SR Technics Malaysia Gains Thailand Certification
SR Technics Malaysia, the Swiss MRO’s component repair center in the Asia-Pacific region, has had its airworthiness certificate extended for component maintenance by the Civil Aviation Authority of Thailand (CAAT).
The approval, which was granted last month following an auditing process, is valid for three years and will give the company the green light to repair parts under Thailand’s aviation safety body. This covers parts on Thailand-registered aircraft as well as third-parties in the Asia-Pacific requiring CAAT certification.
It supplements more than 800 components repaired by SR Technics in Malaysia approved by regulators such as the FAA, EASA and China’s CAAC, which it received approval from early last year.
SR Technics Malaysia opened in April 2014 and provides component maintenance for Boeing and Airbus aircraft including the Airbus A320 family, the A330, the A340 and the Boeing 737NG.
Thomas Kennedy, vice president component maintenance at SR Technics, says the approval will provide a further boost to the MRO. “The certificate opens up possibilities to further support our customers in Thailand and nearby countries and helps consolidate our business in the competitive Southeast Asia region,” he says.
AoT seeks govt's nod for B202bn plan to build new airports
The planned construction of Terminal 2 at Suvarnabhumi airport still needs the nod from the new government. (Bangkok Post photo)
Airports of Thailand Plc (AoT) will ask the new government to approve its 202-billion-baht development plan, including investing in new airports in Phuket and Chiang Mai.
The plan is meant to boost the passenger handling capacity of airports in the country, said AoT president Nitinai Sirismatthakarn.
Under the plan, a new Phuket airport would be built at a cost of 75 billion baht, and would handle 10 million passengers a year.
Another airport would be built in Chiang Mai for a reported cost of 15 billion baht. The new airport would handle at least 10 million passengers a year.
Once approved by the new government, it could take about one year to expropriate land for the two airports, Mr Nitinai said, adding that construction could take four years.
"The two airports could be launched in 2025 and both are likely to become international airports," the AoT president indicated.
Other projects under the plan include the third-phase development of Don Mueang airport costing 32 billion baht. The development is meant to spur the airport's passenger-handling capacity to 18 million passengers a year.
Work is under way to conduct an environment impact assessment (EIA), said Mr Nitinai.
Suvarnabhumi airport's 42-billion-baht second terminal is also included in the plan. For the second terminal, AoT plans to ask for official approval from the Transport Ministry and the National Economic and Social Development Board (NESDB). Most pre-construction tasks such as the EIA and design have been completed and the company is only waiting for the official nod from the ministry and the NESDB.
Suvarnabhumi's second terminal is expected to be completed between 2022 and 2023, he said.
The transfer of four airports in Udon Thani, Sakon Nakhon, Tak and Chumphon from the Department of Airports to AoT is also part of the plan. Improvements will be made at the four airports costing 3.5 billion baht, he said, adding that Udon Thani airport will be upgraded to be an international airport.
Negotiations about the transfers have been completed and the Transport Ministry is considering the matter before forwarding it to the cabinet for approval, Mr Nitinai noted.
Duty-free giant King Power recently secured three AoT contracts, covering the operations of duty-free shops and commercial areas of Suvarnabhumi airport as well as duty-free shops at three airports -- Phuket, Hat Yai and Chiang Mai.
Mitsubishi to buy Bombardier regional-jet unit for US$550m
Mitsubishi Heavy Industries agreed to buy Bombardier's regional-jet program for US$550 million, extending a push into commercial aircraft and setting up a rivalry with Embraer.
The Japanese manufacturer will acquire the maintenance, support, marketing and sales operations for the aging CRJ program through the cash deal, according to a statement by the companies Tuesday. Mitsubishi is also assuming liabilities of about US$200 million and taking over Bombardier's interest in a regional-jet securitisation program, which is valued at about US$180 million.
While Bombardier will wind down production of the CRJ line of short-haul jets over the next year and a half, the acquisition gives Mitsubishi an expanded global presence spanning engineering, development and support functions. That will bolster the company's ability to market its new SpaceJet regional aircraft, the first airliner built in Japan since the 1960s.
For Bombardier, the transaction essentially ends a three-decade presence in the commercial aircraft market as it narrows focus on making business jets and passenger trains. The Canadian company last year handed control of its C Series jetliner program to Airbus, which renamed the plane the A220.
The deal, expected to close in the first half of next year, "represents the completion of Bombardier's aerospace transformation," chief executive officer Alain Bellemare said in the statement.
Mitsubishi, which sees global demand for more than 5,000 regional jets over the next two decades, will face off with Embraer in the market for small aircraft. The Brazilian planemaker is in the process of combining its commercial-jet business into a joint venture with Boeing.
Mitsubishi has spent at least US$2 billion developing the SpaceJet, which has been plagued by delays and production snags. The company is moving closer to the debut of the aircraft line, formerly known as the MRJ.
Bombardier will keep control of a CRJ production facility in Mirabel, Quebec, and supply spare parts for the plane, which is expected to end production in the second half of 2020, the companies said. Bombardier will also retain liabilities representing part of credit and residual-value guarantees totaling approximately US$400 million.
Suvarnabhumi lines up B11bn 'airport city' project
Airports of Thailand Plc (AoT) aims to
develop an "airport city" project at Suvarnabhumi airport at a cost
of 11 billion baht.
It will be developed under a public-private
partnership scheme, said Pattanapong Suwannachat, chief financial officer (CFO)
of the AoT, adding the project will cover 900 rai of the airport's Zone A and
723 rai of Zone B.
According to him, Chinese giant Alibaba Group
has expressed interest in building a warehouse since the company realises the
growing trend of e-commerce business in Thailand and Asean.
Regarding import duty on products sold
online, it would be waived if the items are priced lower than 1,500 baht, and
this is a business opportunity for small-scale transport, he said.
"The airport city project could be
launched within four or five years," said Mr Pattanapong.
According to the company's CFO, the AoT will
also soon sign a memorandum of understanding with an airport in Belgium to set
up a facility to check and certify farm products in line with European
"We'll be among the first in Asean to provide this service," said Mr Pattanapong.
He said initially the hub would help certify
roses, which are grown in Thailand and mostly exported to China.
AoT reported 33 billion baht in revenue
between October and March, up 5% from the same period a year earlier. It also
registered a profit of 14 billion baht in the period, up 3.98% from a year
The rise is earnings stemmed from growth in
tourist arrivals, Mr Pattanapong said.
Over the past seven months, the number of
passengers handled by AoT airports has risen by 2.2%, he added.
Thailand passes ICAO inspections
The International Civil Aviation Organisation
(ICAO) said Thailand achieved an effective implementation of standards score of
65.07%, which exceeds the minimum pass threshold of 60% set by United Nations'
The score was awarded after a full team of
ICAO officials carried out a Coordinated Validation Mission on Thailand's civil
aviation standards between May 13-22, Civil Aviation Authority of Thailand
(CAAT) chief Chula Sukmanop said on Monday.
Thailand was red-flagged by the ICAO in June
2015 for failing to adequately deal with "significant safety concerns
[SSCs]" within the specified time frame.
After all 33 SSCs were addressed, the UN
watchdog lifted the red flag in October 2017, although a lot still needed to be
done to meet international standards across all seven categories -- which
comprise rules and regulations, regulatory mechanism, officer authorisation,
airside operations, fleet airworthiness, flight services, and airport
"The country only scored 34.2% when it
received the red flag four years ago. Now it has risen to meet the
international standards across the board," he said.
Mr Chula said that he believes the US Federal
Aviation Administration will also upgrade Thailand's aviation status.
"However, the CAAT still needs more
inspectors to test pilots -- especially for ATR aircraft -- before inviting the FAA to reassess our
score," he said.
Meanwhile, the contracts relating to the
construction of Suvarnabhumi airport's third runway are likely to be signed
early next year at the latest, according to Airports of Thailand (AoT).
"The new 21.7-billion-baht runway --
which is included in the airport's second-phase development plan -- has been
approved by the cabinet, AoT president Nitinai Sirismatthakarn said.
The AoT is in the process of drafting the
terms of reference (ToR) for the runway construction's bidding process, he
said, adding the ToR are likely to be forwarded to the company's board for
consideration by June or July.
"It could take up to six months to get
the bidding process started and select the winner," Mr Nitinai said.
"The winner is expected to sign the contracts either by late this year, or
early next year."
The AoT is currently working on the project's
environmental and health impact assessment, the results of which will be sent
to the National Environmental Board for approval, he said.
The process can be done in parallel with the
bidding, he said, adding he is confident the report will be approved.
Airbus to send venture proposals
European aircraft manufacturer Airbus has been urged to submit
related proposals for the formation of a joint venture with Thai Airways
International Plc (THAI) by June 7 to develop the maintenance, repair and
overhaul (MRO) facility at Rayong's U-Tapao airport.
Airbus and THAI signed an agreement to jointly invest in the
project in June last year. The two organisations are currently discussing
details under the joint venture deal. The 11.2-billion-baht scheme is one of
the five megaprojects under the government's Eastern Economic Corridor (EEC)
THAI president Sumeth Damrongchaitham said the EEC policy
committee has made it clear that Airbus must submit proposals to THAI for the
establishment of the joint venture within a month or by June 7.
He said THAI and Airbus still have various concerns to thrash out.
Airbus is about to float certain details for discussion later after the
agreement is signed, Mr Sumeth said, adding the concerns range from legal
elements to management issues.
Referring to THAI's plan to acquire new planes, which are worth
156 billion baht, Mr Sumeth said the airline is in the process of submitting it
to the Transport Ministry for consideration.
He said a study is also being carried out for the lease of two to
four aircraft. Expedited efforts will be made to wrap up the study, which will
be sent to the airline's board for consideration, he noted.
"The leased planes must be used for at least six years so as
to break even," said Mr Sumeth. He said the management would ask the
airline's board to approve a new Bangkok-Sendai, Japan flight and the proposal
is likely to be given the green light.
The management wants the board to approve the new flight plan as
quickly as possible in order to seek a budget and map out a timetable for the
flight, which would be launched on Oct 27.
THAI to seek Cabinet approval for acquiring 38 new planes
THAI AIRWAYS International Plc (THAI) expects to this month propose to the Cabinet its project to procure 38 new aircraft at a total cost of about Bt156 billion.
The procurement plan has already been forwarded by the National Economic and Social Development Board (NESDB) to the Ministry of Transport, THAI president Sumeth Damrongchaitham, said. The ministry in turn is expected to propose the matter to the office of secretary-general of the Cabinet within this week and then to the Cabinet within this month. The procurement would be in two phases. About 25 new aircraft will be purchased in the first phase and 13 in the second phase. Of the total, 31 new aircraft would be used to replace older planes that will be gradually decommissioned over the next 10 years, while the remaining seven planes will be assigned to new routes in the future. Meanwhile, THAI is planning to open the Bangkok-Sendai (Japan) route this November, due to Japan’s growing popularity as a destination for Thai people.
Recently, Manchester airport, the UK’s fourth busiest airport by passenger traffic, met officials from THAI about increasing direct flights. Thai tourists have been travelling to the north of the United Kingdom, but experience some difficulty in obtaining visas to the country, said Sumeth. The airport authority will seek solutions to the visa-approval problem. In regard to a solution to the Rolls-Royce engine problems that have affected six to seven of the airline’s planes, THAI is now negotiating with the British jet engine manufacturer for compensation. The airline has hedged against global oil price fluctuations and has adjusted its ticket prices to reflect actual costs. But the Thai flagship airline has taken a cautious approach to adjusting ticket prices, given the high competition, and it believes now is not the right time to raise ticket prices. Sumeth, who is also chairman of Thai Smile Airways, said he has assigned both companies to connect their policies, merge administrative centres for cost reduction and have separate service and aviation sections without reducing staff. “Merging the centres will allow connectivity of overseas routes of Thai Smile and THAI, to facilitate passengers’ transits in the country and abroad. Thai Smile is expected to have satisfactory performance at the end of this year, thanks to new cost management and resource sharing,” Sumeth said. Meanwhile, THAI has reported total revenue of Bt200.58 billion, and a net loss of Bt11.62 billion for 2018 year-end, higher than its Bt2.10 billion net loss in 2017.
Airbus, Thai Airways to ink U-Tapao Deal in May
Pierre Jaffre, president of Airbus Asia-Pacific, discussed with Somkid the arrangements for the project, which is regarded as a showpiece development for the Eastern Economic Corridor (EEC). Airbus has teamed up with Thai Airways International (THAI) to construct the MRO centre at U-Tapao airport in Rayong, one of the three provinces in the EEC. Also attending the talks were Jacques Lapouge, the French ambassador, and Georg Schmidt, the designate German ambassador to Thailand.
Somkid told them that the groundwork was being laid for the EEC’s infrastructure projects and that they were moving ahead as planned. He also advised them of Thailand’s cooperation with China’s Zhengzhou Xinzheng International Airport for the development of U-Tapao’s Airport City project.He said the MRO project could be run as a public-private partnership (PPP) scheme and the EEC Office would take charge of this. A contract for the project would be ready for signing this month, marking progress for the partners after a period of delay, he said. “Airbus knows that investing in the MRO centre in Thailand will yield the best economic return compared to other regions,” Somkid said. “In May, negotiations will certainly reach their conclusion. The Airbus executive has flown in to discuss this matter in particular. If it (the negotiations) cannot be concluded, he will not go back. We’re confident that within this month, the contract signing will be made.” According to a source from Government House, during the discussions Airbus expressed concerns over the joint investment between itself and THAI, especially relating to ownership of the project. If the MRO project is specified as being owned by THAI, which is a joint investor with Airbus, the contract may not be able |to be signed under a PPP scheme because both are private enterprises, the source |said. Given this constraint, Somkid has asked THAI chairman Ekniti Nitithanprapas to hold more discussions with Airbus, with a view to proposing that it sign the contract with the EEC Office, the source said. In such a case, the EEC Office would be the project owner, with Airbus and THAI as joint investors, the source said. Of the total investment of Bt10.58 billion in the project, Bt6.333 billion will be made by the public sector and Bt4.255 billion by the private sector. The expected return on the project is Bt38.87 billion, about Bt36 billion of which will be given to the public sector and Bt2.87 billion to the private sector. The expected economic return, excluding those from hi-tech employment valued at Bt80-billion and a Bt200-billion increase in income from services to foreign airlines, is about Bt22 billion. Once the MRO centre is completed, THAI’s repair centre would be removed to pave the way for construction of U-Tapao airport’s second runway and a new passenger terminal. The centre is expected to start services in 2022.
Third runway for BKK Suvarnabhumi Airport approved
A PROPOSED third runway for Suvarnabhumi International Airport has cleared the final hurdle, with the Cabinet yesterday approving the Bt21.8 billion project.
The construction, to be overseen by the Airports of Thailand (AOT), is scheduled to be completed in 2021.
Deputy government spokesman Weerachon Sukhondhapatipak said work is scheduled to begin this year.
A plan for the construction of the taxiway B2 extension, at a cost of Bt622.33 million, was dropped. That decision enabled the overall cost of the project to be reduced from the originally envisaged Bt22.42 billion, Weerachon said.
A contract is expected to be signed after the Environmental Health Impact Assessment (EHIA) gains approval from the Office of National Environment Board.
The third runway will enable 30 more flights per hour for Bangkok’s main airport.
Its two runways can accommodate 64 flights an hour.
The western runway is 3.7 kilometres long and the eastern one is 4km.
The two runways average 63 flights an hour during busy times. If an emergency occurs or a runway is closed for maintenance, total runway capacity will be almost halved to 34 flights an hour.
The 4 km third runway will be in the western part of the airport, the same side as the main warehouse and the current western runway.
Once the third runway comes into service, it will also be used for cargo flights when the western runway is closed for maintenance.
This project will include a navigation system, the construction of drainage system and fire and rescue stations.
The project is part of Thailand’s transport infrastructure development plan from 2015.
According to the Ministry of Finance, the AOT should apply appropriate risk management for the project.
The third runway will provide a low rate of return and it will be 20 years before it breaks even.
The AOT will also coordinate with agencies such as Aeronautical Radio of Thailand Ltd to plan construction of a fourth runway to cope with future air traffic, and set a standard to reduce any impact that may arise from delays and service quality of Suvarnabhumi airport.
Thailand to support aerospace sector via new incentives
According to the state owned agency BOI, Thailand is positioned to become the leader of MRO in Southeast Asia by supporting a rapidly expanding aerospace sector via incentives
The Thailand Board of Investment (BOI) has approved investment promotion incentives for companies that choose Thailand as their base of aircraft maintenance, repair and overhaul (MRO) activity.
Thailand’s MRO expenditure from 2015-2024 has been forecasted to reach a total amount of USD $10.6 billion, with airframe, engine and component MRO being specifically targeted.
As Thailand hosted a record 38 million visitors in 2018, and expects 40 million in 2019, its aerospace sector is growing at an astounding rate uniquely positioning the Kingdom to lead ASEAN in MRO activity.
“Thailand’s geographic position and strong expertise in the aerospace industry are why global companies choose us when they’re ready to expand their operations to Asia.”
Thailand’s MRO flagship will be the Eastern Airport City (Aerotropolis), anchored by U-Tapao airport, in the country’s Eastern Economic Corridor.
The Aerotropolis project, part of a 15- year aviation development plan for Thailand, calls for an expansion of U-Tapao’s passenger capacity from 5 million passengers to 54 million in the next 30 years.
The Aerotropolis will serve as an MRO hub and will be connected by rail, roadway, and sea to other major airports including Suvarnabhumi and Don Mueang International Airports.
One of the reasons why aerospace companies continue to choose Thailand as their ASEAN regional base, aside from the skilled workforce and the size of the market itself, is the generous support of the Thai government.
8 years corporate income tax exemption
Companies that expand to Thailand receive investment incentives such as 8 years of corporate income tax exemption, plus an additional 5 years of 50% reduction of the corporate income tax rate after the exemption period. BOI offers another 2-4 years of corporate income tax exemption for investment projects based in the Aerotropolis that pair with local educational institutions on workforce development initiatives.
Global aerospace brands have been present in Thailand for decades, and the Kingdom shows no signs of slowing down in attracting large multinational companies.
Recently, a leading aircraft manufacturer announced plans to establish a new MRO facility at U-Tapao Airport, in a joint venture with Thai Airways.
Similarly, Revima, the French APU and landing gear MRO specialist, has started construction of a new landing gear overhaul facility in Chonburi, Thailand. The 12,000m 2 facility will focus on Airbus A320, Boeing 737 and ATR family landing gears.
It will be equipped with state-of-the-art machines and will include all necessary special processes for full in-house repair & overhaul of landing gears. Another investor, BOSA, a UK-based aircraft component maintenance services provider, has launched a joint MRO venture, BOSA-Thayaan Aircraft Service (BTAS), to perform line maintenance operations at U-Tapao Airport.