Aero Contractors completion of C-Checks at MRO facility signal turn around after AMCON takeover
Aero Contractors, in January this year, completed its first C-check on a Boeing 737-500 series at its Maintenance, Repair and Overhaul (MRO) facility located at the domestic wing of Murtala Muhammed Airport in Ikeja, Lagos. This aircraft maintenance procedure, done for the first time in West Africa, signals a remarkable turnaround for an airline that has been steadily working to reverse a downward trend that started about 7 years ago. The firm reached the cusp of a major crises two years ago, in February 2016, causing AMCON to fully intervene in order to forestall a total collapse. The capability to conduct a C-check, – an individual feat for the company and a major win for the local aviation industry – is however, a testament to the restructuring work going on at the airline. Critical to the success of its restructuring drive has been its ability to identify a new path forward, play to its key strength, and build on its core competences.
C-checks are critical detailed maintenance checks that have to be carried out on airplanes after a specified number of flight hours. It requires that a majority of the plane’s components are thoroughly inspected, which means that it has to be put out of use until the maintenance is complete. Prior to this time, heavy maintenance checks such as C-checks and the more extensive D-checks were carried out on the sites of MRO companies due to the need for hangar space and expertise. These sites are often based outside Nigeria in places like Israel, Jordan, South Africa, Ethiopia, Morocco and America.
This milestone procedure was achieved after a series of operational revamp efforts led by AMCON upon taking over. Some of the revamp efforts include replacing the previous management, which was riddled with corporate governance issues, with an experienced management team saddled with a renewed focus on achieving quick turn-around. Furthermore, the company mapped out a strategic vision and embarked on a diversification drive as a means to resuscitate the airline. The decision to diversify into aircraft maintenance was a viable strategy given that firstly, the airline had some existing capacity that could be leveraged. Secondly, a big domestic market already existed for the service, as Nigerian domestic airlines operate about 22 B737 planes that would be in need of servicing from time to time. The decision was also borne out of Aero’s need to have its own planes serviced.
To fulfil this diversification strategy, Aero obtained certification from the Nigerian Civil Aviation Authority (NCAA) in September 2017 to conduct C-checks on Boeing B737 aircraft. It also deployed capital towards renovating and expanding its MRO facility, in order to meet the required local and international standards. It further secured agreements with international partners, such as the maintenance unit of Ethiopian Airlines, South Africa’s Technik, and British firm AJW, to provide C-check support. With these foundational structures, the airline says it is looking forward to being able to perform D-checks, a more detailed critical maintenance procedure.
Although Aero’s foray into the provision of maintenance services started out as a response to an in-house need to service its own Boeing 737-500 aircraft series under a tight budget, it looks set to now provide the service to third parties, i.e. other airlines that have the same series in their fleet. According to the firm, airlines will benefit in the form of a significant reduction in their maintenance costs as they will not be required to leave the country. They will also benefit from a reduction in the downtime suffered by airlines when their planes go through such extensive maintenance procedures outside the country. According to Aero’s CEO, Captain Ado Sanusi, the airline does not intend to stop there. It further aims to expand its services beyond the Nigerian market by obtaining a European Aviation Safety Agency (EASA) certification as well as FAA (Federal Aviation Administration) approval.
In trying to prevent the organisation from bleeding out cash completely, the management trimmed its bloated workforce by up 60%, thereby drastically cutting down on its operational costs. A significant part of its workforce had become redundant because a large number of Aero’s aircraft became grounded. In the light of this, maintaining a large workforce dedicated to those grounded planes became unjustifiable. This however, did not go down well with its workers who threatened to embark on industrial action. To worsen the situation, the firm’s low cash position constricted its ability to adequately compensate the laid-off workers. That notwithstanding, the management gave guarantees to re-engage the redundant staff as more planes are recalled into operation. It estimated that it would have about 6 planes back in the air by 2018. As matter of fact, about 68 of those redundant workers were recalled a few weeks back. Many more workers, it was gathered would be recalled in the near future.
Aero is deep in the process of rebuilding its capabilities in line with its strategic goals, by leveraging its international technical partners. Following the deepening of its technical ability and the acquisition of the requisite Nigerian Civil Aviation Authority (NCAA) certification, Aero Contractors is now fully able to conduct C-Checks for third party airline operators both in Nigeria and across the West Africa region, thereby contributing to the attractiveness of Nigeria as an aviation hub. The airline has identified ways in which its victory can be even further stretched. According to Captain Sanusi, the airline’s CEO, it has applied to be granted a Free Trade Zone status by the Nigerian Export Processing Zones Authority (NEPZA), in order to further reduce its maintenance turn-around time for the benefit of its customers. Right now, it still endures avoidable delays by Customs during the importation of special tools required for the maintenance. In addition to revamping, restructuring and upgrading its MRO support services, the airline has also hinted at acquiring two new aircraft with some partners, meaning that more of the redundant workers would be recalled onboard.
Aero airline currently managed by Ahmed Kuru-led AMCON is continually making giant strides towards regaining its market leadership position. The decision to successfully diversify into maintenance has been a game-changer. The airline has indicated that its fleet could grow to about 8 aircraft this year. As it does so, it has begun to reabsorb most of its technical staff in a bid to rebuild capacity. No wonder industry analysts and aviation enthusiasts have been giving credit to AMCON for providing the impetus that was critical to Aero ringing the much-needed change that was necessary for its resurgence as the oldest and most dependable airline in Nigeria.
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