Tuesday July 10, 2012
AIROD signs RM50mil agreement with US firm
By SHARIDAN M. ALI
PETALING JAYA: AIROD Sdn Bhd, the country's leading aircraft maintenance, repair and overhaul (MRO) company, has inked an agreement with US-based AAR Airlift Group Inc to provide repair, overhaul and support services for latter GE CT58-140-2 engines and associated accessories at estimated contract value of RM50mil.
The contract is in line with AIROD's aspirations to grow its civil or commercial aircraft MRO business where currently the bulk of Airod revenue of about 70% comes from military MRO services.
The initial tenure of the contract is three years with an option to extend to five years. An estimated total of 58 engines are expected to be input into AIROD with the first engines input to be as early as August.
AIROD chief executive officer Datuk Kamil Aziz said the estimated contract value would also depend very much on flying time and condition of the engines that would determine their need to be serviced.
“There are scheduled overhaul services and unscheduled repair and maintenance services of the engines as well. And the contract with AAR Airlift is largest contract for civil engine overhaul division,” he told reporters after the signing ceremony with AAR Airlift yesterday.
Kamil said AIROD had extensive experience in the MRO of this type of engine as similar engines were fitted on S61-A4 Nuri helicopters operated by the Royal Malaysian Airforce (RMA).
“Furthermore, our expertise to service this kind engine has received certification from Federal Aviation Administration of the US.
“The Malaysian Government, Ministry of Defence and the RMA in particular have always been most supportive of AIROD in the acquisition and development of capabilities including that for CT58 engines,” he said.
He said the tie-up with AAR Airlift was the most significant and in line with its strategic plan to capture a larger portion of the commercial sector business in the aviation industry. “Our focus on civil aircraft MRO now is in order to withstand the declining military spending worldwide, including Malaysia.
“Thus, we are expanding our capabilities in this segments and also negotiating more jobs with several big aviation companies in the region,” he said, and added that while it was expanding its international business (both civil and military) at its base in Subang, AIROD was also moving some its local military MRO jobs to Royal Malaysian Airforce bases.
“We are working together with RMA on this,” he said.
Meanwhile, AAR Airlift chief operating officer Jeffrey Wehrenberg said their company chose AIROD primarily due to its reputation in delivering quality services.
as well as both companies had managed to come to agreement on the economic terms.
“We have about 20 helicopters and their engines are going to be serviced here.
“Our helicopters sometimes fly to very dangerous places and any engine problem would be unthinkable,” he said.