Air France Industries is expanding its RMO presence in the Asia-Pacific region, concentrating on customised products, fleet performance and partnerships/proximity services, in what Ludovic Loisel, the company's vice-president business development, describes as a fast-growing, changing and challenging business environment.

Speaking at Asian Aerospace yesterday, Loisel predicted that AFI's turnover for the coming year would match but not exceed this financial year's $1.5 billion. The company has 100 international customers and 10,000 employees worldwide, working in five main centres which feature a total of 59 maintenance bays. Around a third of the business is engine-focused while the rest is airframes and ancillary parts.

Post-11 September pressures haven't had as much impact on AFI as originally predicted and both Loisel and his colleague Bruno Delile, vice-president components division, say the main reason is the fact that airlines experiencing difficulties are retiring older aircraft for which AFI wouldn't have been interested in signing RMO deals anyway.

Says Loisel: "We believe that genuine recovery will start to become apparent in the last quarter of 2002, mirroring the consolidation of the airline industry in the region and China.


"Around 80% of the South Asian fleet is owned by eight carriers out of 28 while three majors in China (out of 34) account for more than three-quarters of all traffic.

"Ongoing mergers around the three majors Ð Air China, China Eastern and China Southern Ð mean that each group will represent at least 150 aircraft, mainly comprising modern fleets of B737-NG, A320, B757, A340 and B777 aircraft."

AFI's major clients in the region include China Eastern, Air China, China Southern, Vietnam Airlines, Thai International and Asiana and the company is targeting both partnerships and acquisitions to enhance its ability to offer proximity solutions with a view to reducing AOG time and repair/inventory costs.

In each defined market Ð Southeast Asia, China and South Korea Ð AFI is building up co-operation with local partners who know the markets well in order to increase proximity with its customers.

It already has a relationship with Nangxin Avionics in China and Air France's SkyTeam partner, Korean Air Lines, in South Korea.

"Market growth in Asia," says Loisel, "is underpinned by more reliable, new generation fleets and especially A320, A330, A340 and B777. Despite this enhanced reliability, component support may prove costly in terms of repairs, time, materials and especially inventories because OEM spares are increasingly expensive."

Source: Flight Daily News