Somkid reassures Airbus on progress for U-Tapao maintenance centre

Pierre Jaffre, president of Airbus Asia-Pacific, discussed with Somkid the arrangements for the project, which is regarded as a showpiece development for the Eastern Economic Corridor (EEC).
Airbus has teamed up with Thai Airways International (THAI) to construct the MRO centre at U-Tapao airport in Rayong, one of the three provinces in the EEC.
Also attending the talks were Jacques Lapouge, the French ambassador, and Georg Schmidt, the designate German ambassador to Thailand.
Somkid told them that the groundwork was being laid for the EEC’s infrastructure projects and that they were moving ahead as planned. He also advised them of Thailand’s cooperation with China’s Zhengzhou Xinzheng International Airport for the development of U-Tapao’s Airport City project.He said the MRO project could be run as a public-private partnership (PPP) scheme and the EEC Office would take charge of this. A contract for the project would be ready for signing this month, marking progress for the partners after a period of delay, he said.
 “Airbus knows that investing in the MRO centre in Thailand will yield the best economic return compared to other regions,” Somkid said.
“In May, negotiations will certainly reach their conclusion. The Airbus executive has flown in to discuss this matter in particular. If it (the negotiations) cannot be concluded, he will not go back. We’re confident that within this month, the contract signing will be made.”
According to a source from Government House, during the discussions Airbus expressed concerns over the joint investment between itself and THAI, especially relating to ownership of the project.
If the MRO project is specified as being owned by THAI, which is a joint investor with Airbus, the contract may not be able |to be signed under a PPP scheme because both are private enterprises, the source |said.
Given this constraint, Somkid has asked THAI chairman Ekniti Nitithanprapas to hold more discussions with Airbus, with a view to proposing that it sign the contract with the EEC Office, the source said. In such a case, the EEC Office would be the project owner, with Airbus and THAI as joint investors, the source said.
Of the total investment of Bt10.58 billion in the project, Bt6.333 billion will be made by the public sector and Bt4.255 billion by the private sector.
The expected return on the project is Bt38.87 billion, about Bt36 billion of which will be given to the public sector and Bt2.87 billion to the private sector. The expected economic return, excluding those from hi-tech employment valued at Bt80-billion and a Bt200-billion increase in income from services to foreign airlines, is about Bt22 billion.
Once the MRO centre is completed, THAI’s repair centre would be removed to pave the way for construction of U-Tapao airport’s second runway and a new passenger terminal. The centre is expected to start services in 2022.