AAR is at Asian Aerospace in bullish mood about the airline industry and with plans for major expansion in Asia-Pacific. It is talking to two airlines in the region about outsourcing maintenance but does not expect to sign deals during the show.
"We are going after two more airlines offering them total support," says Joe Gullion, vice-president and chief operating officer of AAR.
The value of the aerospace aftermarket sector dropped after 11 September from $107 billion a year to $88 billion, but Gullion says the signs of recovery are well established and the sector should return to the pre-September figure by 2007.
Recession
The United States will lead the world out of recession this year, with major growth expected in Asia-Pacific.
It's in this region that AAR is planning much of its growth. Gullion wants to see the level of AAR's business in the region, currently 5-7%, grow to 25% as the $700 million plus company grows to $1 billion within three years and $1.3 billion over five years.
Gullion says that AAR has positioned itself to take advantage of trends in the airline industry, principally towards low cost carriers.
His analysis sees the growth of low-cost carriers worldwide rising from around 7% to 35-50%.
"How do they take cost out of the equation? Outsourcing is clearly part of the answer and that is our business. We are ready to partner with them," he said.
"There is an accelerating trend towards outsourcing."
Source: Flight Daily News
