Gulf Air in creation of new MRO venture

Bahrain-based airline signs five year MRO deal with SR Technics and takes 10% stake in new Muscat maintenance centre.

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By  David Ingham Published  April 11, 2006

Gulf Air has parted company with GAMCO and appointed SR Technics as its new maintenance, repair and operation (MRO) provider. A five year contract worth around US $750 million has been signed with the Swiss company. As part of the deal, SR Technics and Gulf Air will build a new aircraft maintenance facility and training centre in Oman. “After fuel, maintenance is our second highest operating cost,” said James Hogan, president and CEO of Gulf Air. “In the first step to address this, we concluded a rotables maintenance agreement with Lufthansa Technik at the end of 2004. "Building on the savings achieved, this agreement with SR Technics is expected to result in further savings of about US $190 million or 24% over the five year period, while delivering world-class maintenance services.” SR Technics will provide fleet management services for Gulf Air’s fleet of ten A320, six A330, nine A340 and nine B767-300 aircraft remotely from Switzerland. Maintenance and repair services will be provided primarily through the new facility in Oman. The centre, in which Gulf Air will hold a 10% stake, will provide a swathe of maintenance, training and component services to both Gulf Air and other third party customers. US $50 million will be invested in the creation of the maintenance facility and around 850 jobs are expected to be created in its first five years of operation. “The signing of this MOU is a first step for SR Technics in establishing a physical presence in the Middle East, which we see as a key growth region in the aviation services sector,” said Frank Turner, chairman, SR Technics. “Our repeated success over the past year, and this decision by Gulf Air indicates that we have the right proposition, flexible enough to be tailored to each customer’s requirements.”

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