SIA, P&W to form engine overhaul joint venture<\/p>\n
SINGAPORE (Reuter): Singapore Airlines (SIA) and Pratt &
\nWhitney (P&W) have agreed to form an engine overhaul joint-
\nventure to tap opportunities in the Asia-Pacific region, senior
\ncompany officials said yesterday.<\/p>\n
P&W, a unit of U.S.-based United Technologies, will own 51
\npercent of the venture with SIA Engineering, a wholly-owned
\nsubsidiary of SIA, holding the balance.<\/p>\n
The initial focus of the joint venture would be on the PW4000,
\nJT9D and the CFM56 engines, all which are currently used to power
\naircraft in the SIA fleet.<\/p>\n
The venture would be P&W's exclusive overhaul facility in Asia
\nPacific and the Indian subcontinent, James Taiclet, vice
\npresident of P&W Eagle Services, told reporters after the signing
\nceremony for the venture.<\/p>\n
"We expect over US$200 million in revenues a year in 1998 and
\nby 1999, it would be up to $300 million," he said.<\/p>\n
Chief executive of SIA Engineering Robert Tan said the venture
\nwith P&W will give it access to the most advanced technology in
\nthe engine overhaul businesss.<\/p>\n
"Given Pratt & Whitney's technological prowess and marketing
\nreach, this joint venture with them will allow us to grow at a
\nmuch faster rate, and secure a much larger share of the engine
\noverhaul market, than we could achieve on our own," he said.<\/p>\n
SIA Engineering's current revenue, which will be transferred
\ninto the venture, is about $185 million.<\/p>\n
"We will grow the business overtime...we plan to bring in
\nbusiness from other airlines into the venture," Taiclet said.<\/p>\n
Initially, SIA will contribute to about two thirds of the
\nbusiness but this should eventually be reduced to half as
\nbusiness from other airlines increase.<\/p>\n
Taiclet said the Asia Pacific market for engine overhaul
\nbusiness in the three engines covered in the venture is worth
\nabout $600 million a year.<\/p>\n
The yet to be named venture, expected to start in November
\n1997, will have a team of about 650 people mostly from SIA
\nEngineering, he said. P&W will also bring in three to six staff
\nfor top management positions for the venture.<\/p>\n
Both companies will have scope in the future to add other
\nengines into the venture if there "was an economic opportunity",
\nhe said.<\/p>\n
"The best part of this joint venture is that it is
\nindependent. It works for the best interest for the two
\ncompanies," he said.<\/p>\n
Taiclet also said the venture will effectively double P&W's
\nengine overhaul revenues.<\/p>\n
In addition, P&W will look to set up another engine overhaul
\nventure in Europe to service customers in Europe and the Middle
\nEast region, he said.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/sia-pw-to-form-engine-overhaul-joint-venture-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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