Hungarian MRO Aeroplex announced plans to build a new 26,246 ft.2 widebody maintenance facility in Budapest by early 2022. Arpad Demeny, CEO of Aeroplex, tells James Pozzi why it decided to venture into widebody maintenance and how the government-owned business sees the recovery of Central & Eastern Europe’s commercial aftermarket.
What were the primary drivers behind Aeroplex choosing to expand in Budapest?
The extension of Aeroplex through building a new hangar was an old dream going back several years. This potential project to extend line maintenance widebody capabilities to base maintenance and component repairs was first talked about in 2017. The main driver was to add new services, such as widebody maintenance, engine parts, defense projects, helicopters and cargo work. When I took over in 2016, extending capabilities was among our key strategies. This is the first year since then that I’ve really seen the results. When COVID-19 hit and passenger aircraft maintenance decreased, we saw an increase in cargo aircraft work. The slowing of the passenger business was recovered by our alternative business.
How is the hangar being funded?
We are a 100% government-owned company and to date it has been very supportive in our efforts. The new hangar project is financed through bank funding and will cost around €28 million ($33.1 million). Of course, this is just the cost of the hangar and doesn't take into account the incoming manpower, tooling, equipment and docking system required for widebody aircraft.
The foundation stone was laid last month. What are the next steps in the run up to the early 2021 opening?
The construction started immediately after the foundation stone ceremony. This followed a two-year procedure encompassing multiple agreements, discussions with Budapest Airport, the banks and construction companies. The foundation stone ceremony occurred when everything had been signed. February 2022 was announced as the opening date but it is my target is to get it completed by the end of 2021. This could be dependent on the weather over the winter months in Hungary.
The widebody MRO market is expected to take longer to recover than the narrowbody segment. Do you have any concerns related to this?
Not at all. Aeroplex will be among the few MROs in its region with the size of capabilities and capacity for widebody aircraft. This is especially rare for an independent. The big regional players with widebody hangars with base maintenance capabilities are Lufthansa Technik, LOT and Turkish Technic, but we are non-carrier affiliated. The know-how and the capabilities to deal with demand fluctuations are why I remain optimistic.
Up to 200 new jobs could be created as a result of the Aeroplex expansion. Will these primarily be in technical positions, such as mechanics and technicians?
That is the number of people I am looking for. One of the main topics I've discussed over the past few years has been related to the lack of available manpower. Everybody in the industry is suffering from this. We started a dual training programs with a high school and a university, so we've looked to build partnerships to help us in the past three years. One of the few positives of COVID-19 has been access to labor--this year alone Aeroplex has hired around 130 people, many who are B1 and B2 certified. Back in 2019 and earlier, this would have been nearly impossible to do. This is partly due to the number of people returning to Hungary, who had previously worked overseas. Thankfully, we haven't laid anyone off due to the crisis. We are still looking for 70 new staff, working across two shift patterns of two days on and two days off seven days a week.
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