Lufthansa Technik (LHT) has taken the bold step of moving its Airbus A330/A340 heavy maintenance line from Hamburg to Manila, after the establishment of Lufthansa Technik Philippines (LTP) as a joint venture with local company MacroAsia.
The move fits in with LHT's strategy of shifting "routine", relatively labour-intensive maintenance checks to locations offering cheaper but technically competent and experienced staff.
LTP is preparing to start work on its first A340 heavy maintenance check in October, benefiting from manpower costs it reckons will be vastly lower than those commanded by German technicians. "The labour cost is 20% of Germany and there are no language problems," says LTP vice president marketing and sales Rainer Janke.
The company is 51%-owned by LHT, with MacroAsia holding the balance, and was established in September 2000 with equity of $30 million following Philippine Airlines' (PAL) decision to spin off its maintenance division. Employee numbers have since increased by around 450 to 1,750. Establishing the A330/A340 line has required an investment of around $20 million. "The operation, for the first year, was profitable," says Janke.
A PAL A340 and A330 will be sent to Hamburg in June and July, respectively, where LTP technicians will be trained to perform overhauls under the supervision of LHT staff. A PAL A340 will be the first to be overhauled in Manila, in October, and the first Lufthansa A340 will arrive there in December, adds Janke. All 12 of PAL's A330s and A340s will be overhauled "nose-to-tail" over a period of around a year. A second A330/A340 line is planned to open in 2003, and, in the longer-term, LTP hopes half of the aircraft it overhauls by then will come from third-party customers.
Despite the fact the aircraft themselves are to be brought to Manila, many of their installed components and systems will actually be sent back to Germany for repair by LHT, or to other vendors. This primarily covers avionics and pneumatic and hydraulic system parts.
In order to work on Lufthansa aircraft, and secure additional third-party work, LTP has applied to Europe's Joint Aviation Authorities for 145 certification. It already has the equivalent approvals from the US Federal Aviation Administration. The company inherited from PAL approvals to perform up to C-level checks on the 747-400 and D-checks on the 737. This work will "most probably" continue, according to Janke.
LTP is also about to decide whether to add a General Electric CF6-80C2 overhaul shop, following PAL and Lufthansa's withdrawal from service of all of their CF6-50-powered passenger aircraft. "This decision has to be done soon," says Janke. "It is most probable we will stay with GE or CFM International. However the test cell can only accommodate the CF6-50 so investment is needed to upgrade it," he adds.
PAL's Boeing 747-400s and A330s are equipped with CF6-80C2s and -80E1s respectively, while its A340s, A320s and 737-300/400s have various versions of the CFM56. LTP's engine unit has a "tear-down" capability for CFM56-3s, -5Bs and-5Cs, as well as CF6-80C2s and -80E1s.
One of LHT's other Asian maintenance ventures - Ameco in Beijing, set up with partner Air China - specialises in Boeing aircraft types and Pratt & Whitney and Rolls-Royce engines.
LTP has faced criticism that the formation of the joint venture has significantly increased PAL's maintenance costs. But Janke says there are three main reasons why this has occurred, and none are related to LTP directly. Specifically, PAL's fleet has increased in size; the CF6-80E1s powering its A330s have been the subject of FAA airworthiness directives and service bulletins; and three maintenance-intensive 747-200s were temporarily introduced to the fleet as back-up aircraft.
PAL president and chief operating officer Avelino Zapanta says the carrier is seeking compensation for the problems afflicting its A330 engines, most of which had to be taken off wing after only about 2,000 cycles. The airline claims the problems cost it $30-40 million to rectify. "GE is coming to discuss these matters because we feel GE has to somehow help us in this deficiency," says Zapanta.
Source: Flight International