New Delhi, Sep 4 (IANS) Air India's maintenance repair and overhaul (MRO) facility in Nagpur will be completed by the year-end and will become operational by the second quarter of calender year 2013, Global aircraft manufacturer Boeing said Tuesday.
"The construction work at the facility will be completed by December (2012). After that, equipment and machinery will be installed. The MRO will become operational by the second quarter of calender year 2013 subject to DGCA (Directorate General of Civil Aviation) clearance," Dinesh Keskar, senior vice president, sales, Asia Pacific and India, Boeing Commercial Aircraft, told IANS.
The MRO is part of an agreement between the national carrier and Boeing following an order for 737s and 787s Dreamline which were placed by Air India in January 2006. Apart from Air India's aircraft, the MRO will offer services to other carriers which are operating Boeing planes as well.
"The MRO is coming up at a total cost of $100 million. The MRO will be handed over to Air India once it's completed," Keskar said.
The MRO facility, spread over 50 acres next to the Nagpur airport, will have two hangars. It would offer maintenance and overhauling services to 300 aircraft a year. Both the hangars will have capacity to house three 737 aircraft each or one 777s or 747 each.
According to an Air India official, the MRO will form a part of a separate profit-making subsidiary of the airline which has been envisaged in the turnaround and financial restructure plan of the airline.
"The new MRO will help us cut cost but more importantly assist us in our other plans for the MRO sector. We will transfer nearly 7,000 employees to our upcoming regional MRO facility for third-party work for generating extra revenues," the official told IANS.
The airline said the proposal will help maintain a higher margin on its third party MRO work.
"Till February 2012 we had generated a total revenue of around Rs.14.3 crore in the northern region alone. This margin will increase with the new MRO facility."
According to a civil aviation ministry report, the Indian MRO industry is expected to triple in size from Rs.2,250 crore ($440 million) in 2010 to Rs.7,000 crore ($1,369 million) by 2020.
However, this is quite small when compared to present size of per annum MRO business in the UAE ($1,565 million) and China ($1,956 million).