SHAH ALAM: IT appears that we will soon have two Hercules MROs operating in the country, if the Finance Ministry has its way. The first one, Airod Sdn Bhd – partly owned by the government while the other – if it happens – will be a subsidiary of a GLC.
By having two MROs, we can bring down the cost of maintenance for the 14 Hercules operated by the RMAF. Cost savings, if it happens, is likely to be the only benefit from having two MROs for a small number of aircraft type.
If indeed the second Hercules MRO is stood up, we will be joining the ranks of Australia by having two aviation firms competing for the same market. The two Aussie firms involved in Hercules MRO are Northrop Grumman Australia and Airbus Group.
The second Hercules MRO in Malaysia could be set up as early as next year once the winner of the restricted tender for the Hercules upgrade is announced. Industry sources told Malaysian Defence that the Finance Ministry is to call for the restricted tender this month, to select the company to conduct the Hercules upgrade which had been stalled for sometime now.
From a previous Malaysian Defence story on the Hercules Upgrade.
Airod was awarded a letter of intent at DSA 2014 for the upgrade of the avionics and communications systems aboard the RMAF’s fleet of 14 Hercules to meet international aviation traffic standards. The work is to be done with Canada’s Esterline-CMC which was selected by the government for the programme.
However, the work had yet to start as the contract had not been signed as Airod seek to work with Rockwell Collins, its long time partner. Industry sources told Malaysian Defence that the government was adamant though that the project be carried out with Esterline. I believed that the government chose Esterline as part of the deal which allowed Petronas to buy a shale gas field in Canada in 2014.
Industry sources said many companies are lobbying to be invited as it is likely that the company that win the upgrade contract will also take-over the Hercules MRO contract. And it is not compulsory that the company that win the upgrade deal be an aviation company like what happened in 2014.
Whoever wins it could always passed along the contract either to Airod or another MRO like the subsidiary of the GLC. That said the subsidiary of the GLC is said to be the favourite this time around. So what will happen if Airod is not selected for the upgrade and MRO contracts then?
It will continue as usual of course. It may have to withdraw its personnel from Labuan where it conducts maintenance for the 14th Squadron. It may have to seek more contracts from overseas like it did with the US Navy. Airod already have various contracts from other air forces as far away as Africa and Middle East though the RMAF contract gave it prestige and legitimacy.
From the US Embassy in Malaysia webpage.
Malaysian aerospace firm Aircraft Inspection, Repair & Overhaul Depot Sdn Bhd (AIROD) has completed repairs on the first U.S. KC-130J aircraft under contract in support of the U.S. Marine Corps Transport Refueler Squadron based in Japan. AIROD delivered the aircraft to the Marine Corps at a ceremony located at Subang Airport on Thursday, August 4, 2016.
The U.S. Navy’s Fleet Logistics Center Yokosuka signed a five-year, $25-million contract with Malaysian aerospace firm AIROD on June 29, 2015. The contract employs approximately 25 engineers and technicians to service thirteen KC-130J aircraft.
Will it be wierd to say the least if Airod, originally set up to service RMAF aircraft, has to rely on foreign contracts to stay afloat?
As I like to say, The More, the Merrier.
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