PT Garuda Maintenance Facility (GMF) AeroAsia Tbk, a subsidiary of national flag carrier Garuda Indonesia, has kicked off its expansion efforts by collaborating with partners to realize its vision of becoming a top 10 maintenance, repair and operations (MRO) company worldwide. This has been reinforced through a series of signings at the 2018 Singapore Airshow, deemed the largest airshow in Asia.

GMF inked deals on aviation maintenance with a number of aviation companies at a gala dinner in Singapore hosted by GMF and Garuda Indonesia Group on Wednesday evening. A series of collaboration signings were also held at Garuda Indonesia Group’s booth in the Changi Exhibition Hall.

The companies that signed the deals at the gala dinner were Indonesia Air Asia Extra & Indonesia Air Asia, Air Asia X Berhard, Airfast Indonesia, Eastar Jet and Jayawijaya. The agreement on aviation maintenance is mostly related to airframes, engines and components.

In attendance at the event were Industry Ministry director general of metal, machinery, transportation equipment and electronic engineering Harjanto, Indonesian Ambassador to Singapore I Gede Ngurah Swajaya, the Garuda Indonesia board of commissioners, Garuda Indonesia Group representatives and GMF customers, partners and investors.

Speaking at the gala dinner, GMF president director Iwan Joeniarto said that, in 2018, GMF was prepared to expand.

“We brought in many partners to ink the agreement at the 2018 Singapore Airshow. GMF has a vision to expand its business in 2018 by adding to its global influence.

“As a public company, GMF has a responsibility to educate its investors and the public about the MRO industry, and this event is one of the good moments for that,” he said.

According to Iwan, GMF’s strengths lied in its service flexibility, competitive prices, integrated solutions and signature work style of brining in elements of empathy and hospitality.

He said GMF was a world-class MRO company and market leader in Indonesia, with quality and reliable services. “We should not have any doubts about our quality […] we are only a few steps away from becoming a top 10 MRO [company] in the world,” he said.

GMF, he went on, was committed to delivering in technical excellence and building strong partnerships. “We are trying to become the MRO [company] of choice by delivering tailored solutions shaped by our instinctive generosity, empathy and flexibility.”

He further said that with its world-class facilities, delivered at a reasonable man-hour rate, “we believe we could leverage our new brand image as a total solutions MRO provider.”

GMF also saw a series of signings with aviation-related businesses at the Garuda Indonesia Group booth. They include Germany’s Bucher, a provider of in-flight kitchens; Thales, a provider of in-flight entertainment systems; Stelia, a provider of aviation seats; Australia’s KORR Group; GME Aviation from the Middle East; state aircraft manufacturer PT Dirgantara Indonesia and the Indonesian Air Force.

“Australia offers a promising aviation maintenance market. From the viewpoint of quality, GMF is able to compete with other world-class MRO [companies],” he said of the deal with KORR Group.

GMF also signed a partnership deal with Dubai-based GME Aviation, one of the largest aviation business groups in the Middle East.

GME Aviation CEO Kalyan Tewari said following the signing ceremony, the company was eager to bring GMF to the Middle East, which has seen a rapidly growing aviation industry.

The agreement may have the potential to be valued at US$10 million. “The business will continue to develop and, through to 2020, the business will expand fivefold. Aviation maintenance businesses in the Middle East are highly promising and partnering with GMF, with all its capabilities and quality, is the right choice,” said Tewari.

Iwan told journalists prior to the signing ceremony that GMF’s participation in this year’s Singapore Airshow carried the theme, “Grappling the Customers” and “Expansion and Partnership”, which corresponds to GMF’s program launched when it conducted an IPO (Initial Public Offering). “Starting this year, GMF will start with its expansion and partnership programs,” he said.

Part of the program has been drawn up under its five-year masterplan that includes new, additional programs. “Garuda Indonesia Group’s total target will reach US$2.4 billion […] but bear in mind that the $2.4 billion is over a multi-year term,” he said.

The $2.4 billion target would come partly from domestic aviation companies under the same group, namely Garuda Indonesia and Citilink Indonesia, and the remaining would come from regional countries, such as Vietnam, Thailand and Korea. “We are focusing on Asia and Australia,” he said.

When it came to customers for MRO services, geography was a factor that needed to be considered, according to Iwan. “The continent our customers came from this year and two years ago is the same – Asia. But what makes this year’s collaboration different from the previous years are the signings with partners and the expansion,” he said.

To realize the expansion and partnerships, GMF has invested around US$400 million, $100 million of which was invested this year alone. “So the target of $2.4 billion is feasible because we have also made a big investment,” he said.

According to Iwan, collaborating with partners could enhance GMF’s capabilities and competency.

GMF is targeting domestic aviation companies, both low-cost carriers and full-service airlines, which mostly rely on overseas maintenance services and regional customers. “Domestic and regional customers currently spend the most in the world on aviation maintenance services.”

Currently, he said that the percentage of maintenance services handled by Garuda Indonesia Group was 52 percent, while the remaining percentage was handled outside of the group. “So the handling of maintenance services from non-affiliated customers has almost reached 50 percent. And the demand for handling from non-affiliated customers is apt to go up,” he said.

Iwan acknowledged the competitive challenges of MRO services. However, only those who are efficient [and] give added-value for customers can stay competitive, he said. “We always come with new innovations, solutions, which is important for customers, because maintenance requires high costs. Those that come with solutions and alternative solutions will come out ahead of the competition,” he said.

According to Iwan, technology was another challenge. “We have to boost our technological capability. Therefore, in this regard, we try to find partners as this will bolster our knowledge and competency without putting aside efficiency and costs,” he said.

The demographic bonus that Indonesia had was an example of cost-efficiency, he said. “This could be one of our weapons to win the competition in the labor-intensive MRO [industry].”

Popular

Volcano erupts in North Sulawesi, hundreds evacuated

Dubai roads, airport reel from floods after record rains

Ramadan boosts consumer confidence, retail sales