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COVID-19: GMF expects spike in maintenance orders from flight bans
The aircraft maintenance company is expecting international orders to spike, with the ongoing flight bans diverting aircraft from their scheduled maintenance checks at destinations affected by the COVID-19 outbreak.
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A technician from GMF AeroAsia disinfects a tray table on an airplane in a demonstration of its infectious disease prevention and control (IPC) measures on Friday, Marc 6, 2020. (JP/Riska Rahman)
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T Garuda Maintenance Facilities (GMF) AeroAsia expects to see increasing demand for maintenance, repair and overhaul (MRO) services from non-affiliated international airlines as a result of diverted flights due to the COVID-19 outbreak.
President director Tazar Marta Kurniawan said on Friday that GMF AeroAsia projected a year-on-year increase of 80 percent in the contribution of non-affiliated international airlines for its MRO services, from 71 percent in 2019.
“We might receive more orders for MRO services from international airlines, since those who were scheduled to have maintenance in China, for example, would be diverted to us because of the coronavirus outbreak,” Tazar told a press briefing in Tangerang, Banten.
Notable carriers such as American Airlines, Air France and Qatar Airways have temporarily halted all flights to China in response to the coronavirus outbreak. Several countries, including the United Arab Emirates and Indonesia, have also temporarily suspended all flights to mainland China to prevent the furteher spread of the virus.
Read also: Airlines face $100 billion-plus virus hit, discounts 'wouldn't do any good'
The suspension has left some airlines unable to land in China for scheduled maintenance, prompting them to seek new alternatives for servicing their aircraft.
GMF AeroAsia had so far received three orders for maintenance services from international airlines that were not on the company’s roster this year, Tazar said.
He added that the increased demand for maintenance from non-affiliates could offset the expected decline in orders from affiliate airlines as well as flag carrier Garuda Indonesia and its low-cost subsidiary Citilink Indonesia, “since both airlines have reduced their flights to China and Saudi Arabia for umrah [pilgrimage]”.
This, in turn, could lead to postponements in Garuda's and Citilink's regular maintenance schedules, he said.
With the expected increase in orders from international airlines, GMF AeroAsia would be heightening its prevention measures by disinfecting every aircraft that rolled into its maintenance hangars.
Tazar said that the company had disinfected 19 Garuda aircraft and 13 Citililink aircraft from January to March, as well as 18 aircraft from international carriers during the same period.
Read also: COVID-19: Indonesia still allows flights to and from South Korea amid travel ban
Despite the spike in maintenance orders, Tazar said that GMF AeroAsia would accommodate new orders according to capacity.
The company plans to open a new MRO facility this year in Denpasar, Bali, bringing its total to 25 outstations.
Tazar added that GMF AeroAsia would maintain its revenue and profit projections for the year, with revenue projected to grow 5 percent and profit 10 percent on the back of planned efficiency measures.
GMF AeroAsia was also allocating US$50 million in capital expenditure for 2020, with most of the fund to be used toward both organic and inorganic business growth.
Stocks of the company, traded at the Indonesia Stock Exchange (IDX) with the code GMFI, plummeted by 11.58 percent on Friday against the Jakarta Composite Index’s loss of 2.4 percent. The stocks have lost more than 51 percent of its value throughout this year.
