Airlines look at partnering with investors for MRO centres
Investment in aircraft maintenance, repair and overhaul (MRO) centres in Thailand has caught the attention of both domestic and foreign mega-companies as the airline industry bounces back from the doldrums caused by the Covid-19 pandemic.
The fast recovery of the airline industry is due, for the most part, to tourists returning thanks to the government’s visa-free policy and other tourism promotion campaigns.
Before Covid-19, French aerospace giant Airbus predicted that the value of MRO centres in Asia Pacific would rise to US$64.6 billion in 2030. In the Asean region, Airbus estimated the MRO market at US$6.57 billion or 220 billion baht by 2030, with Singapore leading the way with a 25% market share and Indonesia and Thailand coming in second and third places respectively.
Now, with the impact of Covid-19 on the airline industry having all but faded, these estimations are making their way back again to attract investors in the aircraft maintenance industry.
Keerati Kitmanawat, president of Airports of Thailand (AOT), recently told Thansettakij newspaper that the airport authority is investing in an MRO center at Don Mueang International Airport in Bangkok together with Forth Corporation.
According to him, Forth will hold 75% of the shares and AOT the rest in the facility that is certified for A-check (light maintenance), C-check (heavy maintenance), part maintenance, and non-destructive testing.
The 800-million-baht Don Mueang MRO centre will be providing services to mainly narrow-body planes and is expected to be operational by October 2026, he added.
Keerati said that AOT has also invested 722 million baht in an MRO centre at Chiang Rai Airport with Aviation Industry Corporation of China.
The centre, which will be certified for A-check, C-check, preflight check, exterior washing and polishing, will open in July next year, he said.
Meanwhile, Chai Eamsiri, chief executive officer of Thai Airways International (THAI), recently said that the national flag carrier now has sufficient funds to invest in an MRO centre at U-Tapao Airport.
The airline, which has been under a business rehabilitation plan for more than two years, has reportedly accumulated more than 50 billion baht of cash to invest in airline expansion and maintenance to cope with the rising demand in the industry.
Chai said THAI could co-invest with foreign companies such as Airbus to build an MRO centre budgeted at of 7-8 billion baht. When finished, the U-Tapao MRO centre will be a sustainable source of income that will keep the flag carrier afloat in any future crises.
Wutthiphum Jurangkool, CEO of Nok Air, told reporters that the airline is studying an MRO investment project with a few foreign joint investors with a budget of 1.4 billion baht.
He said the airline is surveying suitable airports in Thailand to build the centre. So far, the contenders are airports in the Northeastern region under the Department of Airports. However, Nok Air will not invest in U-Tapao airport to avoid competition.
Nok Air’s MRO centre is projected to be operational by 2026 and will be capable of heavy maintenance of landing gear and other plane components apart from the engine.
