Globally, aircraft maintenance is called MRO (maintenance, repair and overhaul) activity and its worldwide volume amounts to more than 30 billion euros per year. A number of companies operate in all of the four main areas of MRO business, namely line maintenance, overhauls, engines and components. Finnair Technical Services does so as well.
In terms of size, Finnair Technical Services, with its turnover of just over 200 million euros, is rather small compared with the sector’s large operators. Nevertheless, there is strong global demand for high-level expertise, and Technical Services, which has grown alongside the airline, has an excellent reputation. The utilisation rate of Finnair’s wide-bodied aircraft has been very high and this has been noticed around the world.
The sector has been in upheaval, however, for many years – partnerships, acquisitions, consolidations and joint venture have become commonplace. Aircraft and engine manufacturers want to be involved in the secondary market, while companies that make a living selling spare parts and components are expanding their operations into services. The common denominator for everyone is perpetual cost hunting and intense competition for work, which in turn is a consequence of the merciless competition under way for flight passengers.
In this operating environment Finnair Technical Services has been creating and implementing a new strategy for some time now. The objective is to develop above all into a strong player in the growing Russian market, while not forgetting the domestic market and other neighbouring areas. Russian operators have rushed to acquire western aircraft, and it is natural to offer the maintenance services they require from their neighbour Finland. A key element is getting the product portfolio exactly right. There must be demand in the market for the offered products, and companies must be able to invest in them in order to achieve the necessary expertise, resources and volume.
As a natural part of the strategy, Finnair Technical Services was incorporated into two independent legal companies at the turn of the year. Finnair Engine Services will focus mainly on engine and landing gear repairs. Finnair Technical Services will keep within it overall support for operators as well as the other areas of MRO activity mentioned above. The goal of the incorporation arrangement is genuine financial monitoring, but above all to put the companies in a better position to acquire external customer relationships. An important new initiative is to target cooperation with operators offering those areas of the business that Finnair Technical Services cannot because of its size.
The development of MRO business is a long-term effort. Becoming a professional in this field requires many years of suitable training and job experience. In a year or two it’s simply not possible to establish oneself as a credible operator, but it’s also possible to lose one’s way very quickly.
Technical Services personnel have admirably committed themselves to the strategy. Last year’s theme was that the current difficult economic conditions can be overcome through hard work. A wise man once said: “Opportunities are usually masked as hard work – that’s why people don’t necessarily recognise them”. It seems to me that now at least we are trying the grasp our opportunities – with no fear of work.
Vesa Paukkeri
Filed under: Technics | Tagged: Finnair Technical Services, maintenance, MRO, Technics
