AAR Corporation anticipates entering into an MRO joint venture for the Middle East within the next two years as it looks to build its international business portfolio.
Rahul Shah, the company’s Senior Vice President, Asia Pacific, Middle East and Africa, said the company is looking to increase its international portfolio from its current 35% of its total business to 50% within three years. The expansion, he says, will include an MRO joint venture, as well as joint ventures for landing gear and component overhaul services.
“We are in dialogue with various airlines and facilities,” he said.
Shah says the company is looking to leverage its success in supply chain initiatives achieved through its contract with Abu Dhabi’s Advanced Military Maintenance Repair and Overhaul Center (AMMROC). AAR has supported the design, outfitting and integration of key areas of AMMROC’s state-of-the-art facility in Al Ain, the emirate’s second city. The US $38.6 million contract saw AAR design support areas including hangars, work stations and machine and special process shops for the military maintenance center which will open later this year. AAR last year relocated its Middle East regional office to Abu Dhabi’s World Trade Center.
The Middle East’s defence industry is a key target for AAR’s planned growth, particularly in the Gulf where defence budgets are the world’s fastest-rising notching up 8% growth a year. The company has also just begun work on a five-year, US $72 million Complete Logistics Support (CLS) Foreign Military Sales contract to sustain a C-130H aircraft fleet on behalf of the Afghan Air Force.
Shah says AAR will focus on delivering performance-based logistics for the military sector and developing OEM distribution as an integrator for the civil sector focussing on power-by-the-hour contract for airlines in the Middle East and Africa. “We are currently bidding on three contracts in the region,” he said.
“We are in dialogue with various airlines and facilities. We have to, to stay competitive and to reach our aim of becoming number one in the business by leveraging our expertise in planning and forecasting for inventory management.”