On the Record with
ROBERT L AVERY, PRESIDENT, BOEING AIRPLANE SERVICES
Boeing Looks to the Aftermarket
Acquisitions
and joint ventures in the world of MRO (maintenance, repair and
overhaul) are very much in the cards at Boeing Airplane Services
-- the group's goal is to be the global Number One aftermarket provider
for Boeing aircraft.
"Yes, we are in competition with many of our airline customers,
but we are at the same time in partnership with them," Boeing
Airplane Services president Bob Avery told Show News. "This
is not a conflict because in our mind the maintenance market has
so many suppliers that Boeing is not going to change the competitive
landscape."
Others might disagree as the 600-pound gorilla looks aghast at the
tremendous duplication of infrastructure, tooling, parts inventories
and different maintenance programs offered by every shop and says:
"Surely there has got to be a way to consolidate and bring
value to the system?"
Just ask Avery. "We are studying that, and we are looking at
a couple of strategic options that involve acquisition or JVs,"
he says. "We are going to be one of the consolidators in this
industry."
What burns Boeing is that in all its past years it's concentrated
on building new aircraft rather than looking after them, choosing
to pursue its 50-60% or so share of the $70 billion-a-year new plane
market while hardly playing at all in the even bigger market for
maintenance and services.
This has been brought home by Airbus' becoming more involved in
services through back-door tie-ups between its parent EADS and Sogerma
(the latest involving an MRO JV in the U.S. with Northrop Grumman)
and through the pending formation of the European Military Aircraft
Company, which will combine the airframe operations of Alenia and
Aerospatiale, including ATR. It will perhaps incorporate Alenia's
Aeronavale MRO operation as well, which is a Boeing partner on a
number of programs.
"Our future forecast for commercial aviation over the next
20 years puts new airplanes plus services at $4 trillion, of which
$2.8 trillion will be services," Avery says.
Against that, Boeing's total revenue for commercial and military
aircraft services is running at $3 billion a year (of which Avery's
basically-engineering business is a small but fast-growing part;
among other members are BoeingFlightSafety, Aircraft Trading and
Boeing Capital). Boeing vice-chairman Harry Stonecipher has says
the services group must at least double revenues to $6 billion in
the next five years. He thinks $10 billion is possible.
"Now you can understand why we see such tremendous opportunity
for growth," Avery says. "We're starting with a very small
slice. We have a good chance of doubling the size of the business
we are in right now, and doing some new things as well."
Today, Boeing Airplane Services employs 2,500 people in three locations-Puget
Sound, Long Beach and Wichita. Further growth could well diversify
this spread, Avery says.
By John Morris
|
2000 was
the Year of the Freighter, according to Boeing Airplane Services.
"As of today we have certified passenger-to-freighter
conversions of everything but the 747-400 and 767-300,"
BAS president Bob Avery told Show News. "We do
the first one or two aircraft, then license the engineering
to our partners around the world."
The group
was instrumental in the deal where Boeing took 44 Boeing 757s
from British Airways in trade for new aircraft, and converted
the trade-ins to freighters for DHL. The first, equipped with
special innovative cargo systems, was delivered on March 2;
the remainder will be converted by alliance partners Singapore
Technologies in Mobile, Alabama, and Israel Aircraft Industries.
BAS continues
to focus on proprietary products for Boeing aircraft. These
include the retrofit of Boeing 777-style interiors in older
737, 747, 757, and 767 aircraft, the retrofit of overhead
attendant and crew rest facilities in the 777, and "Big
Bins," offering 60% more storage capacity, in 737 and
757 aircraft, that will be available next year.
"We're
focusing on those products we can offer both in retrofit and
in production," Avery says
.-J.M.
|
After
a cultural opposition to winglets because Airbus had them,
Boeing has embraced the bigger, more dramatic-and more effective-blended
winglets offered by its business buddy Aviation Partners.
German airline Air Berlin just took delivery of the first
set fitted in production to a Boeing 737NG, and Hapag-Lloyd
recently became the first airline to operate them with a retrofit
set.
"We're
looking at further winglets on the 737 classic, 757/767 and
747," Boeing Airplane Services president Bob Avery told
Show News.
"Counting
retrofits we could easily sell a few hundred sets a year,"
he says. Which, at around $750,000 a set for a 737NG, is a
nice piece of change.
Winglets
on the Boeing 737-800 have already proven to reduce block
fuel burn by 3-4%, add 140 nmi in range, and allow 2,000-4,000
pounds in additional payload.
-- J.M.
|
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