Air Canada has signed a five-year contract with General Electric for maintenance on the GE CF34-8E engines that power its fleet of Embraer 175 aircraft.
The contract provides a firm fixed price on the time and materials incurred for the engine work. This type of agreement allows operators to better predict maintenance costs, says Paul McElhinney, president of GE Aviation's services operation.
"GE is pleased Air Canada has signed an OnPoint solution agreement with our improved firm fixed price structure," says McElhinney. "The firm fixed price is designed to make shop visit cost more predictable and affordable to operators."
Air Canada is focused on bringing costs down with more competitive pricing on maintenance contracts struck with suppliers after Aveos Fleet Performance filed for bankruptcy protection and unexpectedly shut its doors in March 2012. The carrier said earlier this month that it plans to see C$143 million ($140 million) in yearly benefits from new rates on maintenance agreements with other more cost-competitive MRO firms.
To further reduce costs, Air Canada is in the process of moving 15 E-175 aircraft operated in its mainline fleet to Sky Regional.
Terms of the agreement were not disclosed.
Source: Flight Daily News
