Wed, Jun 20, 2007 - Page 11 News List

Growth in PRC aviation outrunning training

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China's aviation industry, the fastest growing worldwide, may be held back by a lack of qualified maintenance workers, according to Hong Kong Aircraft Engineering Co (HAECO, 香港飛機工程) chief executive officer P.K. Chan (陳炳傑).

"The point isn't how many hangars you can build, it's how many people you can train," Chan said in interview in Xiamen on Wednesday last week.

Taikoo (Xiamen) Aircraft Engineering Co (TAECO, 廈門太古飛機工程), which is 57 percent owned by HAECO and is also the world's second-largest third-party airplane maintenance provider, opened a fifth hangar in the southern Chinese city last week.

About 10 percent of the workers at the HAECO unit were poached last year, according to Chan, as rivals and airlines build maintenance centers and other companies seek engineers.

Maintenance providers are expanding in China because the nation's commercial fleet will likely more than double to 2,666 by 2025, according to Airbus SAS.

China's need for aircraft engineers has "become more urgent simply because of its growth rate," said Ian Thomas, a consultant at the Centre for Asia-Pacific Aviation. "Wages are a key point as far as the future is concerned."

TAECO has already begun building a sixth hangar, due to open in 2009, because of surging demand for maintenance work and freighter conversions. The company converts Boeing Co 747 passenger planes into all-cargo aircraft for customers including Nippon Cargo Airlines Co and Cathay Pacific Airways Ltd.

TAECO plans to double the size of its training center and to offer courses to Chinese airlines and maintenance companies in order to boost the number of engineers in the market, chief executive officer Merlin Swire said in an e-mailed response to questions.

TAECO employs 4,800 workers. About 400 were poached last year, Chan said. He declined to comment on wages.

Boeing, Cathay Pacific and Japan Airlines Corp all own a 9.1 percent stake in TAECO.

Deutsche Lufthansa AG and Air China Ltd's maintenance venture is spending 3.5 billion yuan (US$460 million) on a 15-year expansion plan including the construction of Asia's two largest line maintenance hangars at Beijing's airport. Boeing, Shanghai Airport Group Corp and Shanghai Airlines Co are also building a US$85 million maintenance center in Shanghai.

Separately, Taiwan's China Airlines Ltd (中華航空) said on Wednesday last week that it was planning to buy an 8 percent stake in Chinese aircraft maintenance company Taikoo (Xiamen) Landing Gear Services Co (廈門太古起落架維修服務) for US$1.11 million.

The investment is aimed at improving China Airlines' ground maintenance capacity, the company said in a filing to the Taiwan stock exchange.

Taikoo Landing Gear is 50.2 percent owned by HAECO, according to the company's Web site.

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