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MTU Expects Particularly Strong MRO Business Growth from Asia

 - February 9, 2020, 7:58 AM
MTU Maintenance is seeing robust growth in Asia and is expanding its capabilities, especially for engines powering single-aisle airliners such as the CFM56-5B and CFM56-7B and IAE V2500-A5.

MTU Aero Engines expects customers in Asia to provide a continuously growing share of its overall engine-MRO business throughout the next decade and for China to account for an increasing proportion of MTU’s overall Asian MRO work throughout that period.

Today, Asia accounts for a quarter of all engine-MRO shop visits handled by MTU Maintenance. However, by 2030 Asian customers will provide about a third of all shop visits, according to Martin Friis-Petersen, senior v-p for MRO programs for MTU Aero Engines (Chalet J65). By then, customers in China will be generating approximately half of MTU Maintenance’s Asia-originating engine shop visits.

MTU Maintenance unit has two separate engine-MRO businesses. As a member of the licensed MRO networks operated by various engine OEMs, MTU’s OEM MRO business performs repairs and overhauls under contract for CFM International, Pratt & Whitney, GE Aviation and others. However, MTU Maintenance’s separate Independent business is a standalone provider of engine MRO for a wide variety of customers worldwide. Friis-Petersen told AIN that Asia already accounts for a “disproportionate” share of MTU Maintenance’s independent engine-MRO work, providing MTU with 40 percent of its standalone business.

MTU sees Asia continuing to offer strong engine-MRO business prospects throughout the foreseeable future. “Its macro-economics are displaying disproportionate growth,” said Friis-Petersen. “Asia will grow faster than we see other regions growing, and we expect China to be the dominant marketplace in Asia for MRO going forward.”

Friis-Petersen attributes MTU’s strong market position in Asia partly to the fact that its MTU Maintenance Zhuhai 50/50 engine-MRO joint venture with China Southern Airlines has been operating for nearly 20 years. Now MTU Maintenance Zhuhai is undergoing its second major capacity expansion within 10 years. When complete by year-end, the expanded facility will be able to handle 450 engine shop visits annually.

MTU Maintenance’s overall engine-MRO strategy, particularly in Asia, is to concentrate on the large and growing volume of business offered by engines powering mainline single-aisle aircraft types, rather than on widebody engines, according to Friis-Petersen. Today the key engine types for MTU are the CFM56-5B, the CFM56-7B, and the IAE V2500-A5. Numbers of shop visits for those three engines are increasing rapidly but most examples haven’t ever yet been inducted, he said. At some point well in the future, MTU’s engine-MRO emphasis will gradually switch to the new-generation Leap and PW1000G families.

MTU Maintenance also is strongly positioned in other large Asian markets such as Malaysia, India, Vietnam, and Korea, Friis-Petersen said. In Malaysia, MTU and Lufthansa Technik have operated the ASSB joint venture to repair high-pressure compressor and low-pressure turbine airfoils for CFM56, V2500, CF6-80C2, and GP7200 engines since 1991. The facility is expanding so it can handle 900,000 airfoil repairs annually, up from today’s 650,000.

On November 25 MTU Maintenance announced a 10-year contract to provide engine MRO for more than 100 CFM56-7Bs powering Malaysia Airlines’ fleet of Boeing 737-800s. MTU Maintenance Zhuhai will manage that contract, but MTU will continue to provide MRO capacity in at least two separate locations for every engine type it handles, said Friis-Petersen.