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Air Berlin considers MRO restructuring

Air Berlin is evaluating whether to merge its two base maintenance facilities in Dusseldorf and Munich, and whether it might need to move standard heavy airframe checks outside of Germany in future.

The airline says it is committed to improving productivity at its maintenance, repair and overhaul (MRO) subsidiary Air Berlin Technik. But it is not yet clear whether the division will continue to provide a broad range of airframe services such as modifications and cabin upgrades - which warrants staying near the parent's operational base in Germany - or whether base maintenance will be limited to regular C-checks, which bolsters the case for relocating.

Tobias Hundhausen, senior vice-president production and accountable manager at Air Berlin Technik, tells Flightglobal that the carrier wants to decide by year end whether to combine its base maintenance operations in Dusseldorf and Munich in the medium term.

"The more [production] lines are located in one facility, the more flexibility we gain," he says. "But the challenge is how to overcome the [current] know-how separation, with the Boeing 737s being serviced in Munich and the Airbus types in Dusseldorf."

The airline's future base maintenance strategy is expected to be finalised around the middle of next year. This should clarify whether Air Berlin Technik will continue to provide a wide range of airframe support services.

Hundhausen says that the proximity to the parent's operations as well as the ability to employ hangar capacity and technical capabilities flexibly justifies base maintenance in Germany. But if Air Berlin's requirements were to change to standard C-checks only, the company would consider moving work to lower cost locations, such as east Europe.

This would not necessarily mean outsourcing the work to a local MRO provider, but it could lead to setting up an owned facility in an appropriate location. "With around 150 aircraft, we could occupy about three production lines. Given such fleet size, I am not sure whether outsourcing [to an external service provider] will really be more economic," Hundhausen says.

He stresses that changing agreed fleet maintenance schedules with external MRO providers on short notice can incur penalty payments, which can invalidate an original cost advantage and thus favour in-house operations.

Hundhausen concedes that productivity needs to be "significantly" improved at the existing sites. But he adds that "offshoring and outsourcing are only options thus far, which we would consider if our locations in Germany cannot be run profitably anymore. At the moment, we are on a good course for our sites to be able to offer our main customer Air Berlin an individually tailored service package."

He says that the current focus is to improve productivity and that turnaround time has already been cut "significantly" over the last months.

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