Lufthansa Technik, GMR Group MRO deal falls through
30 Jun 2008
Deutsche Lufthansa AG may have suspended plans to set up a maintenance, repair and overhaul (MRO) joint venture with the GMR Group, according to report in the Frankfurter Allgemeine Zeitung. The report cited an unidentified spokesman at the airline's Lufthansa Technik unit.
According to the report, the Cologne, Germany-based carrier has ''adjusted'' plans because of the ''general market development,'' and the consolidation in India's aviation industry.
The venture was slated to become the first international MRO business in India, the newspaper added.
The GMR Group may now be talking to some leading Asian carriers for the proposed MRO.
Only last week reports had emerged stating that a deal between the two parties would be in place by the end of the year. (See: Lufthansa Technik to launch MRO facility in partnership with GMR Group)
The deal aimed to ready the MRO facility by this year-end, with Lufthansa Technik contributing 75% of the investment and the Indian infrastructure major the rest.
The report also suggested that since Lufthansa Technik already had a captive customer (Jet Airways' Boeing fleet) there would be assured business.
For some reason the deal has now fallen through. Industry observers say that a cost-hostile environment may be responsible for the collapse.
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