SIA Engineering Company (SIAEC) has emerged as the big beneficiary of Gulf Air's decision to terminate its major MRO contract with SR Technics.

The Singapore Airlines subsidiary has won a three-year fleet management programme (FMP) from the the Bahrain airline which it values at more than $100 million, and is in addition to a smaller $21 million heavy maintenance deal agreed last year.

A key element of the arrangement is that SIAEC will help Gulf Air build its in-house MRO capabilities towards self-sufficiency.

Gulf Air stunned SR Technics by giving the UAE-controlled company six months notice in January, leading to SR Technics taking a rapid decision to close its Dublin operations with the loss of some 1,100 jobs.

SIAEC says: "Under the FMP contract that will commence in June 2009, SIAEC will provide Gulf Air with a wide range of FMP services, including A- and C-checks, fleet technical management, material management and engineering services, which will be performed in Bahrain and Singapore."

It covers 29 current Airbus aircraft in the fleet and the 35 that the airline has on order. The airline's ordered Boeing 787s, are not mentioned in the announcement, although SIA is also a customer for the type.

Gulf Air chairman Talal Al Zain says in a statement: "As the national carrier of the Kingdom of Bahrain, Gulf Air's strategy is aligned with the Kingdom's 'Vision 2030' and this announcement is an important step in ensuring that we can continue to support that vision.

"We believe [SIAEC] are the right choice to help us boost our operational reliability, manage costs, and establish a self-sufficient and robust aircraft maintenance system."

The company adds: "Under the terms of the three-year contract, provision has been made for SIAEC to work with Gulf Air to insource the MRO services provided by SIAEC."

Vision 2030 is an ambitious economic development plan for Bahrain announced last October which aims to double the disposable income of every household in the nation in large part by the creation of skilled employment in an expanded private sector.

Source: Air Transport Intelligence news