Deccan - Kingfisher want partner for MRO JV

Air Deccan and Kingfisher Airlines want to establish a maintenance, repair and overhaul (MRO) business in a joint-venture partnership with a third party, preferably a foreign provider. The new company would probably be around one-third owned by each of the partners and the foreign provider would manage the operation.

Air Deccan chairman Capt G R Gopinath said that the company was in talks with several parties, and was hopeful that a three-way deal could be finalised within a few months. Air Deccan and Kingfisher Airlines are willing to allow the operator to do third party work as well. But Air Deccan and Kingfisher have a huge fleet between themselves already apart from an even larger fleet in waiting, because of aircraft orders.

One of the names mentioned is local company Jupiter Aviation, which is Airbus parent EADS's partner in India, as one that talks are being held with. But discussions are bound to be complicated, as Jupiter has already agreed to establish an MRO joint venture with Indian Airlines, which has merged with Air India. Other possible partners are Lufthansa Technik and SR Technics.

Air Deccan is India's first low-cost carrier, having started in 2003. Kingfisher was launched in 2005, and is a full-service operator. Kingfisher's parent, the UB Group, recently acquired 26 per cent of Air Deccan and is to make an open offer to shareholders for up to 20 per cent more.

Air Deccan and Kingfisher had separately been mulling about setting up in-house maintenance capabilities. After becoming sister companies, they have been assessing opportunities to drive cost and operational efficiencies. Last year, Kingfisher was in talks with the government-owned Hindustan Aeronautics and an overseas partner to set up an MRO joint venture, but no deal was finalised.

Together, the two airlines operate around 75 Airbus jets and ATR turboprops and they have dozens  more on order. Kingfisher also has double-decker Airbus A-380 superjumbos on order. At present, international providers like Lufthansa Technik and Gulf Aircraft Maintenance maintain their aircraft and components.