Barfield bids to expand parts-repair business in Brazil

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US components-maintenance specialist Barfield plans to set up a second Latin American repair shop in Brazil, while the existing facility in Bogotá is expanding its technical capabilities.

The Miami-based subsidiary of French MRO group Sabena Technics has long been planning to establish a footprint in Brazil, says Frederic Denise, Barfield's chief executive. But a 10-year Airbus A320 component support contract with Avianca-TACA changed the company's short-term priorities in 2010.

Barfield has installed an avionics repair facility in Avianca's hangar in the Colombian capital from where it can service A320 and A330 equipment both for Avianca-TACA group carriers and third-party customers. Operations at the wholly owned Barfield subsidiary - this is no joint venture with the airline - began with four employees in January 2013.

But now Denise has gone back to his plans to make an advance onto Brazilian soil - partly due to the sheer size of the domestic market, but also to circumnavigate the country's time-consuming customs processes.

Within the next two years, Barfield wants to have a "presence" in Brazil, he says, "with the possibility... to set up or acquire some capacity for repair". He is now at the stage of talking and visiting existing repairs shops in Brazil, he adds.

Meantime, plans are going ahead to expand the capabilities of the operations in Bogotá, while the customer base is to grow to other Latin and North American carriers. The next step is to support large and heavy components, such as cockpit seats and mechanical equipment, which are expensive to ship over long distances

Thereafter, Denise wants to introduce labour-intensive component work to benefit from Colombia's relatively low cost base over other locations.

He likens the facility to Barfield's Phoenix, Arizona repair shop, which grew from three to 15 employees over the past 12 years. But the Bogotá site appears set to expand at a faster rate. Denise says that stage three - labour-intensive component MRO with around 15 staff members - could be reached as early as the second half of 2014.

After Barfield's turnover was "just under $90 million" in 2012, Denise expects to hit the $100-million mark in 2014. Between 35% and 40% of the business are currently being generated in Latin America.

But while the southern continent and Caribbean regions promise much faster growth than the mature US market, he does not expect the split to change dramatically soon. He predicts that the huge North American MRO will maintain its share with a "small or reasonable" growth rate of the passenger airline market and the cargo carrier business to pick up momentum again from 2014.

Denise says that Barfield will not move its operations away from the USA to, for example, Mexico. The business growth in Latin America "will not be to the detriment" to the company's operations on the northern continent, he says: "I believe to be a player in the US, you need to be in the US."