Air France-KLM to set up plane parts repair facility in India

The aeronautical division of Europe’s largest airline, Air France-KLM group, has entered India’s aircraft component repair market by acquiring a 26% stake in Mumbai-based aircraft maintenance, repair and overhaul (MRO) company Max AeroSpace and Aviation Ltd for an undisclosed amount.
A formal announcement is expected on Wednesday.
Air France Industries, KLM Engineering and Maintenance and Max AeroSpace will jointly build an aircraft component repair facility at a special economic zone (SEZ) that will be capable of servicing Boeing Co. and Airbus SAS planes, their executives said.
Mid-sized planes made by Boeing of the US and Europe’s Airbus dominate the Indian market.
As India’s aviation sector grows, the domestic MRO market is expected to earn a revenue of $1.06 billion (Rs.4,781 crore) by 2015, up from $499 million in 2009, according to a 2009 report by Frost and Sullivan. MRO service requirements in the country are expected to grow annually at a compounded rate of 13.5% in the same period.
“Labour costs in India are around $30-35 per man-hour, compared to $55-60 in South-East Asia and the Middle East and even higher in the US and Europe,” said Frost and Sullivan analysts Chethan Kambi and Arun Narayanan. “Therefore, India has the potential to service not just Indian aircraft but also those from neighbouring regions.”
Bharat H. Malkani, chairman and managing director of Max AeroSpace, said his company will start building the MRO facility in the first quarter of calendar year 2011. The facilitiy is expected to be ready by mid-2013.
17/11/10 P.R. Sanjai/Live Mint

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Categories: Foreign Nov 2010, Indian Aviation- In General Nov 2010, New Nov 2010