Andrew Doyle/MUNICH

MTU Aero Engines is bidding for a major slice of the rapidly expanding South American engine maintenance market with the establishment of a wholly-owned overhaul facility in, Saø Paulo, Brazil.

TAMof Brazil has signed up as MTU Maintenance do Brasil's first customer with a deal to repair and overhaul the International Aero Engines V2500s powering thecarrier's 38 Airbus A319/A320s. MTU manufactures the V2500's low-pressure turbine.

The German company will also maintain the Rolls-Royce Tay 650-15 turbofans installed on TAM's 51 Fokker 100s. MTUvalues the two 15-year contracts at c665 million ($570 million), but says this figure could grow to more than c1 billion if TAMexercises options on another 18 Airbuses.

The deal is a blow to Sao Paulo-based rival Motores Rolls-Royce. The company lost the V2500 contest to MTU and in addition saw its Tay work go the same way.

MTU anticipates annual sales of c100 million for the Brazilian unit once established, and will target other operators of the V2500 inthe region, including Columbia's ACES, Costa Rican carrier Lacsa, LanChile, Mexicana and TACAof El Salvador.

"For us, Central and South America are a high-growth market for engines and aerospace generally," says MTU president and chief executive Dr Klaus Steffens. "That's the business our newfacility is after."

MTU already has a base in North America after the establishment of MTU Maintenance Canada in 1998, and in May, MTU Maintenance Zhuhai was founded in China.o

Source: Flight International