Thursday, March 17, 2011

Airlines blame tax hurdles for slow MRO biz takeoff

Mumbai: Airlines in India outsource at least $700 million worth maintainence, repair and overhaul work to companies abroad annually and there is a great need to develop such infrastructure in India, experts said at the inauguration of the MRO India 2011 conference in Mumbai today.

For airlines, especially low-cost carriers, which depend upon maximum utilisation of each aircraft — up to 14 hours a day in the air — to keep the profits coming, grounding of aircraft due to maintenence repairs amount to additional avoidable expenses. And when they send their aircraft abroad for maintainence and repair, they end up losing valuable days in ferrying the aircraft abroad and during customs clearance.

“Five to ten years ago, there were close to 8-10 MROs keen in setting up business in India, but most of them have backed out. Today there are only a handful,? said Babu Peters, executive vice president, engineering, GoAir, who gave a talk on the “present state of MRO in India and the wish list from operators” at the conference on Wednesday. This is partly because the development of the MRO (maintainence, repair and overhaul) industry in India has been hindered because of the differential taxation structure, those in the MRO industry said.
17/03/11 Indian Express
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