How to
overcome the challenge, by experts
• ‘Why
progress on MRO initiative in A’Ibom is slow’
The absence
of a functional maintenance and repair facility in the country at least in the
last 17 years accounts for N22.3 billion local airlines spend yearly repairing
their
planes overseas.
The
mandatory maintenance programme, ranging from minor to complex checks per
session on an aircraft, could cost over $1 million (N305 million), which is a
huge spending by already struggling local airlines with multiple planes in
their fleets.
And due to
the huge financial burden, a total of 73 commercial aircraft operated by eight
airlines have lately reduced to 48 serviceable planes. Whereas the financial
burden is avoidable by stakeholders’ estimates, overseas repairs continue to
drain the lean purse of local operators lowering their capacity, revenue and
chances of survival.
Specifically,
a maintenance facility, otherwise known as Maintenance, Repair and Overhaul
(MRO) organisation, is an essential requirement in civil aviation to ensure
that aircraft are maintained for airworthiness to safely transport passengers
and cargoes.
Aircraft
maintenance checks are periodic inspections that have to be done on all
commercial/civil planes after a certain amount of time or usage. Checks range
from A to D. A and B checks are minor routine checks that a team of engineers
carry out at an airline’s hanger. C and D checks are more complex demanding
expertise top-range facility. A C-check is mandatory every 18 months, according
to Nigerian civil aviation regulations. It requires the inspection of the
majority of an aircraft’s components, some of which may be replaced, during a
maintenance programme lasting about two weeks. D-check is the complete overhaul
of an aircraft that may be done every six years.
Some local
airlines currently do A and some part of B checks locally. They all fly the
aircraft to Europe or a few African countries for C-check that has been
described as the most burdensome on the overhead of airlines.
The average
cost of a C-check is $1 million (N305 million) or more depending on a number of
components that need replacement during the repair. This, therefore, explains
why aircraft maintenance alone costs between 15 and 30 per cent of operating
cost of most airlines.
The Guardian
learnt that back in the days of the Nigerian Airways, a national carrier owned
and operated by the Federal Government until 2003, all the checks were done
locally.
A member of
the engineering team, Ayuba Kyari, recalled that the Lagos hangar conducted
C-checks on Boeing 737 aircraft type and D-check on Airbus A310 in the fleet of
30 aircraft paraded by the defunct airline. The MRO facility was liquidated
with the airline in 2004.
Today, all
local airlines in commercial operations fly to France, Germany, Lithuania,
South Africa, Kenya and Ethiopia, among others, to do C-checks. Arik Air, for
instance, currently patronises a MRO facility in Lithuania, a country of 2.8 million
population.
Currently,
eight airlines operate in the local airspace in Nigeria with at least 73
aircraft. Air Peace has 13 aircraft, Arik Air has the largest fleet size of 28
(12 now serviceable), Aero Contractors has 10, with two currently in use, First
Nation has two, with one in operation while Azman Air and Med-View have four
apiece. Dana Air has five and Overland Airways has seven airplanes. In total,
the airlines spend N22.3 billion on C-checks alone in every 18 month.
For reasons
not unconnected with the huge cost of maintenance, only 48 out of the 73 planes
are in operations. The Guardian learnt that the inability of two domestic
carriers to pay the bills has left some of their aircraft stranded overseas.
Both private
and public efforts to revive the essential facility in Nigeria lately have not
yielded the desired result. The Akwa Ibom State government, about a year ago,
completed its state-of-the-art MRO complex with the hope that both local and
foreign investors would be attracted to complement it with more
capital-intensive equipment and expertise. None has shown up till date and the
hangar lies fallow, The Guardian gathered.
Capt. Dung
Rwang Pam observed that the then MRO of the Nigerian Airways was a 1977
initiative of the Federal Government to cater for the burgeoning aviation
industry.
Pam said it
was quite unfortunate that 40 years later, despite “bogus contracts in millions
of dollars, the facility has not been duplicated; none is on ground today.
Spirited efforts by private individuals, corporations and state governments
have elicited no support from the Federal Government,” he said.
The Managing
Director of the Nigerian Airspace Management Agency (NAMA), Capt. Fola
Akinkuotu, was recently of the view that MROs are stand-alone businesses and
often independent of airlines around the world.
Akinkuotu
said the onus was therefore on the public and private sectors to invest in the
profit-making venture for a win-win regime for the investors, airlines and the
economy.
To the NAMA
boss, who is a former managing director of Aero Contractors, the local MRO is a
must for a vibrant, competitive aviation industry, yet not beyond the country.
He was of
the view that Nigeria could have a functional MRO at the cost of $37 million
(N11.3billion), which is less than what all the airlines are spending on
C-checks every 18 months.
He said
given the readily available market in Nigeria and West African region, a loan
of $37 at about nine per cent interest rate is payable in less than 10 years.
Should the facility make $6.7milion (N2billion) a year, it would have
$60.3million (N18.4billion) in just nine years of operations.
Nigeria is
indeed not alone in the critical infrastructure deficit. None of the West
African countries has a MRO, conceding the MRO hubs to Johannesburg, Nairobi
and Addis Ababa, Ethiopia – all of which have national carriers that are
dependent on Nigerian market for traffic.
The dominant
MRO players on the continent can be divided into African and non-African. Local
MRO providers include South African Airways Technical (SAAT), Ethiopian
Airlines Maintenance and Engineering, Kenya Airways Technical and the Air
Algerie Technics and Tunisair Technics.
Non-African
operators include Air France Industries KLM Engineering & Maintenance (AFI
KLM E&M), Direct Maintenance and Sabena Technics. There are also joint
ventures such as Air France Industries and Royal Air Maroc’s Aerotechnic
Industries.
Experts are
unanimous that the MRO market is fast enlarging, though with it too is the
politics.
Aviation
Week’s MRO Forecast estimates that airlines in Africa spent about $2.5 billion
on MRO in 2016. The spending is expected to be more with the influx of new
aircraft. In other words, the MRO market is fast expanding.
Acting CEO
of South African Airways and CEO of SAA Technical, Musa Zwane, put the current
number of airliners in Africa at roughly 1,300, with approximately 1,000 new
aircraft deliveries due over the next 20 years.
The politics
is that engine and component services are still dominated by the original
equipment manufacturers (OEM), which are fast becoming bigger threat to MROs as
they enter the aftermarket with total care and support packages.
Zwane,
however, believes partnerships would solve many of Africa’s MRO problems.
“Joint ventures and collaborations would certainly provide this continent with
the much-needed economies of scale. Partnering through aviation can lead to
economic growth for this entire continent. Now is the time for African aviation
to take the lead in propelling this region as an emerging economy,” he said.
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