MRO warfare in the NextGen widebodies battlefield

To date, Airbus has secured orders for more than 3 500 new wide-body aircraft. Meanwhile, the world’s latest generation wide-body, Airbus A350XWB, has been recently delivered for Qatar Airways, after an 11-day demonstration tour around Asia, and successfully finished its flight from Frankfurt to Doha. On the one hand, powered by Roll-Royce Trent engines, A350XWB promises the industry a further increase in cost effectiveness. On the other hand, the NextGen widebodies will definitely require suitable MROsolutions as well. In addition, the early indications suggest that the demand for new wide-body aircraft will result in substantial investments and rising labour costs to support the new comprehensive aircraft MRO systems. With this in mind, what are the challenges for MRO’s in the upcoming future?

Understandably, many experts report that the MRO development for NextGen widebodies will result in a fierce competition, requiring expert knowledge, geographical expansion and, as a consequence, demanding more investment not only for OEMs, but for independent providers as well.

Asia vs. North America

To begin with, there are predictions that some of the US air carriers will stop using maintenance services overseas and shift back to USA‘s MRO. Due to increasing cost, more and more operators realise that outsourcing is not as efficient as it was before. Growing maintenance costs also alert about the change in the scope of heavy maintenance outsourcing, thereby increasing the pressure on local providers. For example, according to AAR, these trends served as a reason for it to open a $15+ million MRO facility in Illinois, designed specifically to accommodate newer wide-body types.

“When we looked at the global market and zeroed in on the U.S. market, we saw a need for maintenance hangars that are capable of managing these new generation aircraft” - says David Storch, CEO of AAR.

One way to keep up with the growing competition is to provide tailored MRO solutions, as done by Boeing. The company’s strategy is to tie its manufacturing and maintenance businesses. Thus, apart from delivering orders, Boeing provides essential support for Malaysia Airlines (100 737 aircraft), BOC Aviation (50 737 MAX 8s, 30 Next-Generation 737-800s and two 777-300ERs) and Emirates (150 777Xs).

In the meantime, the changing situation may create new possibilities for MROs in Asia, which are not expected to give up without a battle and try to retain their place under the sun, even though it will not be a simple task. The capital cost of such an expansion is indeed challenging.

As stated by Mr William Kircher, Vice President at Pratt & Whitney Singapore Overhaul & Repair, Pratt & Whitney is continually investing in global partnership network to offer customers choice and flexibility. Doing business across the globe allows Pratt & Whitney to remain competitive with the right work in the right places, yet remain in close proximity to many customers.

„Established for more than 30 years, our footprint in Asia Pacific has also grown to allow us to remain well-positioned to benefit from future growth in this market. Singapore is home to Pratt & Whitney's most comprehensive aftermarket presence in a single location. Complementing our existing MRO capabilities in Singapore, Pratt & Whitney Eagle Services Asia is currently our global center of excellence for PW4000 large commercial engine overhauls, and will be one of the five Pratt & Whitney engine overhaul centers for the PurePower® engine family when it enters into service beginning this year”- shares Mr William Kircher, Vice President at Pratt & Whitney Singapore Overhaul & Repair, President at UTC Aerospace Singapore.

According to MTU Maintenance, the company is also continuously investing in new and state-of-the-art machinery, as well as further capabilities in China. As such, MTU Maintenance Zhuhai is permanently working on extending its capabilities and improving its service level, and only recently has introduced MRO capabilities for the CFM56-7BE engine variant. MTU Maintenance established the location with the aim to increase its presence in emerging markets and to offer its innovative services portfolio locally as well. Today, the company is China’s market leader for engine MRO and one of the top players in Asia.

“Taking into consideration the fact that some providers already have joint ventures in Asia, it is very likely that these shops will provide engine MRO for next generation wide-body engines as well. At the same time, strong orders from Middle East airlines for widebodies may impact the equation, and engine MRO for wide-body engines could shift from Asia to the Middle East in future. MTU Maintenance is continuously reviewing and improving its workflow and flexibility in order to better fulfil changing market requirements, as a confirmation that we are on the right track and a well-recognized competitive player – not only in Asia, but worldwide.” – shares MTU Maintenance management.

Independent MRO vs. OEM

To continue, the warfare between providers may not only occur for the location, but for the production. It is not a secret that the new technologies will allow original equipment manufacturers (OEMs) to hold a stronger position in the market of MRO, thereby surpassing the independent players at the expense of owning a unique knowledge of maintenance and limited access to relevant certificates. The situation is best described in the engine segment as original equipment manufacturers (OEM‘s) are dominating present MRO and will, most probably, hold their position for the NextGen widebodies. And if OEM’s are controlling 85% of engine MRO market, it is hard to imagine how independent MRO’s are going to develop technical maintenance hubs.

“Given the increasing OEM coverage for engine maintenance, it is very likely that MRO for next generation widebody engines will be to an even greater extent performed either in OEM shops or within the OEM partner network. As a result, it will be the decision of the OEMs which airlines they will license and/or whether they will develop regionally” – continues MTU Maintenance.

Nevertheless, it is not the right time to panic, because in terms of globalisation, every player of the market is interconnected and needs each other. For example, according to Zilvinas Lapinskas, CEO of FL Technics, despite the competition between independent MRO’s and OEM’s in the engine maintenance for NextGen widebodies, there are cooperation possibilities for players in the airframe maintenance. Original manufacturers benefit from cooperation with independent MROs, as it extends OEMs service network. And, respectively, MROs benefit from cooperation with OEMs, because it is very difficult to get the expensive maintenance license for individual technical operator.

In any case, competition and cooperation between both OEMs and MROs – is a long-term trend, which has become an integral part of the existing MRO market. Will the balance between MRO markets in Asia and North America be achieved? Probably, the answer to that question will come after decade or more. One thing is for sure - Asia grew rapidly in the recent years, but the crisis is over, and the North American aviation market as well has actively begun to return its power. Yes, it is expected that in the 2030 Asia will be the largest aircraft operator. But whether it will be the largest MRO market? Quite possibly, but not due to the maintenance of the NextGen widebodies. This niche can possibly belong to North America.

Malaysia Airlines website hacked by islamists

The official Malaysia Airlines website has been hacked by a group claiming to support Islamist terrorist organization ISIS.

On accessing the website, users were presented with a picture of a lizard, which read "Error 404 - the plane could not be found" and "Hacked by Lizard Squad -- Official Cyber Caliphate”,informs Lenta.ru with the reference to CNN. The browser tab also read "ISIS will prevail."

The airline added the issue has now been resolved with its service provider and the system is expected to be fully recovered within 22 hours.In a post on its Facebook account, the airline denied its internal servers, which contain passenger information, had been compromised. It said it's the airline’s Domain Name System (DNS) that had been hijacked, redirecting the users to the hackers' website.

Source and image: Lenta.ru / Malaysian Airlines

Flying solo: will co-pilots become a thing of the past?

It is no secret that crew-related costs typically represent 10-20% of an airline’s cost structure – as much, if not more, than any other cost bucket, except fuel, at least before its recent drop in costs. Naturally, reducing the size of cockpit crews for commercial aircraft has been a topic of theoretical discussion among aerospace industry representatives for many years now. Nevertheless, while today realization of such a solution is far less science fiction than it was a few years ago, the possibility of its actual implementation still remains in question.

In 2010 Ryanair's CEO Michael O'Leary made another one of his controversial statements, declaring he wants to eliminate co-pilots in his Boeing 737 jets. In an interview with Financial Times he argued that they are essentially unnecessary in modern aircraft because most of the flying is highly automated. “In 25 years with over about 10 million flights, we’ve had one pilot who suffered a heart attack in flight and he landed the plane,” he told the paper. While O’Leary is well known for making far more outrageous comments, his thoughts on single-pilot operations are not new to aviation, and are even backed by some of the industry players.

For instance, in 2013 a big European research programme has begun to look at the possibility of a single-pilot flight deck for commercial operations. The project, called ACROSS (“Advanced Cockpit for Reduction of Stress and Workload”), is funded with €30 million and brings together a team of 35 industry and research partners, including such giants like Thales, Airbus and Boeing. Moreover, NASA has recently reported it’s advancing an airliner flight deck of the future that features one seat in the cockpit for a captain and one on the ground, occupied by an operator filling the role of either “super dispatcher” or first officer. However, the actual benefits of such a concept remain ambivalent.Flying solo: will co-pilots become a thing of the past?

“Co-pilots are currently employed on flights to monitor the other pilot and intervene if there is a problem or share the work if there is too much for one person to do. So, if new technology could carry out all those functions, theoretically we wouldn’t need a second pilot anymore,” comments Skaiste Knyzaite, the CEO of AviationCV.com. “However, there are other important questions to be asked, even if their importance is more for the long-term. Where will the PICs of the future come from if they have no apprenticeship as first officers? Can new pilots go straight to command? Would you mind if the only pilot on your A380 was a recent piloting graduate?”

Five years ago, O’Leary argued that since regulations allow trains to operate with just one driver, the practice ought to be admitted at least for short-haul flights. According to Ryanair’s CEO, flight attendants could cover for co-pilots, who he stated are essentially required only to “make sure the first fella doesn’t fall asleep and knock over one of the computer controls.” However, while this scenario is already common place in the military with success, the situation is a little different when dealing with paying clients, therefore the risk factor is increased. After all, the international aviation system has reached unmatched levels of safety and reliability not only because of greater automation, but also thanks to a widely accepted global standard for cockpit behaviour and cooperation. In the meantime, there are some other obstacles the players are likely to face.

“Of course, airlines would like to reduce pilot costs. For example, instead of sending four pilots on a long-haul flight, they could send just two. Moreover, it may be the answer to the industry-wide worries that the worldwide pool of pilots will decrease over the next two decades while air-travel volume are expected to double. However, it is likely that current practicing pilots will not welcome this direction as it could potentially mean the end of their career. Moreover, current regulation is likely to be the real stumbling block to this progression,” shares the CEO of AviationCV.com “Nevertheless, one needs to take such developments with all the seriousness. After all, we might be on the verge of an industry-wide revolution.”

Source and image: AviationCV.com

U.S. AF identifies Boeing 747-8 platform for next Air Force One

Secretary of the Air Force Deborah Lee James, in coordination with the Undersecretary of Defense for Acquisition, Technology and Logistics Frank Kendall, has determined the Boeing 747-8 will serve as the next presidential aircraft, commonly known as Air Force One.

“The presidential aircraft is one of the most visible symbols of the United States of America and the office of the president of the United States,” James said. “The Boeing 747-8 is the only aircraft manufactured in the United States (that), when fully missionized, meets the necessary capabilities established to execute the presidential support mission, while reflecting the office of the president of the United States of America consistent with the national public interest.”

Analyses of the capability requirements conclude a four-engine, wide-body aircraft is required to meet the needs of the Air Force One mission. Market research determined there are two four-engine platforms that could meet the requirements; the 747-8 manufactured by Boeing in the state of Washington, and the A380 manufactured by Airbusin Toulouse, France.

The decision, made official through a Determinations and Findings document, authorizes the commercial aircraft purchase by other than full and open competition. This decision, in conjunction with the notification of the Air Force’s intent to award a sole source contract to Boeing for the modification of the 747-8, allows discussions with Boeing that will likely lead to a contract for the aircraft platform as well as the modifications necessary to missionize the aircraft.

“This decision is not a contract award to procure 747-8 aircraft,” said Col. Amy McCain, the Presidential Aircraft Recapitalization (PAR) program manager. “We still need to finalize the overall acquisition strategy and conduct risk-reduction activities with Boeing to inform the engineering and manufacturing development contract negotiations that will define the capabilities and cost.”

The Air Force wants to own enough of the technical baseline to permit competition for sustainment throughout the aircraft’s planned 30-year life cycle. Competition can keep costs down, spur innovation and provide options.

“We are committed to incorporating competition for subsystems of the missionized aircraft as much as practicable, and will participate substantively in any competitions led by the prime contractor,” James said.

“The current fleet of VC-25 presidential aircraft has performed exceptionally well, a testament to the Airmen who support, maintain and fly the aircraft,” James said. “Yet, it is time to upgrade. Parts obsolescence, diminishing manufacturing sources and increased down times for maintenance are existing challenges that will increase until a new aircraft is fielded.

“The Air Force provides the president with safe and reliable air transportation with high levels of security and communication capability as the alternate airborne White House,” she added. “This platform will meet the requirements necessary to provide that level of service for future presidents.”

Source and image: USAF

Air France to cut 800 jobs

In 2015, Air France will benefit from the impact of the measures taken within the framework of Transform 2015 and from the fall in the fuel price. However, as announced in December 2014, the Group will also have to contend with the weaker unit revenue trend that has developed since the summer of 2014, which requires the implementation of additional measures.

The Air France management presented a number of actions to the Corporate Works Council: downwards revision in fleet and capacity growth, new initiatives to drive revenues, the reinforcement of ‘purchasing’ initiatives, maintained wage moderation and productivity efforts and further adaptation of headcount to requirements.

In particular, during a meeting of the Corporate Works Council to be held during the first fortnight in February, the Air France management will provide details on proposed new Voluntary Departure Plans. These Voluntary Departure Plans will relate to ground staff and cabin crew and aim at the departure of approximately 800 people.

These measures relate to both the full execution of Transform 2015 and an immediate adaptation to the Group’s competitive environment.

Source and image: Air France

Lufthansa subsidiary signs new wage agreements with pilots’ union

Settlement at Eurowings to run for five years – Sustainable collective rules for pilots at SWISS International Airlines and Austrian Airlines. New wage agreements apply for the approximately 300 pilots at Eurowings GmbH as of 1 January 2015.

At the beginning of the year, the airline reached agreement with the Vereinigung Cockpit pilots’ union on new settlements that are to run for five years. They govern such matters as developments in working conditions and “grandfathering clauses” for the duration of the agreements. The collective bargaining partners agreed on a wage increase of 2.5 per cent for the year 2015 and at least two per cent for subsequent years, depending on the rate of inflation. Signing the wage agreements means that the forthcoming renewal of the Eurowings fleet with Airbus A320 aircraft, and thereby the safeguarding of Eurowings and its future prospects, is being aided and supported in terms of collective bargaining, too.

Sustainable settlements with various pilotsʼ unions have already been reached for other flight operations in the Lufthansa Group.

These recent wage settlements mean that the Lufthansa Group and almost all its pilots now have agreements that reflect changes in the industry and that introduce sustainable wage conditions. Still outstanding, however, are wage agreements at Lufthansa German Airlines, Lufthansa Cargo and Germanwings. In December 2014, Lufthansa offered further talks on unresolved topics, along with a concrete plan for arbitration. The Vereinigung Cockpit pilots’ union turned down this offer. Lufthansa is always prepared to cooperate on a viable solution for all sides.

Source and image: Lufthansa

US drone pilots are massively bailing out

Hundreds of American drone pilots have resigned, complaining of long hours and excessive stress involved in bombing jihadist targets remotely, from thousands of miles away.

A growing crisis has led the US air force to pull fighter pilots out of their cockpits and put them into “office” flying seats in America to operate the armed Predator and Reaper drones attacking Islamic State targets, reports Lenta.ruwith the reference to The Times.

Air Force chiefs are considering to offer $25 000 in bonuses each year to persuade operators to stay after a report found that 240 pilots quit. According to pilots, it psychologically difficult to see dead people on the screen translated from drone’s camera.

Source and image: Lenta.ru