimising Risk Maximising Opportunity JET VALUES 2 In the 23 years following its incorporation in 1988, IBA has evolved to JV2 is a powerful, yet cost-effective, become one of the world’s foremost aviation consultancies, serving the online aircraft valuation tool, giving commercial and technical needs and aspirations of the aviation you access to IBA’s expertise 24 community in all its dynamic diversity. hours a day, seven days a week. Being a privately-owned and entirely independent corporation we are “IBA’s JV2 online valuation system is able to offer a seamless service without the risk of incurring a conflict an exceptional tool for the analysis of interest. Our advice and recommendations are supported by years of existing and potential aircraft, of solid data and reliable, in-depth research. aircraft fleet values and for conducting ‘what if’ scenario We are UK based with offices in Leatherhead, Surrey, which is analysis. 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IBA Group Limited | IBA House, 7 The Crescent, Leatherhead, Surrey, KT22 8DY, UK Telephone: +44 (0) 1372 224488 www.ibagroup.com Email address: email@example.com www.jetvalues2.com selected it News 21 LAN Goes Live with Enterprise-Wide Implementation of Mxi Technologies’ Austrian Airlines receives FAA Maintenix Software Approval for electronic signa- Mxi Technologies announced that LAN Airlines (LAN), Latin America’s leading domestic and interna- ture in AMOS tional passenger and cargo carrier, has gone live with an enterprise-wide implementation of Main- tenix. “The decision to migrate from our legacy system was based on our need for a sophisticated Swiss-AS announced that Austrian system that would support LAN’s dynamic business environment,” said Ruy Lotz, Technical Support Technik, the technical operations director, LAN. Mxi Technologies’ Maintenix software replaces LAN’s legacy VISaer system — along- organisation of Austrian Airlines, side more than 20 other internal sub-systems — and serves as the single source for maintenance recently received the FAA approval information across the organization, fully integrating with their ERP backbone. for “FAA Operation Specification”. The Part 145 organisation is now allowed to use the AMOS e-signa- ture in the context of - FAA Form 8130-3. In addition, the usage of the AMOS e-signature solution at Austrian Technik has been approved by Austro Control GmbH, the of- ficial Austrian civil aviation agency, for - EASA Form 1 (double release). Austrian Technik is now the first Eu- ropean EASA Part 145 organisation having completed the appropriate authority approvals and operational implementation of electronic signa- ture in AMOS. AirTeamImages BAA outsources IT services to New Polish airline Yes chooses Commsoft’s OASES to support operations Capgemini consortium Yes Airways, a new Polish airline, chose Commsoft to provide it with market leading software Airport company BAA is outsourc- systems for managing the maintenance of its fleet. Yes has chosen Commsoft’s Open Aviation ing the delivery of its IT services to a Strategic Engineering System (“OASES”) to support its planned charter operations with Airbus consortium led by Capgemini UK plc A320 aircraft. Yes will be operating two Airbus A320s and the airline plans to expand, adding at in a five-year contract valued at ap- least four more aircraft over the next two years. The flexibility of the OASES system means that proximately £100 million. BAA says Commsoft can extend the support it offers to Yes as it grows, adding more modules as the client that the move will be key to improv- requires them. Commsoft will help rapidly implement OASES so that Yes will be able to quickly ing the airport experience for all its obtain CAMO approval and begin operations as planned in late April this year. stakeholders, including passengers, staff, airlines and retailers, at Hea- Carson Helicopters goes live with Pentagon 2000SQL system throw and the company’s other five UK airports. The consortium, assem- Pentagon 2000 Software reported that Carson Helicopters, a Perkasie, PA-based helicopter repair bled and led by Capgemini as prime station, has gone live with the Pentagon 2000SQL system to run its operations. Business functions contractor, includes SITA, Atkins, ranging from core accounting & financials to Maintenance Repair & Overhaul are now managed by Computacenter and Amor Group. Pentagon 2000 Software’s flagship solution. Carson Helicopters conducted an extensive search of commercially available aviation software and determined that Pentagon’s advanced functionality Capgemini UK plc is part of the and fully integrated architecture made it the clear choice. Following a successful implementation Capgemini Group, one of the fore- project, Carson is now fully operational with the new system and is realizing the benefits identified most providers of consulting, tech- in the selection process. nology and outsourcing services. Capgemini will be responsible for Volartec launches Alkym 5 with new features for enhanced productivity the delivery of BAA’s core IT serv- ices on a day-to-day basis, includ- Software company Volartec launched the latest version of its Alkym system for aircraft mainte- ing applications, infrastructure and nance management and control. Alkym 5 is a complete re-design of the original software that projects, for some 10,000 users. provides access to all functionalities through a new user interface, more customization, improved The service will cover BAA’s six UK optimization on scheduling and material resources utilizations and online access to the system’s airports and will start in May after Documentation and Download Centre. a two-month transition. BAA will retain responsibility for IT strategy, Piedmont Aviation selects Quantum Control Aviation ERP Software stakeholder management and en- suring the quality of IT services in Piedmont Aviation Component Services, a wholly-owned subsidiary of TAT Technologies and an collaboration with Capgemini. Some FAA/EASA Part 145 repair station based in Kernersville, N.C., recently selected Component Con- 200 staff will be eligible to transfer trol’s Quantum Control aviation enterprise resource planning (ERP) software to streamline opera- to Capgemini and its partners under tions at multiple facilities. Piedmont Aviation will have up to 80 concurrent users on Quantum TUPE conditions. when the system goes live later this year. AviTrader MRO - April 2011 News in brief 22 Curtiss-Wright signs deal with Boeing PPG Industries qualifies chromate-free exterior primer with Boeing Kellstrom signs consignment deal Curtiss-Wright Corporation was selected by with ANA . . . . Boeing to provide emergent and specialty PPG Industries qualified a chromate-free ex- production support for the final assembly and terior decorative primer with Boeing, ena- Kellstrom Commercial Aerospace signed a delivery of the 787 Dreamliner in South Caro- bling airlines, subcontractors and third-party consignment agreement with ANA to sell lina. Under the contract, Curtiss-Wright’s Mo- painters to specify a complete “green” PPG excess Airframe and Engine material for the tion Control segment’s facility in Shelby, NC, Aerospace coatings system for new or re- 777,737NG, 747-400, CF6-80C2, CFM56 and the Metal Treatment segment of Curtiss- painted Boeing aircraft. DESOPRIME CF/CA and PW4000 platforms. Wright, together will provide emergent and 7502 epoxy primer is the only chromate-free specialty production of components to Boe- primer on Boeing’s qualified product list for . . . and expands global distribution ing’s 787 final assembly facility in South Caro- its BMS 10-72 (Revision Y) Exterior Decora- agreement with AMETEK Aero- lina on a 24/7 basis. tive Paint specification. PPG Aerospace now space & Defense offers a complete green exterior coatings system qualified to BMS 10-72 that includes Kellstrom Commercial Aerospace expanded AJ Walter Aviation acquires site for DESOTHANE(R) HS topcoat and DESOGEL its global distribution agreement with AM- global HG and logistics centre ETEK Aerospace & Defense to include ex- EAP-9 metal pretreatment. AJ Walter Aviation acquired a new site for clusive worldwide distribution of AMETEK the development of a significant global HQ Rotron Commercial aftermarket products. StandardAero ODA issues STC for and logistics centre close to Gatwick Air- As part of the agreement, Kellstrom will Falcon 900C/EX Primus Elite cockpit also provide 24 hour a day, seven day a port in the UK. The site is on a footprint of over 60 acres and will initially provide over display week AOG support to all of Rotron’s OEM 175,000 square feet of purpose-built office StandardAero Business Aviation announced customers globally. and storage facilities for AJW’s extensive that it has issued the first Supplemental Type range of Airbus and Boeing components, Certification (STC) to replace aging Cathode engines and consumables. Lufthansa Technik receives certifica- Ray Tube (CRT) cockpit displays on Falcon tion for APS 2300 900C/EX aircraft with modern, state-of-the- . . . and wins supplier approval re- art, Honeywell Primus Elite (DU-875) Liquid Lufthansa Technik’s Auxiliary Power Unit (APU) newal from Qatar Airways Crystal Display (LCD) displays. This announce- shop is expanding its service range with the ad- ment effectively positions StandardAero dition of the Hamilton Sundstrand APS 2300 to Qatar Airways Technical Division renewed Business Aviation for additional installations its portfolio. The Hamburg-based APU shop re- its supplier approval of A J Walter Aviation, following an industry-leading install and Or- ceived the certification of the German Federal the integrated aviation spares support spe- ganization Design Authorization (ODA) proc- Office of Civil Aviation and is offering mainte- cialist. Every year AJW successfully wins or ess. As developer and owner of the STC, nance, repair and overhaul services for the APS renews approvals with over twenty-five air- StandardAero Business Aviation is the first 2300 to customers with immediate effect.The lines, airline engineering and OEM custom- maintenance, repair and overhaul (MRO) pro- APS 2300 auxiliary power unit (APU) built by ers from across the globe. It currently holds vider certified to perform the installation of Hamilton Sundstrand is used in Embraer’s E-Jet over 250 individual customer approvals and Primus Elite on Falcon 900C/EX aircraft. 170/190 family. Now that the first types in this has been providing Qatar Airways with full quality assurance since 2005. trANsActioNs iN brief MHI commences Mitsubishi Regional Jet assembly work Boost for EADS as it acquires Canadian MRO Vector Mitsubishi Heavy Industries Ltd. (MHI) and Mit- Eurocopter Holding, a subsidiary of EADS and Vector Aerospace entered into a support agree- subishi Aircraft Corporation jointly announced ment by which Eurocopter Holding will acquire all of the issued and outstanding common shares the commencement by MHI of assembly work of Vector Aerospace in a deal valuing Vector Aerospace equity at approximately C$625 million. on the next-generation Mitsubishi Regional Jet Vector, a provider of multi-platform helicopter MRO services and of rotary and fixed-wing air- (MRJ). Based on an order placed by Mitsubishi craft engine repair and overhaul, will become Eurocopter‘s independent multi-platform MRO Aircraft, which is developing the MRJ, MHI be- services provider. Vector will maintain and develop its world-renowned brand name. In 2010, gan riveting work on the frame structure sur- Vector Aerospace generated a turnover of C$545 million (€400 million) – roughly the equivalent rounding the emergency escape hatch for crew of a quarter of Eurocopter’s current Support and Services turnover (€1.7 billion). in the cockpit roof of the aircraft. While manu- facture of individual parts had already begun Goodrich Corporation signs agreement to acquire Microtecnica last autumn, the start of assembly work indi- cates that the MRJ project to develop Japan’s Goodrich Corporation signed an agreement with SSCP Aero Holdings to acquire Microtecnica, first passenger jet is progressing as scheduled. a provider of flight control actuation systems for helicopter, regional and business aircraft, mis- sile actuation, and aircraft thermal and environmental control systems. Total cash considera- Turkish Technic signs APU repair serv- tion for the acquisition is approximately €330 million. ices contract with GECAS Volvo Aero becomes sole owner of Volvo Aero Norge Turkish Technic and GE Capital Aviation Servic- es (GECAS) signed an APU repair services con- Volvo Aero is acquiring Pratt & Whitney’s 22% stake in Volvo Aero Norge and hence becomes tract, which covers two APS3200 from GECAS. sole owner of the company. Volvo Aero previously acquired the 12% stake owned by Snecma, Services will be carried out at Turkish Technic’s following the purchase of approximately 66% of the total shares in what was then Norsk APU shop in Istanbul, Turkey. Jetmotor AS in Kongsberg back in 1999. AviTrader MRO - April 2011 News in brief 23 popular family of regional aircraft have clocked up a considerable number of flying hours, their lessor NeWs iN brief APUs are becoming due for overhaul. airberlin and GECAS agree to package deal for 12 aircraft SuperJet International obtains Design GE Capital Aviation Services and airberlin announced an agreement for the financing of 12 Organization Approval certificate new aircraft - covering five Airbus A320, three Airbus A321 and four Boeing 737-800, all SuperJet International (SJI) received the DOA equipped with CFM engines. This sale-and-lease-back transaction is covering deliveries due in (Design Organization Approval) Certificate from the first three quarters of 2012. The total deal size is approximately $ 1 billion in list prices. the European Aviation Safety Agency (EASA), which allows to carry out modifications to the Air Lease Corporation commences initial public offering of Class A base configuration of the Sukhoi Superjet 100 Common Stock (SSJ100). SJI is now entitled to provide custom- Air Lease Corporation announced the launch of its initial public offering of 25,000,000 ers with any type of interiors customization in shares of Class A Common Stock. All shares included in the initial public offering are being order to satisfy the specific airlines’ needs. All sold by the Company. The estimated initial public offering price is between $25.00 and the variants made to the aircraft and its parts $28.00 per share. will be agreed with the manufacturer Sukhoi Civil Aircraft Company. bal team to deliver maintenance engineering, ExecuJet Dubai receives Embraer exten- Boeing expands GoldCare Service to planning and execution and material services sion to base maintenance approval include Next-Generation 737 with a predictable cost based on airplane flight hours. Simplified maintenance operations and ExecuJet Middle East announced that their Em- Boeing is expanding its GoldCare service to logistics allow GoldCare customers to focus on braer Legacy Authorised Service Centre agree- include the Next-Generation 737 product their passengers while their airplanes are main- ment has been extended for their base mainte- line. The company is in advanced discussions tained to the highest standards of excellence nance capability in Dubai. This now covers up-to with multiple customers regarding the tailor- by Boeing, supported by GoldCare partners. and including a 24 month (L4) inspection on the ing of GoldCare solutions for their 737 fleets. Boeing provides GoldCare customers with 24/7 Legacy 600 and 650. ExecuJet is now the only GoldCare is available to 787 Dreamliner op- operations support using the latest technology Embraer Legacy Approved Maintenance Centre erators and Boeing is expanding the service in to turn airplane operating data into diagnostic to carry out base maintenance in the Middle response to airline customer demand. Under information that enhances efficiency and maxi- East region. In December last year Embraer an- GoldCare, Boeing leads and integrates a glo- mizes airplane availability. nounced that they had appointed ExecuJet as Inventory Management* Invoice Management* Integrated Accounting The StockMarket The cornerstone for the Provides the opportunity The Accounting Module Quantum users can Quantum Control system. The to manage the invoice process includes General Ledger, search, buy, and sell parts with parts summary screen provides by viewing system wide for Accounts Receivable, Accounts other users in real time a central viewpoint for all information and activity open sales orders and determining if these can be MRO Business Software Integrated with Payable, and more - all totally integrated with Sales, without leaving the software. Inventory postings are related to a given part. expedited or consolidated with Purchasing, Repair, Exchange, automatic and can include existing invoices, etc. Aircraft Services Manufacturing MRO Shop Control Work Order and Invoicing details such as serial numbers, Contact Management Shipping Management Contains features such as The Manufacturing Module Manages the complete modules. images, time life and prices. Manages the shipping and the ability to record and track addresses all aspects of Component and Assembly Fixed Asset Storefront Quantum tool integrated with Quantum's order consolidation process to Routine and Non-routine the manufacturing process Repair and Overhaul process. Allows customers to login entire suite of modules. maintenance. Integrated with Includes real-time Cost and master parts for depreciation to your website to search, Enhances your ability to track and statuses. Creates custom Inventory, Purchasing, control, inspections, materials Schedule Management and tracking, and to modify view, RFQ or purchase from critical activity such as Sales, invoices, packing slips and Quoting, Billing, Labor planning, purchasing and functions that put you in transactions such as how the your existing stock in real- A/R, Repair Management and recording and Publications outside servicing. complete control of your asset is sold, issued to a job or time. Information such as time Customer Service calls. shipment. tracking. Bar Code module is shop’s activity. scrapped. Transactions allowed & cycles, tag info, scanned Purchase Orders integrated as well for Labor Document Imaging include purchasing, stock re - documents and images can be Repair Manual Tracking Vendor Quotes* & Requests* and Task Card updates. Provides for scanning of ceiving, invoicing, scrapping attached to the Stock item to Tracks all publications and Provides a tool to locate Manages the purchasing pro - documents or images directly revision dates and review dates. and issuing, turn-ins, outside assist your customer in their Hangar Management into the Quantum application. repair, internal work orders and purchasing decision. You can sources for part procurement cess including request routing Allows for complete Scanned Images or external changing acquisition value. also include and advertise your and send out requests for and approval by dollar amount by part, customer and ATA. resource management across overhaul, manufacturing, and quotes to multiple vendors, and employee position. Man - Integrated with the Shop Time and Attendance your aircraft service center all the critical data elements in distribution capabilities di- including multiple lines. ages purchasing activity for Control module providing Accurately manages the with the ability to quickly Quantum. Various formats are rectly to your customers. stock, non-stock and ex- collection and tracking of em- assign tasks, view workers supported including PDF. Quotation Processing* change. for individual work orders. ployee's work time. Shift pat- Quantum Portal productivity, and manage Quantum A field Also field Enables the presentation Yep Manages the customer Receiving & Inspection* unassigned work in real-time Event Manager Lot Costing of Quantum functionality to quotation process and the The receiving module is a through an intuitive interface. Allows for automated overtime, grace periods, and to Tracks acquisition costs, users via a standard web recording of supplier responses reporting, e-mailing and faxing identify exceptions requiring CAMP Integration teardown expenses, overhaul browser. Out of the box, from outgoing RFQs. cost-saving receiving, interme- to customers, suppliers and management attention. Vaca - Allows Quantum Control and repair expenses as well as contains functional modules internal users. E-mail tion & holiday time is also users to increase regulatory miscellaneous charges. Single for your customers to check gether with defect recording. tracked and a payroll interface Sales Orders* screen visibility of lot related compliance by providing rea-l created using pre-packaged extract is included. status and shipping Manages the customer Bar Coding activity including receiving, time access to maintenance scripts or custom designed information for Sales Orders order process to include back Prints bar codes and sales, repairs and scrap QuickBooks and Work Orders. order management, invoice allows for the scanning of functions. Accounting Bridge vice bulletins and airworthi- Links Quantum to QuickBooks Rental and Leasing preparation and product physical inventory to track and Business Intelligence - ness directives through the BUSINESS INTELLIGENCE Pro. Sends QuickBooks the The Rental and Leasing returns. manage stock and account for Max-Q from Oracle web-based CAMP Maintenance data required for G/L Account module has the versatility to all parts when shipping, With Max-Q you get Avia - Take advantage of the power of Management system. Balances, Financial State- handle all of your rental and Sales Exchange* receiving, etc. tion's leading Business Appli- Oracles' Business Intelligence This powerful module pro - Repair Orders* Avtrak Integration cation, Quantum Control, im - (BI) application. The Oracle BI ments, and much more. leasing transactions including vides complete functionality Manages the preparation, Provides communication plemented with the latest da - foundation and toolset in- EDI Integration with unparalleled versatility to pulling from inventory, ship- between Quantum and the tabase technology from Oracle cludes an integrated array of Through its Electronic AVREF Catalog Files handle your most complex e- x ping and receiving of compo - Avtrak GlobalNet maintenance to provide the ultimate in da- query, reporting, analysis, Data Interchange (EDI) The AVREF Catalog System change processes. Supports nents sent out for repair. The tabase Security, Reliability, alerting, analytics and desktop module, Quantum users can provides the latest OEM pricing brokered exchanges, work Repair Order module provides the Quantum work order Scalability and Performance. integration. Quantum's inte - now conduct paperless tran-s information along with access order exchanges, routine ex - historic as well as current module, drastically reducing gration to this end-to-end en- actions with their business to Government MCRL cross re -f changes, repair order conve- r repair cost per component, de - the possibility of data entry terprise performance manag-e partners. EDI transactions erence data. Completely inte - sions to exchange and core tailed by parts, labor and mis- ment system unlocks the intel - range from quote to purchase grated with the Quantum In- tracking. cellaneous charges. cy in the maintenance system. ligence of your business. to invoice, and more. ventory Module. *Standard Quantum Module Ask About Our Referral Program News in brief 24 the new Authorised Service Centre in the Mid- dle East for scheduled and unscheduled mainte- fiNANciAl NeWs iN brief nance. ExecuJet Middle East holds EASA, GCAA Aviation Capital Group closes $750,000,000 Senior Notes Offering and further NAA AMO approvals for the Legacy aircraft type. Aviation Capital Group (ACG) closed the sale of $750 million of its 6.750% senior notes due April 6, 2021. Proceeds from the offering will be used for general corporate purposes. In Airbus VIP Interior certified by BaySys 2010, ACG issued $600 million of Rule 144A senior notes and $255 million of privately placed unsecured notes. Including the sale of the notes announced today, ACG has raised a total of BaySys International reported the final certifi- approximately $3.64 billion in debt financing since the beginning of 2008. cation and entry into service of Virginia’s first A340 completion. The aircraft received both ILFC enters into $1 .3 billion committed secured loan FAA and GACA STC certification for the inte- rior and upgrades which were accomplished at International Lease Finance Corporation (ILFC) announced the commitment for $1.3 billion the NASA Wallops Flight Facility located on the of a secured term loan with a group of 15 banks from Europe, Asia and North America. The eastern shore of Virignia. BaySys had as many company also has the right to upsize the transaction by $200 million in commitments from as 285 employees working the program during additional lenders. all evolutions. BaySys is currently completing a Boeing B777 program at their facility. AVIO reports revenue growth of 3% for 2010 AVIO reported consolidated revenues of €1,753 million, a growth of 3% at current exchange BAE Systems wins FOKKER 100 rates. Adjusted EBITDA rose to €339.1 million, increasing by 9.1% against the €EUR 310.6 mil- remarketing mandate lion in 2009, corresponding to 19.3% of revenues (18.3% in 2009). The order book reached BAE Systems was selected by AviancaTaca – €6 billion, with an increase of about 1% against 31 December 2009. Net debt decreased to one of Latin America’s largest airline groupings €1,480.8 million from €1,543.6 million at 31 December 2009. - to exclusively remarket Fokker 100 jet airlin- ers for sale. The Fokker 100s, built between Willis Lease Finance reports 4th quarter net income of $4 .0 million 1992 and 1994, will be released on a planned Willis Lease Finance Corporation reported improving utilization and strengthening demand and gradual basis for remarketing from now for leased engines boosted fourth quarter profits. Net income increased to $4.0 million in the through to June 2012. fourth quarter of 2010, compared to $3.1 million in the third quarter and $1.0 million in the fourth quarter a year ago. The lease portfolio increased 2% year-over-year to $998.0 million, SR Technics services 15th easyJet A319 with 16 engines purchased and 7 engines and one airframe sold during 2010. aircraft in Malta SR Technics welcomed the 15th easyJet air- Lufthansa Technik increases 2010 revenues, but reports lower result craft to its new two-bay facility in Malta. Af- Lufthansa Technik Group reported a 1.4% increase in revenues in 2010, but as expected, the ter a 14-day standard IL-maintenance check, company’s EBT declined by 4.2% to €282 million. Revenue from other companies in the Lufthan- the aircraft was be re-delivered at the end of sa Group declined by 1.3% attributed to lower numbers in ground maintenance events and March. Since October 2010, the company has prices that were reduced for competitive reasons, but revenue from business with customers built up its operation in Malta as a center of outside the Group grew by 3.3% to €2.4 billion, and as a result, its share in total revenue climbed excellence for narrowbody aircraft base main- slightly to 59%. The operating margin was 7.0% in 2010. tenance in Europe. easyJet is SR Technics’ base load customer in Malta with a long-term Israel Aerospace Industries’ financial figures for 2010 maintenance contract. As part of the agree- ment, SR Technics has been performing three Israel Aerospace Industries reported that sales for the fourth quarter of 2010 reached $849 mil- IL-maintenance checks per month on easyJet’s lion, up 12% over the same period in 2009. Export sales rose 15% to $671 million. Sales to the Airbus A319 aircraft. defense market in the fourth quarter of 2010 reached approximately $628 million, an increase of 10%, while sales to the commercial market rose 18% to $221 million. Net profit for the fourth Iberia converts passenger aircraft into quarter totaled $14 million, up 68% from 2009‘s $8 million. mid-air refuelling tanker BOC Aviation achieves record net profit for the fifth consecutive year Iberia converted an Airbus A330-200 passen- ger airliner into a Multi Role Tanker Transport BOC Aviation’s net profit after tax for the financial year ended 31 December 2010 reached S$168 (MRTT), equipped for mid-air refuelling. It was million, 22% higher than the previous record of $137 million achieved a year ago. Total assets the first time such a complex task has been as at 31 December 2010 were $6.6 billion, up by 14% compared to the prior year while share- performed in Spain, where Iberia maintenance holders’ equity rose 39% to $1.3 billion. During 2010, BOC Aviation took delivery of 32 aircraft and engineering teams completed it in a record which when combined with an effective funding strategy and strong financial discipline, resulted 16 months. After the final flight test on March in higher operating profit. 15th, the aircraft belonging to the Saudi Ara- bian air force, was delivered by Iberia to Air- AeroCentury reports fourth quarter 2010 net loss of $1 million bus Military. Iberia’s engineers and technicians AeroCentury posted fourth quarter total revenues, to December 31, 2010, of $5.9 million com- spent 140,000 man-hours on the conversion of pared with total revenues of $8.6 million for the same period a year ago. For full-year 2010, the the A330, during which they modified 5,500 company reported total revenues of $30.7 million compared with revenues of $33.6 million for system components, making structural changes 2009. The company reported a net loss of $1.0 million for the fourth quarter of 2010, compared to 2,000 parts. An additional 58.5 km. of wir- to net income of $1.9 million for the fourth quarter of 2009 and net income of $1.6 million for ing was installed, including 1,000 metres each full year 2010, compared to net income of $5.7 million for 2009. of coaxial cable and fibre optic cable. AviTrader MRO - April 2011 industry people on the move 25 CIRCOR Aerospace named Dave Elston to pore office and will report to Harry Forsythe, and quality assurance, Bianchi will oversee the business development team as Aftermar- executive vice president, marketing. Mr. Lam the growing airline’s technical operations. ket and MRO Business Development director. will have responsibility for deal origination in Dave’s role will focus on the growth of the Australia, New Zealand, SW Pacific, China, Constant Aviation, an MRO facility headquar- CIRCOR Aerospace landing gear MRO market Mongolia, Hongkong, Macau, Taiwan, South tered at Cleveland Hopkins International Air- segment, after the recent acquisition of its Korea and Japan. port, promoted Derek Morris to avionics modi- Sylmar, CA landing gear business. fications manager. Derek will be responsible for Aircell announced the appointment of Shau- overseeing all avionics modification projects. Guangzhou Aircraft Maintenance & Engi- na R . Haras as sales director. Haras will be neering Company (GAMECO) reported that responsible for expanding and increasing Air- Boeing named Marc Allen president of Boe- Norbert Marx has been named as the new cell’s advertising and sponsorship revenues in ing China. Allen will be based in Beijing and General Manager of GAMECO. Marx has more partnership with Fortune 500 companies. report to Shep Hill, president, Boeing Inter- than twenty years leadership experience in the national and senior vice president Business global aviation markets with extensive exper- TIMCO Aviation Services reported a transi- Development and Strategy. In his new role, tise in maintenance, repair and overhaul. Marx tion in leadership effective 1 April. Kevin Allen will be responsible for Boeing’s growth most recently was vice president, Airframe Carter assumed full responsibilities as chief and productivity plans and initiatives in Chi- and Vice President Boundary Bay at Heli-One executive officer, in a capacity he has shared na. He succeeds David Wang, 67, who is re- Inc./CHC, in Vancouver, Canada. In addition with Ron Utecht over the past two and a tiring after almost a decade of service in one Wu RongXin was named as the new deputy half years. Utecht will transition from his for- of the company’s key global markets. general manager of GAMECO. Wu joined the mal leadership role into a senior advisory role PremiAir appointed Mike Preston as director GAMECO staff in 2008 serving as the chief fi- with the company. In addition, Bill Norman of Engineering & Maintenance. The appoint- nancial officer for the last three years. joined TIMCO as the company’s new presi- ment is effective immediately, with Preston dent of MRO Services, leading the company’s taking responsibility for fixed-wing and rotary International Lease Finance Corporation re- airframe and engine MRO operations as well maintenance at the Group’s Oxford, Biggin Hill ported the promotions of Fred Cromer to as its TIMCO LineCare business. Rick Salani- and Blackbushe facilities. president and Philip Scruggs to executive tri will continue to lead TIMCO Aerosys- vice president. The company also announced tems as its president and Elizabeth Taylor CIRCOR Aerospace Products Group appoint- that Alan Lund, who has served as vice chair- will continue to manage TIMCO human re- ed Pritesh Patel as the director of informa- man and president, has retired as president sources and legal functions as executive vice tion technology. Patel will report to CIRCOR but will remain as vice chairman and member president and general counsel. Lee Fox will Aerospace Group vice president Christopher of the company’s board of directors. continue in his role as treasurer, and will also Celtruda. be assuming new responsibilities as TIMCO’s Francesco Caio will become Avio’s chief ex- chief financial officer. Nexcelle, a joint venture of GE’s Middle River ecutive officer with effect from 2 May 2011. In Aircraft Systems (MRAS) and Aircelle of the his new role as chief executive, Caio will take BOC Aviation reported that Steven Townend, Safran group, confirmed the appointment over from Alan Bowkett, chairman of Avio deputy managing director and chief commer- of Jan Beseler and Jean-Christophe Dalla Group, who has been leading the company cial officer, was elected to the board of direc- Toffola as the company’s two executive vice since the sudden death of the company’s CEO tors of the International Society of Transport presidents - incorporating two highly experi- Orazio Ragni, in October 2010. Bowkett will Aircraft Trading (ISTAT) for a four-year term. enced managers from its parent companies in remain as the group’s non-executive chairman. the organizational lineup. Beseler is from GE The Board of Directors of Avio appointed Caio Virgin America appointed Mark Bianchi as Aviation, and brings extensive expertise in jet to the Board of the company. the airline’s senior vice president of Technical engine nacelle integration and engineering. Operations. An industry veteran with more Dalla Toffola comes from the Safran group’s Macquarie AirFinance appointed Vincent than 27 years of hands on experience in air Aircelle business unit, where his responsibilities Lam as vice president of marketing, Asia Pa- carrier operations, line and base maintenance, included nacelles, international partnerships cific. He will be based in the company’s Singa- fleet management, regulatory compliance and the supply chain.
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