SEPANG: Malaysia Airlines Bhd’s maintenance, repair and overhaul (MRO) unit is confident of becoming the third largest revenue contributor for its parent company, Malaysia Aviation Group by 2025.
Malaysia Airlines chief operating officer Ahmad Luqman Mohd Azmi said the MRO business was expected to increase tenfold to RM30 million by end of 2020, from the current contribution of RM3 million.
“We have just started on this new third-party MRO business in the third-quarter (Q3) this year and it has been encouraging to have secured and performed work for major airlines in Malaysia, Singapore and Sri Lanka.
“Beyond operators, we have been offering re-delivery services to lessor as well. There are more opportunities which we are currently working on and aim to secure more operators and lessors in Asia Pacific (APAC) region,” Ahmad Luqman told the New Straits Times in an interview recently.
He said the third-party contracts secured were mainly from airlines and lessors to provide MRO services for the fleets of A380, A330, B737-800/900 and B777.
Currently the MRO works involve multiple airframe checks, parts or components replacement and maintenance, interior cabin, sheet metal and composite repairs with some extensive work on non-destructive testing (NDT) support.
Ahmad Luqman said airlines or lessors in the region preferred to send their aircraft within APAC as it means better turnaround time and competitive rate for the MRO services.
“We have the capability and facility to do MRO services at our two main hangars at the Kuala Lumpur International Airport (KLIA).
“Both hangars have six lines (aircraft parking). However, there are plans to expand the hangar capacity by extending more lines as we anticipate more demand,” he added.
Ahmad Luqman said the expansion work was expected to be completed in 2020.
“This is necessary so that we are able to use the existing facility and be more efficient and increase productivity. We were initially planning to reinvigorate this third-party MRO business in late 2017, when the current Malaysia Airlines chief executive officer Captain Izham Ismail came onboard,” he said.
Ahmad Luqman said the third-party MRO services was one of the key potentials for Malaysia Airlines to resuscitate the business since exiting it in 2016.
“We believe this business has good potential as we have the capability not only to handle Malaysia Airlines aircraft but also beyond our fleet,” he said.
Ahmad Luqman said MAB’s new MRO scope of businesses will comprise airframe checks, end-of-lease, part-out and painting job for aircraft livery.
Malaysia currently employs over 2,000 local staff comprising engineers and technicians for its MRO facility, servicing 70 per cent of its own aircraft fleet (83 units) and 30 per cent for third party.
Ahmad Luqman said the MRO unit was aimed at providing the best quality services with competitive pricing, thus reducing the turnaround time of the aircraft.
“We need to do well in delivering our MRO services as we aspire to be one of the best players in the Asia Pacific region. MRO services is high in demand but highly competitive.
“We believe the MRO business can be sustainable for us to remain on track as 13,000 new aircraft orders are expected to be delivered until 2037 in the region.
“We aim to meet the projected high growth demand for aircraft maintenance in the region for both in service and end-of-lease business. This provides us an opportunity for MRO requirements, which in turn will help us to be one of the key pillars to turnaround Malaysia Airlines,” he said.
The airline’s MRO utilises the aircraft maintenance operating system (AMOS) that measures end-to-end process including tracking the inventory system, allocating manpower for a specific task and controlling work scope.
He said the system ensures the overall work is being taken within the specific timeframe to drive efficiency and productivity, thus reducing the turnaround time of the aircraft.
Ahmad Luqman said the return of the MRO third-party services reflected its commitment to support the industry, in line with the government’s Aerospace Blueprint 2030 vision.
“We also welcome to collaborate with other MRO players to support our growth in the region, while nurturing local talents. This is supported by our engineering school. We train about 100 engineering students annually to ensure a steady talent pipeline for years to come to sustain the business,” he said.
Currently, Malaysia Airlines’ MRO facility is certified by the Civil Aviation Authority of Malaysia and multiples foreign Civil Aviation Authority such as Singapore, Sri Lanka, European Union and United States.