China Eastern Airlines is talking to Singapore Technologies Aerospace (ST Aero) and Air France Industries individually about its plans to establish an aircraft maintenance joint venture after the failure of its long-running discussions with SR Technics.
The Shanghai-based carrier wants to spin off its maintenance division and bring in a foreign partner to boost the unit's technical capabilities and management expertise. It has been co-operating with Swissair unit SR Technics since the late 1980s. However, the financial collapse of the Swissair Group earlier this year has prompted China Eastern to search elsewhere for partners.
ST Aero confirms it is looking for expansion opportunities worldwide, but says it would be "premature" to comment on any specific talks with potential partners.
A co-operation deal with China Eastern would be seen as a good strategic move for the company, however, as Singaporean companies in general are being encouraged by their government to expand their presence in mainland Chinese markets.
Air France Industries, meanwhile, struck a deal earlier this year to train China Eastern engineers to perform heavy maintenance checks on the latter's fleet of Airbus A340-300s. The company says it views the fast-growing Chinese aviation market as a "top priority".
The A340 overhaul deal is a "first step, but obviously we do pay attention to any new possibility of co-operation in this fast-growing market", it says.
China Eastern says though it "seeks co-operation" in the maintenance sector, any plans to spin off its technical division may have to wait "two or three years" until the consolidation of China's many airlines into just three groupings has been completed. Government approvals would also be required.
The carrier's two main rivals Air China and China Southern have already spun off their maintenance operations. The latter partnered with Lockheed Martin and Hutchison Whampoa to form Guangzhou Aircraft Maintenance Engineering, while the Chinese flag-carrier opted to form the Ameco joint venture with Lufthansa Technik.
Source: Flight International