Aircraft firm flying high over new Thai deal
Waikato-based NZAero has signed a new “multi-million” dollar deal with a Thai firm that is expected to significantly boost its earnings and provide jobs for the wider aeronautical sector in New Zealand.
The signing yesterday afternoon (NZ time) came during Prime Minister Christopher Luxon’s visit to Thailand.
“It’s a big deal,” NZAero’s chief executive Stephen Burrows said in an interview from Thailand ahead of inking the agreement that supports Royal Thai Airforce operations.
It will involve NZAero in maintenance and servicing in Thailand and New Zealand, he said.
A statement from the company – this country’s only commercial aircraft manufacturer – said New Zealand’s aeronautical sector was set for a multi-million dollar export boost through the deal with Thai Aviation Industries.
The agreement, which expands an existing relationship, provides for the exclusive supply of parts to Thailand as well as maintenance contracts for the overhaul of dozens of aircraft engines annually.
Luxon was quoted as saying the agreement was “a great outcome on all fronts and I would like to congratulate NZAero on its success in Southeast Asia”.
In the statement, Burrows said Thailand’s government had launched plans to create a world-class aviation hub for the Asia-Pacific region. “The new multi-year agreement signed between Thai Aviation Industries ... and NZAero is set to triple the value of parts and maintenance exports to that market and help strengthen our relationship so that as their existing fleets are phased out, our new utility aircraft are seen as a viable replacement.
“The deal will see NZAero supply a range of over 800 parts for Thailand’s CT4 airtrainer fleet, for use in military training operations.”
The CT4 had been designed and made in Waikato. “Other Kiwi aviation repair firms will also benefit from regular maintenance contracts to overhaul engines. A single-engine could cost up to $100,000 to overhaul and Thailand has two dozen of these aircraft in use,” Burrows said.
While New Zealand had a 50-year history as an aviation supplier to Thailand, this was the first time an exclusive parts and service agreement has been formalised in this way, he added.
Burrows predicted the creation of dozens more jobs in New Zealand, saying significant expansion of the local industry could be on the cards.
Thailand was committed to defence force modernisation and allocated around $1.8 billion to its air force each year “presenting a significant opportunity for New Zealand to expand its share of a rapidly growing market”.
Burrows also hoped Thailand could use the company’s recently launched SuperPac XSTOL (Extremely Short Take-Off and Landing) aircraft.
His firm would look to meet with defence force decision-makers and private aviation operators in Singapore and the Philippines.
In the interview, Burrows said it was hard to quantify the expected extra value coming from the new Thai deal “because it’s a service contract”.
But “the Thai aviation industry is looking to expand”, he said, noting that NZAero was the original manufacturer of the parts to be used in servicing.