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SIAEC group of companies have both CFM-Leap and Pratt & Whitney GTF engine capabilities.
Singapore’s rapid border reopening and the operational readiness of flag carrier Singapore Airlines have helped the country and its air transport industry bounce back from the depth of the COVID-19 pandemic. In the first half of 2024, passenger traffic at Changi Airport hit nearly 100% of 2019 levels, and SIA Engineering Co. has captured booming growth from its parent airline.
However, as with the entire MRO industry, SIA Engineering Co. (SIAEC) is faced with a range of headwinds, including supply chain disruptions, talent and labor constraints and inflationary challenges. On top of these are global geopolitical and macroeconomic uncertainties.
After 16 years at SIAEC, Wong Yue Jeen was appointed as chief commercial officer April 1 with an aim to expand the company’s capacity. “We see a lot of constraints [in] the supply chain and capacity and talent,” Wong tells Inside MRO from SIAEC’s newly renovated office. “But if I take a longer view, I still will look at a sustainable growth for SIAEC and the foundation of . . . how we build and optimize our capacity. I think we should see how we can increase our capacity to take in more work across the board, but at the right pace as well, and not to rush into overbuilding capacity.”
While the company has always prepared for planned events, Wong says it is critical to be ready to support customers for unscheduled events in a timely manner. SIAEC has seen an uptick in unplanned events, especially with numerous OEM issues such as Pratt & Whitney’s geared turbofan engine groundings and service provider capacity constraints, which have led to more work coming into SIAEC.
Wong did not reveal how much additional capacity the company plans for these events, but he says it has always prepared more resources than for planned events and, more important, has a good system to escalate situations like these.
The company also is starting to see longer aircraft visits to the hangar due to more work on older aircraft, paired with supply chain delays. Airlines are keeping older aircraft in service longer, too, as aircraft manufacturers take more time to fulfill backlogs and delivery delays.
“We see this as an opportunity for us to support the high demand for airframe capacity; hence, it ties in very well with our expansion plans in Malaysia,” Wong says. “We are already in a very strong position to continue to support the current leads because this is the capability that we already have today. At the same time, we have continuously invested in the new-generation fleets—for example, the [Airbus] A350s—so we are prepared [to deal with the demand] for both scenarios.”
SIAEC will lease two hangars at Sultan Abdul Aziz Shah Airport in Selangor, Malaysia, capable of handling four widebody aircraft simultaneously, making it the third base maintenance site in Asia. The lease will run for 15 years, with the option for 15 more.
India and China
One of the most important breakthroughs for SIAEC is the strategic partnership with Air India to build an MRO facility in Bangalore, which will involve the planning, construction, development and operationalization of widebody and narrowbody base maintenance hangars beginning in 2026.
While India is one of the fastest-growing aviation markets in the world, the country does not have MRO infrastructure or capacity to support the rapid growth.
Air India, which is undergoing a merger with AirAsia India and Singapore Airlines affiliate Vistara under the new Tata Group ownership, has invested in 470 new aircraft, including 210 Airbus A320neos, 40 A350s, 190 Boeing 737 MAXs, 20 787s and 10 777Xs. This serves as the foundation for future business opportunities in India for SIAEC.
“Tata is [familiar] with the regulatory and business environment, and I think that’s an important factor to be strong and be able to operate successfully in India,” Wong says, adding that the Air India-Tata group has solid leadership—some stemming from the SIA Group that contributes to the whole fabric.
SIAEC is in the preliminary stage of setting up the primary capabilities for Air India, enabling the flag carrier to possess MRO resilience.
On the China front, Wong says SIAEC is “late to the game,” with numerous players already having entered the country that is set to be the world’s largest single market. Nonetheless, there are still “pockets of opportunities” for SIAEC to explore, he notes. SIAEC signed a memorandum of understanding in September 2023 with Xiamen Iport Group to explore MRO opportunities in Fujian province.
Iport operates airports in Xiamen, Fuzhou, Wuyishan and Longyan, which Wong sees as untapped Tier 2 and Tier 3 cities for MRO work.
With this promising growth, SIAEC says it is still the right strategy to revolve its geographical expansion around the Asia-Pacific region.
Talent, AI and Skills
As capacity increases, the company continues to invest in and evolve its talent pool. While SIAEC has continued to see interest from new applicants, Wong says the challenge in the MRO industry is always retaining new hires for the long-term future.
“We feel very strongly that many of these people eventually want to see their career beyond the shop floor,” Wong says. “Hence, the reskilling and upskilling of people to go into areas such as operational support, planning, and even gaining some digital skill sets of continuous improvement . . . to lead other parts of the company’s operational and nonoperational areas.”
SIAEC has embarked on its so-called Lean principle, with more than 1,000 staff undergoing training so far to gain skills to identify problem statements and objectives for improvement. The aim is for the entire company to have an inherent culture of continual improvement and innovation.
SIAEC is dabbling with generative artificial intelligence (AI) in the form of its own closed ChatGPT system known as Newton, where staff can submit queries on large sets of data and derive trends and analysis.
Wong says that despite the ongoing trend in digitalization and AI, engineering skills will remain the bedrock of MRO operations.
“We cannot [ignore that] for a person to work in the hangar or engine shop, the basic skill set to be able to perform repair work must still be there,” he says. “Robots have not replaced the pair of hands to perform much of the repair work on aircraft. Similarly, a licensed engineer still has to certify and sign off on the work . . . not a robot or an AI machine.”
AI will instead help improve the efficiency of engineers and technicians, for example, by planning materials, predicting the scope of work when an engine or component comes in, and providing a clearer, defined scope of work.
“Over time, we need a newer skill set to apply these AI tools more effectively to support the shop floor,” Wong says. “A generational change will take place as more tools become available and easier to use, and we will also have to align the training to cater to these new tools and skills.”
