Airline expects to slash maintenance overheads by over 30% following deals to place overhaul work with third parties

Delta Air Lines is to move its Boeing 757/767 and MD-88/90 maintenance to two third-party providers – Air Canada Technical Services and Avborne – in its intensified campaign to cut costs and avert bankruptcy. Atlanta-based Delta was saved from bankruptcy court protection by pilot union concessions late last year, but has been hit hard by rising fuel costs.

The two contracts, expected to save the USA's number three carrier $240 million in maintenance costs over five years, will assign the work on Delta's 136 MD-88/90 narrowbodies to Miami-based Avborne, while Air Canada's Vancouver facilities will handle Delta's 208 Boeing 757/767s. The outsourcing will cut its heavy maintenance costs by 34% over the five years, says the airline.

The 757/767 contract is worth $300 million and is one of the largest outsourcing deals awarded recently, says the Air Canada division, which will add about 300 jobs, many to be filled by furloughed workers, when the work begins in May. Avborne will add about 200 workers to the 700 at its facilities near Miami International Airport.

The move will see between 1,600 and 2,000 jobs lost from Delta's TechOps unit, although that number of redundancies had been expected. It leaves American Airlines as one of the last US majors to perform most maintenance, repair and overhaul in-house.

Delta will retain maintenance on the Pratt & Whitney JT8D-series engines that power the MD-88s at its own Atlanta Hartsfield airport shops, which will also gain some routine repair work now performed in the airline's Tampa, Florida, hangar. Tampa will do some line maintenance and ground-service equipment work.


Source: Flight International