Lufthansa to open MRO shop in India

With the number of aircraft soaring in India, leading MRO companies of the world are rushing in take their slice from the Indian cake.

Our Correspondent

Lufthansa Technik is all set to become the first foreign aviation major to set up maintenance, repair and overhaul (MRO) facility in India. The company has sought permission from the foreign investment promotion board to enter the engineering support services market.

The proposal submitted by Lufthansa to the FIPB, says that the company intends to set up a subsidiary called One-Stop Airline MRO Support Private Limited with an initial investment of about one million dollars.

The liberalisation of the aviation sector has resulted in phenomenal growth in air passenger traffic and the number of aircraft flying in India. The sector is poised for unprecedented growth and expansion. Passenger traffic is growing at a staggering pace of 24 per cent at present, and the country will see arrival of at least a hundred more aircraft in a couple of years.

Indian Airlines and Air India have finalised plans to purchase more than 100 aircraft over the next few years. Besides, a large number of private carriers have placed firm orders for acquiring new aircraft.
With the demand for air transportation and number of aircraft soaring in the country, there is clearly a need for world-class maintenance services to help airlines remain competitive and ensure optimum utilisation of aircraft with the highest standards of safety.

It is in this backdrop that Lufthansa Technik has made the request for setting up an MRO in India. The German aviation major is likely to join hands with one of the local private airport operators for land and logistical support. The operators at Hyderabad, Bangalore and Kochi are among those who might benefit with the arrival of the global engineering support service provider.

The government allows foreign investment in such engineering and technical support services on an automatic basis. But since providing these services entail supply of spares and consumables, specific investment approval is required.

The proposal of Lufthansa Technik to the foreign investment promotion board, therefore, specifically seeks permission to provide spare parts and consumables to be used in the maintenance, repair and overhaul of aircraft.

The MRO company has given an undertaking to the government that it will not engage in the retailing of any spares and consumables since retail trade by foreign companies in not allowed in India.
A wholly owned subsidiary of the German airline company, Lufthansa Technik is a world market leader in the maintenance, repair and overhaul of commercial aircraft and their engines and components. It has 26 operatinal subsidiaries and affiliates in Europe, Asia and United States and
is presently servicing about 450 customers worldwide.