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Right Sourcing to Influence the MRO Market of the Future 

At MRO Americas 2015 today, Kevin Michaels discussed the current trends in “right sourcing.”
Michaels explained that over the past decade, significant manufacturing and design infrastructure has been established in China, Russia, India and Brazil. Within China and India, there were particularly high levels of engineering investment from 2008-2011. A significant factor included the low cost of labor in the locations.
The commercial aviation corporation of China COMAC attracted a lot of western aerospace investment in China in the 2004-2011 period.  
But over the past three years, there has been a shift.  China has experienced significant increases in labor costs, as well as skilled labor shortages.  Automation has continued to erode labor content for many aerospace parts.  Higher oil prices made transportation costs a significant factor in offshoring during 2012-2014.  Factors like these have resulted in more “right shoring” – in which value chain activities are sited in the best locations for long term competitive advantage and market access.  Labor costs are no longer the only factor in locating business units.
This means at in the most recent years, aerospace investment dollars are returning to the US.  The Southeast US has become a hot spot for the balance between labor costs, skilled labor availability, transportation costs, etc.  
China seems to have a customs ‘firewall’ tat can make it much easier to bring product into China of it is assembled in China.  To serve Asia effectively, many companies are getting into China because of the difficulty in bringing product into China.  
What does this mean for MRO?  More heavy checks that were going to Asia are coming back to North America as the asian labor rates increase.  Lufthansa Technik will open a heavy maintenance Facility in Puerto Rico (other companies with significant engineering centers in Puerto Rico, include Lockheed Martin, and Pratt and Whitney). Other new heavy maintenance facilities are being opened in the continental US, including facilities for companies like ST Aero (by the way, Michaels predicted that the US would not be the hot spot for aerospace investment in four years, as industry trends continue to evolve).
But other maintenance still needs to follow the customer growth patterns.  Michaels concluded that growth will still be led by Asia, China, and the Middle East (China will continue to be a separate market from the rest of Asia).  So there is still a need for the MRO community to invest in those regions in order to support those customers.  

Hotel Rooms At The W Istanbul Are Running Out! Book Now For The 2015 AEA/MARPA PMA Parts Conference

The 2015 AEA/MARPA PMA Parts Conference will be held in a just a little over month, on May 25-26, 2015 at the W Istanbul Hotel.  But the deadline for making hotel reservations at the discounted rate is Monday, April 13!

We have negotiated a room rate of Single – 225,00 €/Double – 245,00 € with the W Istanbul, excluding taxes.  Room rates include an open buffet breakfast and can be cancelled prior to 4:00pm on May 23, 2015 without forfeiture.

This rate applies on a limited basis for rooms up to two days before and after the event, for those who wish to extend their stay. This is the lowest rate available to any group at the Conference Hotel during this time period!  In order to qualify for this special rate, you must book your room by Monday, April 13, 2012.  Click here for the direct booking link.

We hope to see you at the event!  Click here for more information about the 2015 AEA/MARPA PMA Parts Conference.

2015 AEA/MARPA PMA Parts Conference Early Bird Registration Discounts Are Running Out!

If you haven’t already registered for the 2015 AEA/MARPA PMA Parts Conference, now is your chance to submit your registration at the discounted Early Bird rate!

The 2015 AEA/MARPA PMA Aircraft Parts Conference will provide an excellent opportunity for air carriers to learn about strategies for saving money on maintenance costs AND improving reliability and safety. PMA manufacturers have the opportunity to meet members of the European, Middle Eastern, and Asian aviation industries, and to learn more about exporting their parts to carriers from around the globe. There will be networking opportunities for manufacturers to introduce air carriers to ideas that can generate cost savings and reliability improvements for their operations!

Why should you register?

  • Networking and education opportunities
  • Airlines worldwide have already begun taking advantage of PMA parts on their own aircraft in order to achieve benefits like reliability, safety, availability and savings (and other operators could be enjoying these same benefits!)
  • The global leasing community, should look to FAA-PMA as a way to protect the value of their assets
  • For operators and leasing companies, FAA-PMA parts are part of the solution-oriented approach to safety, reflecting opportunities to achieve benefits like reliability, safety, availability and savings
  • For maintenance facilities, FAA-PMA parts can be a competitive advantage when bidding maintenance jobs
  • For manufacturers, the FAA-PMA community reflects opportunities for manufacturing partnerships

Register on our website or submit a registration form to MARPA today and lock in your savings.  Your customers and contacts will be there – you should be there, too!

Delta Airlines’ Mike Rennick To Offer PMA Reliability Data at the 2015 AEA/MARPA PMA Aircraft Parts Conference

MARPA is pleased to announce that the MARPA Air Carrier Committee Chairman, Michael Rennick, Manager of Component Engineering at Delta Air Lines, will be speaking at the 2015 AEA/MARPA PMA Aircraft Parts Conference.  Mr. Rennick will offer an operator’s perspective on PMA parts, and will provide PMA reliability data from within his organization.

The 2015 AEA/MARPA PMA Aircraft Parts Conference conference will be held May 25-26, 2015, in Istanbul, Turkey at the W Istanbul Hotel.  For more information or to register, please visit our website.  We hope to see you at the event!

New Airline Credit Ratings Issued – Now Come Meet the CEO!

Looking for good business partners? Look no further than the AEA/MARPA Conference in Istanbul on May 25-26, 2015.

Our keynote speaker will be Dr. Temil Kotil, the CEO of Turkish Airlines, who will discuss how his airline has used PMAs as part of their safety strategy.  This is an excellent opportunity for PMA manufacturers to meet Dr. Kotil in an intimate atmosphere that is designed to foster networking and discussions of solutions like PMA.

A recent article in Turkish Weekly announced that Turkish Airlines has been awarded corporate family ratings of Ba1 (from Moody’s) and BB+ (from S&P).  By way of comparison, American Airlines was recently upgraded by Moody’s to a positive outlook, and at that time Moody’s confirmed a B1 rating for the corporate family.  Last fall, S&P upgraded Southwest Airlines from BBB- to BBB.  This shows that Turkish Airlines is situated well within the range of the finest airlines.

Rehan Akbar is Moody’s lead analyst for Turkish Airlines.  Akbar explained that “Our decision to assign a Ba1 CFR to Turkish Airlines balances the company’s healthy financial profile and role as the national carrier against the execution risks associated with its high-growth strategy.”  The Moody’s press release explained that “Turkish Airlines’ healthy financial profile is underpinned by its low-cost structure and historical above-peer-average profitability metrics. The airline has a well-diversified passenger revenue base that is supported by the economic and tourism growth seen in Turkey, while Istanbul’s geographic location allows the Ataturk International Airport to act as a hub for international transfer traffic. ”

What does this mean for PMA companies?   It means that Turkish Airlines is a serious airline that is recognized internationally for its profitability.  And part of what makes an airline like this successful are good business practices that ensure safety while providing good value that can be passed on to the traveling public.  PMAs are one of the solutions that the leading airlines are using to ensure that they remain safe and profitable.

This meeting is co-hosted by the Association of European Airlines (AEA), and they have confirmed that they expect significant airline attendance; so make sure your sales force attends!

I look forward to seeing all of MARPA’s members (and a few non-members) at the Istanbul meeting in May!

Please Note Our New Conference Dates for the AEA/MARPA PMA Aircraft Parts Conference!

Due to an unforeseen conflict we have revised the dates of the AEA/MARPA PMA Aircraft Parts Conference.  The new dates are May 25-26, 2015, at the W Istanbul in Istanbul, Turkey.

AEA has confirmed that representatives from all major European air carriers will be in attendance. MARPA has also been in touch with Middle Eastern and Asian air carriers.  Please spread the word about this meeting among your friends in the PMA community to help us to make sure the AEA/MARPA PMA Aircraft Parts Conference  is a huge success!

For more information, visit our website here: www.pmaparts.org/EMEAconference

If you have any questions about dates, venues, or speakers, please feel free to contact MARPA today.

We look forward to seeing everyone in Istanbul!

CEO of Turkish Airlines Dr. Temel Kotil to Keynote AEA/MARPA PMA Parts Conference in Istanbul

MARPA is extremely pleased to announce that Dr. Temel Kotil, President and CEO of Turkish Airlines, and President of the Association of European Airlines, will serve as the Keynote speaker for our first-ever AEA/MARPA PMA Aircraft Parts Conference.

Dr. Kotil began his career at Turkish Airlines in 2003, serving as the Deputy General Manager of Turkish Technic. He became the CEO of Turkish Airlines in 2005. Dr. Kotil has served on the Board of Governors of IATA since 2006 and on the Board of Directors of AEA since 2010.  Dr. Kotil became president of AEA on January 1, 2014.

Turkish Airlines is the national flag carrier of Turkey and the largest air carrier in the country. As of February 2015, the Turkish Airlines fleet consists of 253 passenger and 9 cargo aircraft.  Turkish Airlines offers scheduled service to over 260 destinations in Europe, Asia, Africa, and the Americas.  It’s cargo operation serves 47 destinations.

MARPA wishes to extend its sincere thanks to our partner AEA for their efforts in securing Dr. Kotil as keynote speaker for the conference, as well as their ongoing support in organizing the AEA/MARPA PMA Aircraft Parts Conference and ensuring the attendance of their members.  The participation of AEA’s member airlines provides an excellent opportunity for our members to meet and network with customers. It is also an opportunity to continue the ongoing discussion about the benefits and value of PMA parts.  MARPA looks forward to seeing our members in Istanbul networking with the air carriers of not only Europe but also the Middle East.

PLEASE NOTE OUR NEW CONFERENCE DATES!  Due to an unforeseen conflict we have revised the dates of the AEA/MARPA PMA Aircraft Parts Conference.  The new dates are May 25-26, 2015, in Istanbul, Turkey.  If you have any questions about dates, venues, or speakers, please feel free to contact MARPA by emailing Program Manager Katt Brigham at katt@washingtonaviation.com.

We look forward to seeing everyone in Istanbul!

Register Now to Receive Discounts for the 2015 AEA/MARPA PMA Aircraft Parts Conference

UPDATE: Due to an unforeseen conflict the dates of the AEA/MARPA PMA Aircraft Parts Conference have CHANGED!  The new dates are May 25-26, 2015 in Istanbul, Turkey.  Please visit the conference website for latest hotel and registration information.

The early registration deadline for the 2015 AEA/MARPA PMA Aircraft Parts Conference  is fast approaching.  In order to qualify for the earliest registration discount, registrants must register by January 31, 2015. For the first time, AEA and MARPA will host a conference to bring together experts and leaders, manufacturers and customers within the PMA industry in a location designed to facilitate business between USA FAA-PMA manufacturers and the international air carrier community. The 2015 AEA/MARPA PMA Aircraft Parts Conference will be held in Istanbul, Turkey on May 18-19, 2015, in cooperation between the Modification And Replacement Parts Association (MARPA) and the Association of European Airlines (AEA). You can find more information about the event and registration online at http://www.pmaparts.org/EMEAconference

The Argentine Market

This week, MARPA is at the MRO Latin America show to promote PMA. The meeting is being held in Buenos Aires, Argentina.

Aerolineas is the flag carrier of Argentina. The carrier was formed in 1950 from the merger of four other air carriers. Today they have 69 aircraft. They expect to reach 73 soon with an expected delivery of four new A330s.

Forecasts continue to show Latin America as a leading growth area for aviation MRO. Latin America is expected to grow from 2226 aircraft to 4911 aircraft (commercial passenger and cargo) from 2010 to 2030, according to ICAO. This will reflect a growth from 10% of the global totals to 12% of the global totals.

Argentina has 119 Argentine MROs and another 52 foreign MROs certificated by Arentine Civil Aviation National Administration. 74 of the domestic MROs are in Buenos Aires and 6 of them focus on commercial aviation with the other 68 focused on General Aviation.

Aerolineas has a significant labor force focused on MRO. They have 1600 maintenance personnel working for the air carrier and their sister airline, Austral, has 520 maintenance personnel.

Aerolineas wants to generate partnerships with other air carriers, MROs and training organizations. They are building a new hanger in Buenos Aires and plan to expand their capabilities to support their fleet. The new hangar will have enough space to house an A380.

Aerolineos has been working to focus their fleet. Older types have been retired in favor of a more narrow fleet. The new fleet is focused on just four major types: A340-200/300, A330-200/300, B 737-700/800, and E190. They are retaining capabilities for other types, though, because they perform MRO services for other operators, including Tame, BahamasAir, and the Argentine President.

Fleet standardization means that there is less time spent on training for the maintenance personnel, which helps to Ake their team more efficient.

Today, the Aerolineas MRO is certified by ANAC, FAA and the Argentine military. As such, they seem like a prime target for PMA!

MARPA Winter Meeting Update

Don’t forget that the 2015 MARPA Winter Meeting will be held February 9, 2015.  This is our annual “open Board meeting,” to which MARPA members are invited in order to participate in MARPA strategic planning.

EVENT: MARPA Winter Meeting
DATE: February 9, 2015
TIME: 9:30 AM – 4:30 PM
PLACE: 2233 Wisconsin Avenue, NW
COST: Free for MARPA Members
WHAT IS IT: The MARPA Winter Meeting is a strategic planning meeting attended by the Board and other members. We also typically meet with government officials from the FAA and other agencies.
WHO: Any MARPA member is welcome to attend. Please RSVP to Katt Brigham at (202) 628-6777 OR by using the response form, below. We have limited space, so please RSVP by January 26th so we can make appropriate plans for attendance.

RSVP Response Form

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