AA Parent to Invest in Maintenance Unit 9:55 AM CDT

By Suzanne Marta, The Dallas Morning News

Mar. 29–The parent of American Airlines Inc. said Thursday that it would invest up to $100 million in its maintenance services group to help expand its third-party aircraft maintenance business.

Officials said the investment by AMR Corp. will help give American an edge as it seeks additional business. Some of the $100 million will be used to update and possibly expand maintenance facilities, invest in new technology, and improve efficiency.

The investment is part of the company’s efforts to generate additional revenue, and “open the door for even more customers to experience our world-class, state-of-the-art technical services in a very competitive environment,” said Bob Reding, who oversees American’s technical operations.

“We have an extraordinary opportunity to take our maintenance services to the next level,” he said.

During the last three years, the carrier has worked with the union representing its maintenance employees to cut costs and keep most of American’s aircraft maintenance in-house.

American generated almost $95 million in third-party revenue in 2006 and hopes to achieve its goal of $175 million by the end of 2007, not including $225 million of engine overhaul work performed for customer airlines by Texas Aero Engine Services Limited, a joint venture between American and Rolls-Royce.

American’s maintenance and engineering services are offered throughout the airlines network and at its maintenance bases in Fort Worth, Kansas City, Mo., and Tulsa, Okla.

The investment is the latest signal by American that its business is back on firm footing after five years of losses.

On Wednesday, the airline said it would move up delivery of 47 Boeing 737-800 jets by four years as a first step in retiring its fleet of 325 narrow-body MD-80 jets.

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Copyright (c) 2007, The Dallas Morning News

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