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Desert bloom

Etihad Airways Engineering has been steadily expanding its technical capabilities and its customer base, making it an increasingly important player in the international MRO Market. Ian Harbison reports from Abu Dhabi

In 2014, Etihad Airways acquired Abu Dhabi Aircraft Technologies (ADAT) from the Abu Dhabi national investment company Mubadala, turning it into Etihad Airways Engineering.


Abdul Khaliq Saeed, previously Chief Executive Officer of ADAT and currently in the process of transferring as Chief Executive Officer of Mubadala-owned Turbine Services & Solutions (TS&S) to Chief Executive Officer of Etihad Airways Engineering, explains that an MRO facility was really outside the scope of the investment company, while the airline needed to take control of these capabilities to ensure efficiency and flexibility, especially as it had a rapidly expanding fleet. In addition, substantial resources would have to be developed to include new generation aircraft such as the Airbus A350 and Boeing 787. However, engine work was deemed to benon-core to the MRO and so was handed over to TS&S).


Frederic Dupont, Vice President Technical Sales and Customer Service, comments that it took some time to integrate the two companies, without outside consultants being hired to assist with the process.


Saeed says the company now has a focus on growth, most especially in the well-established third party business that ADAT enjoyed previously – the parent fleet represents only 40% of throughput. Advantages include a convenient location between Europe and Asia, good technical skills, fast turnaround times and a labour cost advantage. However, he feels that the takeover has now introduced airline experience to the business, making it more attractive to operators and generating additional work as a result. In addition, the Etihad brand carries considerable weight, and Dupont points out that national flag carriers  which are customers include Korean Air, Lufthansa, Philippine Airlines, Qantas and Singapore Airlines.


In fact, the customer portfolio is quite diverse, including Aeroméxico, Air Tahiti Nui, Avianca, Brussels Airlines, Kenya Airways and LATAM.


There is some seasonality, with the summer months being quiet, but this will be compensated for by freighter aircraft (which have a counter cycle), end of lease returns and cabin work.


Of course, end of lease work also requires repaint and, in 2015, Hangar 5 was converted into a paint hangar. It has additional chillers installed for enhanced air conditioning and temperature control, improved thermal insulation, and an efficient drainage system to suit stripping and painting requirements. The hangar has also been equipped with an aircraft docking system which can be customised to serve different types of aircraft. The company was the first MRO to completely strip and repaint a Boeing 787.


One question mark at present is the future Etihad fleet plan. The airline acquired a number of equity partners, with the idea of rationalising aircraft, routes, marketing and processes. While Air Serbia, Air Seychelles, Jet Airways and Virgin Australia have been successful, the investments in airberlin and Alitalia are under a cloud. However, delivery deferrals to slow down expansion rather than order cancellations are likely to be the order of the day. The plan is to have 175 aircraft in 2025, up from the current 135 aircraft, and will include the Airbus A350 (45 A350-900 and 22 A350-1000 on order) and Boeing 777X (25 on order).


For the remaining equity partners, there are still plans for close cooperation and, on the MRO side, IT investment has seen AMOS from Swiss AviationSoftware and Secure Technical Records for Electronic Asset Management (STREAM) from AerData. There is now work going on to introduce these across all the fleets.


As noted above, ADAT had established a good reputation. Etihad Airways Engineering has built on this and proved itself with Airbus when it became an important part of the A380 leading edge wing rib replacement programme, which started just prior to the takeover. This was based on engineering skills and quality, and saw aircraft from several operators being directed by the OEM to Abu Dhabi for rectification work, despite the length of some of the ferry flights. Saeed saysthe company turned out to be the best performer of the selected MROs for the work, with every aircraft delivered on time and with no defects. Customer satisfaction has resulted in other business being directed to Abu Dhabi.


In November last year, the link to Airbus was strengthened with the signing of an MoU to work jointly on the development of new A380 MRO services in Abu Dhabi. These are aimed at offload work from operators who have their own maintenance facilities and upgrade programmes. At the time of the announcement, the company had just delivered Etihad Airways’first A380 heavy maintenance C check, along with an extensive cabin refresh ahead of schedule. The agreement also involves Airbus subsidiary, Satair Group, which is providing inventory management services to supply all the necessary consumable and expendable parts.


The company clearly sees inventory management as a non-core business. In June 2016, it signed a multi-year agreement with Aviall for consumables and expendables aircraft parts supply, including forecasting, planning, advanced provisioning and supply chain administration, and covering Boeing proprietary and Aviall-sourced parts used on Airbus and Boeing commercial aircraft. A month later, an MoU was signed with DHL Supply Chain which will begin introducing process improvements and implement new supply chain systems within the initial phase of the contract. The contract had not been signed at the time of writing, but would see stores management, local transport movements and associated supply chain planning being transferred to DHL (see MRO Management, September 2017).


Also in June, the company became one of the founding members of the Airbus MRO Alliance (AMA), which has been established to grow the OEM’s services worldwide and will address the increasing demand that is forecast for the next 20 years. The other members are AAR, Aeroman, China Airlines, GAMECO and Sabena technics. >>


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