Air India Seeking To Form Partnership With German MRO Firm Lufthansa Technik
When AI Engineering Services Limited (AIESL) is put up for sale, Tata-owned Air India plans to bid alongside German aircraft-maintenance behemoth Lufthansa Technik and French-Dutch airline Air France-KLM's engineering unit.
Singapore Airlines, which owns 25.1% of Air India, would join the partnership through its engineering subsidiary, SIA Engineering Company Limited.
AIESL, Air India's former engineering department that is now owned by the government, is the MRO (maintenance, repair, and operations) organisation that primarily serves Air India's fleet. Its ownership is critical for Air India to ensure the seamless operation of its fleet of aircraft.
According to a Lufthansa Technik representative, the business is closely studying the privatisation of AIESL in order to increase its footprint in India. "India is a highly dynamic growth market, and the rapid increase in air traffic will increase demand for MRO services." We are already active and successful on the Indian subcontinent with our own component services facility, and we are keeping a close eye on this development in order to compete even more firmly in this growing market," she said.
"One of the negative surprises of privatisation was the loss of Air India's engineering capabilities." AIESL will continue to supply services till the end of the year. "However, given our expansion, what happens after that is a matter of serious consideration," Wilson had remarked.
"AIESL currently handles 90% of our engineering work." So, acquiring AIESL makes sense to strengthen the airline's in-house engineering capabilities," an airline executive said, adding that the firm hasn't decided the consortium's partners or structure.
AIESL is India's largest MRO provider, having six hangar sites around the country and an experienced crew. It handled 450 aeroplanes in FY 22 and earned Rs 840 crore in profit.