November 11, 2013
One big trend in recent aftermarket activity has been the increasing importance of OEM support, especially in engine work. For the biggest MRO deals, manufacturers often seem to compete mostly with shops that are part of a global airline, like Lufthansa or Air France.
But independent MROs are still significant players, especially in the airframe market, and even in the fiercely contested engine sector. The biggest independents still go head-to-head with their well-connected OEM and airline rivals, and even the smaller ones find a way to thrive in the niches that giant companies leave open.
While many OEMs want to own the airline customer and count on a steady aftermarket revenue stream, they are not always eager to perform the actual maintenance. If someone else can do it better, faster and cheaper, there is room for talented smaller companies to do well.
Many independents, both large and small, are betting there will be profitable room for them. They are investing in new capabilities, new products and platforms, and often in new geographical markets. That is true even in the toughest market—engines.
StandardAero obtains about half of its $1.6 billion annual revenue from the airline and fleet business that Senior Vice President Rob Cords runs. “We do engines,” Cords summarizes, and that includes powerplants from OEMs General Electric, CFM International, Pratt & Whitney Canada and Rolls-Royce, plus auxiliary power units made by Honeywell and Hamilton Sundstrand.
The MRO invests both to add capabilities and expand markets. “We made some investments in the last several years in P&W variants—PT6s and PW100s—and in the CFM56-7,” Cords explains. “Now we want to build out these businesses.”
So StandardAero is deepening capabilities in new-engine markets, bringing outsourced work inside so it can reduce turnaround times without buying rotables. And it is deploying field service representatives globally to complete on-wing repairs. The company also invests in making short turn times dependable in older markets. It is creating test cells for General Electric CF34s and CFM56-7s, each capable of testing the other engine to give customers reassuring redundancy.