MRO Investment Heats Up in Southeast Asia

 - April 3, 2019, 9:30 AM
A new JV involving SIAEC and Nokscoot will support the low-fare carrier's fleet of Boeing 777-200ERs. (Photo: Flickr: Creative Commons (BY-SA) by masak2_ukon)

A region of rapid growth and huge potential, Southeast Asia continues to witness a surge in aerospace activity as providers of all sizes vie to capitalize on rising maintenance, repair, and overhaul (MRO) demand. In recent weeks, several companies have announced intentions to expand their presence and support the region’s growing fleet plans.

Among the latest contenders—Malaysia-based newcomer Sapura Technics—signaled its entry into the market on April 2 with an opening ceremony led by Malaysian Prime Minister Tun Dr Mahathir Mohamad. Owned by Sapura Resources Berhad, the narrowbody MRO eyes a July launch date once it receives Part 145 approval from Malaysian authorities.

With two hangars at Senai International Airport, Sapura Technics will first concentrate on line and base maintenance up to C checks for Boeing 737 and Airbus A320-family aircraft. Plans include adding facilities for interiors, wheels and brakes, hydraulics, and safety equipment. 

Elsewhere this week, SIA Engineering Company (SIAEC) inked two agreements including a new $1 billion comprehensive services agreement with its parent company Singapore Airlines (SIA) on April 1. The new contract calls for SIAEC to provide MRO services and fleet management support for a two-year period, with an option to renew for a further two years. The new deal replaces SIAEC’s 2015 agreement with SIA.

In a separate development, SIAEC and low-cost carrier NokScoot formed a new line maintenance joint venture (JV) on March 31 to support the carrier’s Boeing 777-200s and fleet-expansion plans. Singapore Airlines' Scoot Tigerair owns 49 percent of NokScoot, while Thailand’s Nok Air holds the remainder. 

The new JV will carry a registered capital base of approximately $2 million, with NokScoot holding a 51 percent stake and SIAEC holding the remaining 49 percent. Initial plans include providing line maintenance at Don Mueang International Airport before expanding to other airports across Thailand. The agreement boost SIAEC’s current network of line maintenance stations to 34 airports in seven countries outside of Singapore.

In the business aviation sphere, Dassault Aviation recently announced plans to acquire ExecuJet Malaysia’s MRO facility at Subang Airport in Kuala Lumpur. With a launch date planned between six months and a year, the company will focus on strengthening its aftersales services by adding maintenance capabilities for the Falcon 8X, 7X, and 2000 before expanding to Falcon 900 models.