No grounding high-flying Clare aviation company

EMPLOYMENT in a Shannon aviation company will more than treble over a six year-period from this Friday when a new takeover of a neighbouring business takes off.

Atlantic Aviation Group (AAG) employs 320 in its existing hangar, 120 in its UK base and will take on about 300 new employees from Lufthansa Technik.

The new hangar, which is almost three times the size of the AAG building, can accommodate nine narrow body Ryanair sized aircraft or two wide body and four narrow body aircraft.

Back in April 2015, when investor Patrick Jordan bought the company it was employing about 217.

Revenue have grown from €15 million to a projected figure of €80 million by the end of the year, with AAG chief executive, Shane O’Neill expecting growth to more than €100 million over the coming years.

Barring some unexpected major setback, Mr O’Neill believes overall employment could increase up to 1,000 in a few years.

AAG services, maintains and repairs aircraft that require a four, eight or 12-year check. Engineers follow defined criteria to open up the aircraft, inspect what needs to be examined, repair or replace parts within specified standards under approval from the Irish Aviation Authority and other regulatory authorities.

This can take from seven to 30 days on Boeing aircraft depending on the scale of the maintenance and repair work.

The company has a design office that looks at new structures and modifications on aircraft that can be designed by their engineers and implemented by MRO technicians.

It also has a training institute that trains new technicians and a continuing airworthiness management that advise customers about maintenance plans that need to be done on their assets.

Last October, Mr O’Neill recalled AAG had to take stock of its overall business after about 18 months of Covid-19 and were fortunate they had identified the right strategy in the previous five years leaving the firm strong in cargo and passenger, with an agreed plan for organic and inorganic growth path.

Having acquired a new business defence contract in the UK, the company decided not to shed jobs even though maintenance work in their hangar reduced to a few hundred hours a day at one stage.

It bought Flybe Aviation Services, which had a maintenance hangar and had a contract with Airbus to maintain a logistics and transport RAF aircraft.

The A400M aircraft was used a lot during the pandemic to transport Covid-19 vaccines throughout the world and it helped to evacuate people from Kabul in Afghanistan last October when the United States of America announced it was withdrawing their armed forces from the country.

Winter months of 2020 proved to be very difficult when more than 40,000 hours of spare capacity was clocked up during the Covid-19 pandemic, which had a devastating impact on airlines.

The company availed of the Employment Wage Subsidy Scheme, which helped to cushion the impact of losses at the time.

Instead, the company invested in additional training to acquire new skills and improvement, which prompted a great response from the workforce.

Mr O’Neill recalled AAG was asked by Lufthansa in Germany if it was interested in participating in a strategic conversation. Lufthansa had announced a strategic review of its Shannon operation, which involved a sale, restructure or closure.

AAG expressed an interest in acquiring Lufthansa phenomenal facility on their doorstep, which is “the envy of aviation maintenance”.

It developed a business plan to develop four out of six lines of maintenance in Lufthansa and was selected as the approved acquirer over several months during intensive discussions with the Shannon and German leadership team.

Stressing this new acquisition was the best outcome for the region, Mr O’Neill recalled there was a real risk of almost 500 jobs being lost.

He pointed out extracting Lufthansa’s Shannon operation from its German headquarters was a massive operation as the Irish Aviation Authority had to approve this site, which was previously approved by the German Aviation Authority.

“It took a phenomenal effort on both sides of the runway to make this deal happen. There has been a huge buy-in from everyone so we can start this new business under AAG. Lufthansa were not going to give us their customer book so we had to go and find our own customers over the last six months. AAG is a major contributor to the local economy, having grown from 217 to 750. The new transition is very exciting to be involved in. Shannon is renowned for its aviation expertise and is an aviation hub.”

Asked if there is much crossover between the Shannon and UK hangars, Mr O’Neill recalled management in Shannon only started travelling over there last September due to Covid-19 restrictions.

“AAG are trying to get more people over and back between the two hangars. We are not sharing resources from a technical perspective but the type of work and they way we set up in terms of paperwork, planning and system processes would be quite similar.

“AAG have got three hangars in the group now. Hangar One (Lufthansa) has solved some of the challenges it had, Hangar Two (AAG) hasn’t solved some of its similar challenges yet and vice versa. The UK hangar has solved some of the challenges that are going to be in Shannon in terms of obtaining materials and logistics, so what can we learn from that.

“The narrative is how can get the best way to do business in all three hangars. All three hangars are performing well using their own operating model. We want to learn from each other.”