MARK PILLING
Strong military sales and the ramp-up of several of its commercial joint venture companies will combine to ensure that Rolls-Royce continues to grow the aftermarket side of its business this year. "The events of 11 September did not knock us off course, we have kept on growing," says Ian Lloyd, managing director, aero repair and overhaul.
A year ago at the Paris airshow the engine giant, which has annual sales of $1.6 billion in the aftermarket, was detecting signs of ill health amongst some of its customers, but the slowdown was accelerated by the terrorist attacks on New York.
Increasing
Today, Rolls-Royce is seeing its civil side picking up, with many carriers again increasing the workscopes – the amount of work put into an engine to give it a certain life before the next scheduled maintenance visit – they specify for their engines, says Lloyd. This will help the company, which was predicting growth of 10% this year before the attacks, to still register a single-digit rise in sales.
In addition, revenues from the Rolls-Royce strategy of being first to market in overhaul terms for its own engines are flowing faster than ever. "Part of our strategic development has seen certain businesses coming on line now or picking up as planned," he adds.
In February, its joint venture with Singapore Airlines subsidiary SIA Engineering – Singapore Aero Engine Services Ltd – opened, and will overhaul 40 Trent engines this year. Business is also "rising just as anticipated" at Hong Kong Aero Engine Services Ltd, its joint venture with Cathay Pacific's Hong Kong Aircraft Engineering Company and SIA Engineering to maintain Trents and RB211s.
As far as its main airline joint ventures go, Europe is the "last piece in the jigsaw" for Rolls-Royce to fill, says Lloyd. In the Americas it has Texas Aero Engine Services, a large Trent/RB211 shop established in partnership with American Airlines. The company did have a venture with Swiss overhaul giant SR Technics designed to complete the global picture for Trent overhauls, but that was "unwound" at the end of 2001 with the bankruptcy of SR Technics' parent Swissair Group.
There is a demand for further Trent capacity in Europe, but as the demand is still relatively low Rolls-Royce appears to have time on its side to find the right solution.
Selection
One option raised by the selection of Trent 900s to power Lufthansa's Airbus A380s, is for the German carrier's overhaul company Lufthansa Technik to enter the Trent business.
"The proposal to Lufthansa covered many aspects of engineering support," says Lloyd, who refuses to be drawn on whether a deal is a possibility. "It is not an immediate issue," he states, "but you can expect we will do something." Whether this something is a deal with a carrier or whether Rolls-Royce expands its own Trent workshop in the UK remains to be seen.
Source: Flight Daily News
