ANALYSIS: GE faces UK overhaul capacity challenges

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GE has asked us to clarify that while moving CFM56 work away from the Wales site is an option, no decision on this has yet been taken. Wording in the relevant section has been adjusted to reflect this.

General Electric's two UK engine shops - at Nantgarw in Wales and Prestwick, Scotland - form the backbone of the manufacturer's overhaul network for widebody powerplants.

But while at the Welsh site CFM International CFM56 support will likely have to be given up to create more space, GE Caledonian is facing lower volumes until the new GEnx generation requires regular shop visits.

The facility in Nantgarw, near Cardiff, is the manufacturer's only group-owned overhaul shop for GE90s - the incumbent powerplant on the latest Boeing 777 generation - and GP7200s, manufactured by Engine Alliance, the joint venture with Pratt & Whitney for the Airbus A380.

GE Caledonian in Prestwick, near Glasgow, meanwhile services the CF6 and GEnx series. The legacy CF6 is also supported at GE's Celma site in Petropolis, Brazil, but overhaul capability for the successor GEnx series for the 787 and 747-8 has been established only in Scotland.

GE owns five engine shops - Wales, Caledonian, Celma, Strother Field in Kansas, and a facility in Kuala Lumpur, Malaysia - and has overhaul partnerships with a dozen airlines and maintenance providers, such as KLM in Amsterdam and SR Technics in Zürich. GE is also assisting Emirates with building a powerplant shop in Dubai, although this will only service the UAE carrier's 777 and A380 fleets.

The Welsh facility was taken over from British Airways in 1992 as part of a GE90 support deal for the airline's then newly ordered 777s. BA wanted to reduce its engine MRO footprint by outsourcing respective services to external suppliers. However, GE not only took over the plant, but also continued BA's operations for the existing fleet, including support both of the Rolls-Royce RB211s powering the airline's 747-400s and of Concorde's Rolls-Royce/Snecma Olympus 593.

Today, GE is still overhauling RB211s for BA, but the service is not offered to other airlines and will be gradually phased out as the UK carrier retires its 747s. The Welsh site is used for support of CFM56s, but this line, too, could be closed down when more capacity is needed for widebody engines. GE wants to focus on the GE90 and GP7200 in Wales in future, with the 777 engine to be the biggest growth driver, says Mike Patton, the facility's managing director.

The shrinking RB211 business is vacating some capacity. But since the 1.2 million ft² (111,500 m²) shop cannot be expanded for further overhaul lines, CFM56 support could be transferred to other sites if more space were needed, says Patton. No schedule has been set for the move, he says, because the CFM56 has thus far served as a convenient "buffer" during work fluctuations for other types.

GE expects that over the course of 2013, 475 engines will be serviced at its Welsh site, where around 1,200 staff are employed. The GE90 generates the greatest business, accounting for around 40% of powerplants, followed by the CFM56 with around a third of throughput. The remainder is evenly split between the GP7200 and RB211.

In January 2013, GE opened a 20,000ft² repair centre for GE90 fan cases at Nantgarw. This is part of a five-year investment plan to develop more specialist component repairs at the facility. The capabilities will primarily be focused on cases and frames, and should generate significant growth in future, says Patton.

GE Caledonian - where around 800 are employed - is the manufacturer's only GEnx overhaul shop. Full support capabilities have been established for the type, although work levels have been light thus far as the GEnx is still in its initial operational phase and scheduled overhauls are not due for some time.

Meanwhile, the facility's main business of supporting CF6s has changed. As operators are retiring CF6-powered aircraft, such as the 767, their aftermarket demand has shifted from using costly new spares during an overhaul to employing used material. While airlines previously ordered the replacement of life-limited parts - such as compressor and turbine disks - with new equipment to achieve long run times between shop visits, they now demand use of used material that offers enough flight hours and cycles to see the aircraft through to retirement

Almost all of Caledonian's customers have become "interested" in pursuing that material strategy since the 787 entered service two years ago, says GE. Before that, the manufacturer says, there was only limited demand for the "cost-effective solution" to servicing mature engines. The average age of the CF6-80C2 fleet is about 15 years. Some powerplants have been in service for 25 years.

Employing used material is obviously much less lucrative than selling new parts. The challenge for the Caledonian shop is thus to maintain its business volume over the next three years or so, until the GEnx comes due for regular overhauls.