Andrew Mollet
Rolls-Royce has signed a memorandum of understanding (MoU) with Singapore Airlines subsidiary Singapore Airlines Engineering (SIAEC) and Hong Kong Aero Engine Services (HAESL) to establish a new joint venture to undertake Trent engine overhaul and maintenance in Asia-Pacific.
The announcement was made by Rolls-Royce chairman Sir Ralph Robins at the show.
SIAEC will hold a 50% stake in the new venture, Rolls-Royce 30%, and HAESL 20%.
HAESL - itself a joint venture between Rolls-Royce and Hong Kong Aircraft Engineering (HAECO) - is currently the only company able to handle Trent overhaul in the region, where seven airlines have already ordered more than 300 Trent engines for Boeing 777 and Airbus A330/340 aircraft.
HAESL's customer base includes Cathay Pacific's RB211 and Trent-powered fleets.
The new company will initially undertake repair and overhaul for the Trent 800s powering Singapore Airlines' fleet of up to 61 B777s.
Rolls-Royce has also signed a letter of intent with American Airlines to set up a similar base in Fort Worth, Texas later this year to cover North, South, and Central America and the Caribbean.
That new company, as yet unnamed, will service American's large fleet of RB211-535 powered Boeing 757s and Tay-powered Fokker 100s, and later the Trent 800s on its fleet of 777s..
Robins says these new joint ventures are an integral part of Rolls-Royce's strategy to double the size of the company's overhaul business over the next five years. The company already controls around 50% of the global Rolls-Royce engine overhaul and repair market.
It also forms part of a philosophy based on having a wide range of products, which allows the company to address strategic markets across the globe.
Powers
These include not only the Trent series of engines, but also the BMW Rolls-Royce BR715 which powers the new Boeing 717 and the Allison AE3007, which powers both the Embraer RJ-135 and RJ-145.
In the military field, Rolls-Royce is involved in both the Eurofighter and the Joint Strike Fighter projects, as well as the EH Industries EH101 and Boeing Westland WAH-64 Apache helicopter programmes.
"Basically, the commercial and military applications are nicely balanced that the moment," says Robins.
He also says it is unlikely, but not inconceivable, that Rolls-Royce would acquire any more engine manufacturers such as the USA's Allison, which the company acquired three years ago.
"That has been an almost perfect match; Allison brought with it a great portfolio of products and markets.
"It has given us a base now so broad that it's difficult to see another opportunity like that coming up again. But we are not ruling anything out."
Rolls-Royce chief executive John Rose, meanwhile, stresses the importance of the Asia-Pacific region as a market for Rolls-Royce: "We have to take a long-term view of the market and we anticipate it will be worth $420 billion over the next 20 years.
"Within that, Asia Pacific will be the fastest-growing region.
"In the near term we may see a slow-down of the rate of growth- but the North American and European markets continue to show surprisingly strong demand.
"In fact, nearly 90% of new engine orders we took in 1997 came from Europe and the Americas."
Source: Flight Daily News
