[From the Scene] Incheon Airport draws MRO cluster blueprint

EVERETT, Washington -- Despite growing fears on plane defects worldwide, Boeing is relentlessly assembling 24 new aircrafts at its one-roof factory in Washington.

At its Everett factory -- the world’s largest by size at 13.38 million cubic meters -- the firm’s wide-body 747, 767, 777 and 787 planes are being assembled by humans, robots and cranes.

Robots bring the carbon fiber components for the B777X and fasten them together. They work by going underneath the components, whereas assembling by humans is done by placing the fleet body bellyside-up and then flipping it over, as it is easier to work facing downward instead of drilling up to the ceiling, the company said.

Boeing’s technical know-how, with decades of experience in manufacturing and the capacity to produce hundreds of airplanes, could soon be located at South Korea’s Incheon International Airport, according to officials, stressing its drive to expand maintenance, repair and overhaul services for commercial planes. 

Incheon airport is the world’s top service provider and the third-largest cargo terminal -- processing 800,000 tons annually. But when it comes to fleet maintenance and repair services, it is still in its infancy.

Its operator Incheon International Airport Corp. is aiming to push for the construction of an MRO complex as part of its level-four construction plan by 2023. This involves expansion of Terminal 2 and establishment of new runways, as the airport deals with more than 1,000 aircrafts daily.

Last year, IIAC secured a 1.6 million-square-meter plot of land near the airport on Yeongjong Island for the MRO complex. 

It has been seeking to build an MRO cluster for years to attract local and foreign companies related to aviation maintenance and flight training, as well as to contribute to the growth of the regional economy, IIAC said, adding that manufacturers like Boeing could be partners for such a grand project.

The lack of aircraft maintenance services at Incheon airport, which has led to heavy reliance on foreign outsourcing, means aircrafts have to be sent to MRO bases overseas. Each year, outsourcing reportedly costs the government some 4 trillion won ($3.4 billion). 

Aviation experts point to the geographical advantage of the airport, if an MRO cluster is established. 

Bob Bellitto, sales director at Boeing, told Korean reporters that Incheon is an ideal location for an MRO cluster, while working together with local firms will create synergies to offer competitive prices and product quality. 

He also added that government’s policy support is crucial when it comes to MRO complex operation, and part of that support could be creating a tax-free zone inside the cluster, such as by designating it as an economic zone to attract more foreign investments. 

MRO is a crucial sector for aviation sector, as it ensures the safety of aircrafts. Market data shows a rough cost of $10 million per fleet for MRO operations. 

Aircraft manufacturers like Boeing design and assemble models in order to trim maintenance costs. Components are becoming more reliable, sophisticated and detailed, creating a huge opportunity for the growth of MRO market.

Korean Air, the country’s largest full-service carrier, runs its own MRO unit that mostly covers its own fleet. Demand for such services in Korea is estimated at around 2 trillion won, according to local reports quoting surveys conducted by global research houses.

The Aeronautical Repair Station Association data shows that across the world, the MRO market for commercial planes will grow to $86.8 billion by 2024. Much of that growth is expected to come from Asia, where air travel via low-cost carriers has been expanding rapidly.

In that context, Boeing set up Boeing Shanghai Aviation Services in 2006, forming a joint venture with the Shanghai Airport Authority and China Eastern Airlines. 

At Boeing Shanghai, it not only offers MRO services based on its skills and know-how as an original equipment manufacturer, but also works on a range of services from training programs, engineering, aircraft maintenance and modification to component repairs and overhaul and supply chain management of its 737, 767, 777 and 747 models.

By Kim Da-sol, Korea Herald correspondent
(ddd@heraldcorp.com)