Singapore Technologies Engineering Ltd (ST Engineering) today announced that its Aerospace sector has signed an agreement with a contract value of about US$600m (approximately S$813m) to provide aircraft heavy maintenance services to a major North American operator. ST Engineering will support the operator, an existing customer, on a fleet of over 160 widebody and narrowbody aircraft starting in 2020 for a period of 10 years.
Under the long-term strategic alliance, ST Engineering is able to offer a fleet reliability programme that monitors the health of each aircraft and recommend maintenance actions to address identified issues before they impact the airline's operational reliability. Continuous improvement initiatives over the duration of the programme will also help drive greater efficiency and shorter turnaround times during maintenance.
Mr Lim Serh Ghee, President of ST Engineering's Aerospace Sector, said, "We are delighted that this existing customer, whom we have worked closely with for many years, has decided to continue entrusting us with maintaining their aircraft, and take that relationship further by placing an additional aircraft type under our care. Long-term partnerships such as this allow us to build a deep understanding of our customers' needs to better support them as their fleet size grows."
ST Engineering will be providing airframe maintenance services to the customer at its US facilities located in San Antonio, Texas and Pensacola, Florida. The San Antonio facility is a well-established airframe MRO service provider which just received the prestigious Federal Aviation Administration Aviation Maintenance Technician Diamond Award of Excellence in 2018, while the Pensacola facility comprises a new hangar with state-of-the-art infrastructure that began operations in June 2018.
Both facilities are part of ST Engineering's global network of aviation facilities that count leading airlines and military aircraft operators among their clients. Its Aerospace arm is the world's largest commercial airframe MRO service provider, a leading position it enjoyed since 2002 based on a biennial ranking survey conducted by Aviation Week Network.
This contract is not expected to have any material impact on the consolidated net tangible assets per share and earnings per share of ST Engineering for the current financial year.