Why airline operators, experts push for local aircraft repair facilities

In recent times, there has been a focus on the strategic importance of Maintenance, Repair and Overhaul (MRO) to aviation business. 

It is an incontrovertible evidence that a successful airline business is hinged on the existence of local MRO, which would save airlines billions of dollars in revenue annually. 

At a time sourcing for dollars has become a hard nut to crack, coupled with skyrocketing prices, airlines have continued to run at a loss, making their money in naira and ending up converting everything to dollars to fulfill financial obligations with the MRO. 

To underscore the importance of MRO, the federal government, in its aviation roadmap, listed MRO as one of the projects to be implemented.

But stakeholders in the industry say the MRO, which is far better than other projects, would have been a game changer for airlines bogged down by skyrocketing dollars and pressure to source for dollars to conduct scheduled checks on their aircraft. 

Speaking with our correspondent, the vice president of Airline Operators of Nigeria (AON), Mr Allen Onyema, said Nigerian airlines were being exposed to racketeers and scammers in a bid to source dollars to carry out scheduled maintenance. In addition, many airlines have had their aircraft seized on account of not being able to pay for services rendered by MRO firms in Europe or America. 

A recent report indicated that global aviation (MRO) logistics market size is estimated to reach $13.1billion by 2027.

Nigeria was said to have spent about N1.25 trillion in 2021 on MRO activities in countries like Ethiopia, Morocco, Egypt, United Arab Emirates, South Africa and others with advanced maintenance facilities, according to the managing director of the Federal Airports Authority of Nigeria (FAAN), Captain Rabiu Yadudu, in a recent statement. 

This is why stakeholders say that any roadmap without an MRO that would facilitate airline business would be an exercise in futility. 

Daily Trust on Sunday reports that MRO is a major component of the aviation roadmap of the federal government, and like other projects under the roadmap, there is uncertainty over the status of the project.

In January 2021, the federal government unveiled preferred bidders who emerged for MRO centre and Aviation Leasing Company.

The Consortium of A J Walters Leasing Limited and Glovesly Pro-Project Limited emerged as the preferred bidders for the ALC, while the Consortium of A J Walters Aviation Limited, Egypt Air Maintenance & Engineering (EGME), and Glovesly Pro-Project Limited emerged as the preferred bidder to establish the MRO centre.

This followed the evaluation of the proposals submitted by bidders in response to the request for proposals for the Aviation Leasing Company (ALC) and the MRO centre by the Federal Ministry of Aviation.

While the government vowed that it would fulfill its promise to deliver the projects under the MRO, the delay is causing unease and doubt among the operators. 

Veteran aviator, Captain Oladele Ore,said that having an MRO was more important than a national carrier. 

Ore, who is the founder, Aviation Round Table (ART), now christened Aviation Safety Round Table Initiative, (ASRTI) said, “This is also necessary now because those representing the government failed to give attention to that critical element for a successful airline business.

“It is a big shame that those in charge have since been content with flying aircraft to Europe or the US for maintenance. Those with oversight of aviation ought to have shown interest in how and where maintenance is done. And this is another major reason for losses. Flying aircraft out for maintenance keeps your profit graph on the floor.

“What you can do in a local maintenance base, either in Port Harcourt, Orom, Abuja, Lagos, Enugu, or anywhere else within the country, we refused to provide.

“For me, rather than establish an airline, the priority should have been a maintenance facility.

“At this stage in the history of aviation in Nigeria, we ought to have attained mastery in various aspects of maintenance with the different hangars laying claim to expertise in one or two aspects of aircraft maintenance.”

Daily Trust on Sunday, however, reports that Ibom Air is currently building an MRO in its hub in Akwa Ibom, which is about 85 per cent completed. Similarly, Aero Contractors has a hangar at the Murtala Muhammed Airport General Aviation Terminal in Lagos, while 7-Star Global Hangar is also involved in MRO activities and successfully completed a C-Check on the MD83 aircraft belonging to Dana Airlines. 

The collaboration and the success of both companies led to the release of the certificate of airworthiness by the Nigerian Civil Aviation Authority (NCAA).

The Director of Business Development/Corporate Affairs of the firm, Sani Ahmadu, stated that 7-Star Global Hangar was committed to providing responsible, professional and premium quality aircraft maintenance services.

However, Ore said the government must team up with the indigenous companies already doing MRO to increase capacity and explore ways of meeting local demands to stop the financial demurrage on Nigeria.

According to him, there can be an MRO hangar “with mastery in fixing challenges bordering on wheels or brakes. And those with that challenge go nowhere else.”

He said there could be another MRO with specialisation in mainframe, another renowned for engine repairs would each attract clients to benefit from a comparative advantage in quality service and in cost that will reflect the economy of scales. 

MROs with known different specialisations will inspire healthy competition. This is good for the real growth and development of the aviation industry in Nigeria.

He added, “The acquisition of Ibom Air will be the game changer and will also hasten the actualisation of the people’s desire for a national carrier. Such a move, no doubt, will be a master stroke, game changer and a perfect fit.”

A former rector of the Nigerian College of Aviation Technology (NCAT), Zaria, Captain Samuel Caulcrick, has called for a policy to encourage the set-up of MRO facilities.

Caulcrick said there must be an enabling environment for investors into the MRO project.

To achieve this, he said, “For instance, the NCAA can say it would not renew an existing AOC or issue an AOC to an intending operator without a local MRO identified in the application form. The government can give them a timeline because this could take up to three years to accomplish.

“Now, if we take the MRO business to foreign countries, it means we are creating business for those countries when we were the one that created the business. So, it is better to let it stay within the economy. That is one argument by which the MRO supports the economy. So, this economy should not lose to other economies after creating that business.

“Also, MRO supports the naira in the pockets of all of us. Once the aircraft is taken out, there is the cost of labour that would be paid by the airline.”