ANALYSIS: KLM UK Engineering focuses on narrowbodies

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Regional aircraft support specialist KLM UK Engineering is shifting its focus to narrowbodies as it strengthens its position within Air France-KLM's MRO network.

The Norwich-based MRO provider has been supporting Boeing 737s for a number of years, and serves as an overflow facility for KLM's 737 C-check line in Amsterdam. But corresponding technical capabilities for the Airbus A320 family are only being established now, as the UK company's mainstay around Fokker and BAE Systems regional aircraft is diminishing, with the legacy types gradually migrating from Europe to other regions.

Fokker aircraft have traditionally been at the centre of KLM UK Engineering's capabilities. The facility was set up as in-house maintenance department for Norwich-based Air Anglia when the airline was formed from three operators in 1970. Air Anglia had a fleet of Fokker F27s and F28s, before it was merged with three other carriers in 1980 to become Air UK. As the Dutch manufacturer developed the two models into the respective Fokker 50 and 100 series, Air UK updated its technical capabilities accordingly and also started BAe 146/Avro Regional Jet support.

KLM - which had already been an operational partner of Air Anglia - gradually increased its shareholding in Air UK, with the latter becoming a wholly owned subsidiary in 1997 and subsequently changing its name to KLM UK.

Today, the East Anglian MRO facility is Air France-KLM's centre for Fokker and BAE Systems aircraft support. KLM's Cityhopper branch sends its Fokker 70s across the North Sea for base maintenance, while Air France's Irish regional subsidiary CityJet has contracted its Fokker 50s and Avro RJ85s to be serviced in Norfolk. Air France is trying to sell the Dublin-based carrier, however.

KLM UK Engineering turned over about £27 million ($44 million) last year, and around two-thirds of its business is generated by the parent group, with the remainder coming from third-party customers. It also operates a line maintenance network with a number of stations across the UK.

Managing director Paul Chün says that the capability expansion to the A320 was prompted both by the decrease in the legacy regional fleet and growing customer demand to service the narrowbody. Base maintenance will not pose a difficulty, because structural damage on A320s is not inherently different to that on 737s. Developing the relevant skills and quick response times in line maintenance - where potential delays have an immediate impact on an airline's operations - will be a greater challenge, he says.

The MRO provider thus needs to draw on the parent group's experience with the A320. Maintaining Embraer 170/190s as a future activity is not under consideration, says Chün, because the Brazilian types are being serviced by KLM subsidiary Martinair at its Regional Jet Centre in Schiphol.

The move toward the A320 was also a result of a wider Airbus support shift within Air France Industries KLM Engineering & Maintenance's network due to the parent group's Transform cost-cutting programme. Air France has relocated A320 heavy checks from its Toulouse base to Aerotechnic Industries, an airframe maintenance joint venture with Royal Air Maroc in Casablanca. AFI KLM E&M therefore wanted to establish another European facility to support the narrowbody for potential customers in the northern part of the continent.

The Norwich site offers lower labour costs than KLM E&M's main facility in Amsterdam, which would suggest that the Dutch airline will also move more 737 base maintenance to the UK - not unlike Air France's A320 support transfer to Morocco. Chün insists, however, that KLM UK Engineering continues to serve only as an overflow facility for KLM's 737 MRO operations. This is partly due to the fact that airframe heavy maintenance tasks on current-generation 737s are being phased into lighter, more frequent C-checks, which are well-established at KLM's operational base.

Chün nevertheless wants to make KLM UK Engineering more efficient. After he joined the MRO provider in January 2012 from AFI KLM E&M's auxiliary power unit and pneumatic equipment repair shop Epcor in Schiphol, he started a number of lean manufacturing initiatives to slash costs and improve turnaround time.

One of KLM UK Engineering's two main hangars - each of which can accommodate two aircraft - has been refurbished to improve lighting, and equipped with large TV screens to monitor work progress and highlight potential hold-ups. A sheet-metal shop has also been updated, while turnaround time for aircraft checks improved 10% in the first development phase, says sales director David Spalding.

The MRO provider operates out of four hangars at Norwich, with a permanent staff level of about 375 employees. Additional contractor staff are being recruited when necessary. Two modern hangars are used for heavy checks, while two old facilities - from Norwich's air-force days from the 1940s until 1960s - are used for workshops, as well as a single aircraft bay. The two old hangars are partially rented to aircraft painting company Air Livery.

The UK aircraft refinisher - which is majority-owned by Indian MRO provider Air Works Engineering - plans to construct a purpose-made facility on the northern side of Norwich airport, as the outdated existing buildings cannot be adequately heated for painting without huge energy losses. However, the construction of that new facility could take several years, says Chün, as it conflicts with public road plans in the same area.

Chün does not expect KLM UK Engineering to build new hangars in the foreseeable future. Any business growth will have to be accommodated in the existing site through greater efficiency.

The MRO provider wants to build an engine test pen, however. Post-maintenance ground run-up tests are currently being conducted on the apron. But in future this needs to be done in an appropriate facility due to noise regulations. In 2012, AFI KLM E&M threatened to abandon Norwich if the facility could not be provided, but Chün says that the planning approval process is going ahead now, and construction of the test pen is expected to start by year-end.

Aircraft dismantling could become an additional business area in future. KLM UK Engineering has stored aircraft in the past, as Norwich is a dry location by UK standards. Britain's predominantly westerly winds direct moist air from the Atlantic across the island nation. Much of that humidity has usually precipitated when the air masses reach the east coast. Storage could be taken a step further, adds Spalding: the MRO provider is evaluating the parting out of aircraft as a potential revenue stream.