AirAsia To Divert MRO Services To M'sia

May 22, 2007 22:00 PM

KUALA LUMPUR, May 22 (Bernama) -- AirAsia Bhd expects to see a cost saving of between 15 and 20 percent, especially for fuel, when it diverts its maintenance, repair and overhaul (MRO) services back into Malaysian shores from Singapore, said chief executive officer Datuk Tony Fernandes.

"Maintenance makes up about 25 percent of our operating cost, of which half of it is from the MRO alone," he told reporters after the signing ceremony between AirAsia Bhd and MRO provider, Sepang Aircraft Engineering Sdn Bhd (SAE) here Tuesday.

He said the planes now just need to be towed to SAE as opposed to flying them to Singapore.
"That is a huge savings already," he said.

He said SAE, which aimed to open for business on Oct 1, could potentially clinch US$40 million (US$1=RM3.38) from AirAsia as its anchor client.

Meanwhile, SAE chief executive officer Syed Budriz Putra said the company was also looking at attracting regional budget airlines, especially those from India.

"This is because they (Indian budget airlines), like Kingfisher and Indigo also use the A320 planes just like AirAsia and we can capitalise on that," he said.

-- BERNAMA