Turkish Technic eyes global markets
The maintenance arm of Turkish Airlines is developing a new US $200 million facility in a bid to expand its third party business.
Turkish Technic is making a bid to become a global player in the MRO business. The maintenance arm of Turkish Airlines is currently developing a new US $200 million facility, and has spoken with various international MROs and OEMs about potential partnerships and alliances.
“We are shifting our mentality from being just part of an airline to being a fully-fledged MRO,” said Dr Ismail Demir, executive vice president, technical, Turkish Airlines.
Turkish Technic’s broad objective is to generate US $500 million in MRO business by 2010. To help it achieve this goal, the company has began work on the new Habom MRO facility at Istanbul’s Sabiha Gokcen International Airport.
The centre is being set up to provide heavy maintenance services for narrow and widebody aircraft, as well as engine and component maintenance. It will feature aircraft maintenance hangars, engine facilities and component workshops.
In addition to serving Turkish Airlines, Turkish Technic will be targeting customers in the 55 countries that lay within a three-hour flight distance from Habom. According to Demir, a wide range of capabilities and skilled labour are his company’s competitive edges.
“In the Gulf region, the local workforce is not that strong,” he said. “In Turkey, most of our technicians are graduates with five years of university education. That makes it a very skilled and knowledgeable workforce.”
Talks are currently on with various international MROs with a view to finding a third party prepared to take a 50% share in Habom. Finding such a partner would be a plus for Turkish Technic, because of the expertise, market reach and cash that a global MRO could bring to the table.
Demir insists, however, that a deal must be on the right terms and that failure to find an international partner will not derail his company’s plans. “A partner will create synergy, it is a win-win case whoever joins,” he said.
“But the terms of business should be understood very well. Our objective is to have a partnership with someone who is ready to share the burden in terms of financial cost and take risks with us, not someone who will just see a 300-aircraft market in Turkey. We want to be a global player.”
Another issue that needs to be addressed is that of OEM accreditation. Most MROs tend to specialise in certain aircraft or engine types and focus considerable investment in gaining official accreditation from the manufacturer.
Demir said that Turkish Technic will have to choose these partnerships carefully. “OEM relationships are crucial, because once you have agreements, it is not very easy to shift them,” he said. “There will be a cost element involved.” If a deal is struck with an MRO, this would inevitably influence Turkish Technic’s choice of OEM partners.
For Arab airlines, which operate a sizeable number of narrowbodies, Demir feels Turkish Technic’s expertise with the 737 and A320 could make the MRO an attractive partner. “We see ourselves as competitive in narrowbodies first and foremost,” he said. “We have expertise in 737s and are increasing our expertise in A320s.”