Users of GSE need it to be as reliable and efficient as possible at all times, whether that equipment is owned or leased. There is a growing tendency for users to outsource their GSE maintenance, while another trend – the drive for ‘greener’ operations – is changing the nature of the business
“Maintenance is part of our leasing package,” explains Marc Delvaux, CEO at Brussels Airport-headquartered GSE provider TCR. “The customer gets a one-stop-shop service: GSE acquisition and financing, repair and maintenance and fleet management. The service always includes preventive maintenance schedules and the cost is included in the rental fee.”
The maintenance component of TCR’s full service rental offering is built on defined maintenance processes, accurate bill of materials, spare parts availability, trained technicians, state-of-the-art workshops and follow-up ICT systems.
Spare parts management is largely automated at TCR, with a real-time stock management system. Special attention is given to the most critical spare parts, and the firm has developed a network of preferred spare parts suppliers that allows rapid delivery when necessary. TCR’s extended workshop network throughout Europe makes rapid shipments possible should the need arise.
But according to Yves Crespel, director of customer service at France-headquartered GSE manufacturer TLD Group, the availability of spare parts needed to ensure that maintenance schedules are met represents a significant challenge in GSE maintenance these days – at least in some areas of the world. “In Europe or in the USA, it is easy to deliver parts within 24 or 48 hours because there are no Customs constraints. In other parts of the world, though, it can be difficult: you can send something out and when it arrives it can sit with Customs for several days or even weeks before being delivered.
“This links back to a bigger challenge – customers need to consider maintenance not just as a pure cost but rather as an opportunity for better equipment availability,” Crespel continues. “It’s a question of investing in existing equipment, using quality spare parts and maintaining it regularly, instead of buying or leasing two or three times more equipment than is really necessary.”
TLD Group supports its customers throughout the life cycle of its products, offering expertise and technical support beyond the warranty period – 365 days a year, 24/7. It has over 25 sales and service offices around the world, several spare parts hubs on all continents and strong relationships with parts suppliers.
Meanwhile, as well as offering GSE maintenance services to its own lessees, TCR is also able to assist those requiring maintenance services only. According to Delvaux: “Our priority is to serve our leasing customers to guarantee them at all times GSE availability and performance. However, when there is demand from a customer for maintenance only and in case of free capacity in our maintenance resources, we also provide maintenance for GSE not leased by TCR when possible.”
This is the case, for instance, for catering trucks at London Heathrow International Airport. TCR leases out 12,500 pieces of equipment under full service agreements (that is, leasing including maintenance) but also maintains 3,000 GSE items that are not leased.
“We will do our utmost to help any ground handler that needs unexpected help in any particular situation,” he informs.
The outsourcing model
Nowadays, there are far fewer ground handlers or airlines than before that manage their own GSE maintenance workshop. Delvaux notes that estimates suggest that throughout Europe only about 20% of ground support equipment is now rented through operational leasing agreements; this volume of equipment was probably self-maintained in the past, he believes. In addition, some of the big airlines have largely outsourced their maintenance in the last 15 years to independent parties.
Dewey Kulzer, director of Texas-based Elite Line Services (ELS – part of material handling company Daifuku Webb), considers: “Outsourcing of GSE maintenance services was around before the events of 11 September 2001 in New York, but 9/11 drove it hard, and really pushed our growth. We’re not seeing any tendency to bring it in-house at all. It’s not impossible for an airline to have its own efficient maintenance department but it’s not their core business, and it’s not easy to do.”
Ground handlers, too, are under constant cost pressure, so they want to focus on their core activity and outsource GSE maintenance to ease that pressure. Plus, Crespel points out that “it may be that ground handling agents are more concerned with making sure everything is done as per the specifications and legal documents, in order to qualify for ISAGO (the International Air Transport Association’s Safety Audit for Ground Operations) certification.”
In addition, providers of GSE maintenance services themselves face increasing demands to ensure reliability, safety, performance, flexibility, traceability and cost reduction for their customers. As Delvaux remarks: “On-time performance is a very important KPI (key performance indicator) for an airline. This, linked to continuous cost optimisation, puts a lot of pressure on the maintenance of GSE. There is in fact less GSE for the same availability rate expectation. Maintenance performance needs to be at its best in order to be able to answer today’s tough economical and operational requirements.”
With 15 years of experience and a network of 25 workshops, TCR claims to achieve a high level of GSE maintenance performance. This, according to Delvaux, is the result not only of the company’s experience but also of its awareness that the industry requires “significant investments, constant modernisation and compliance with rapid technological changes, local specificities and stringent regulations”.
“As always GSE maintenance is a changing industry and a continual challenge. To describe it as dynamic is an understatement,” comments Kulzer.
The drive for greener power
Besides these factors, environmental performance is also increasingly high on the agenda in GSE maintenance – as in pretty much any other industry these days.
Says Kulzer: “The alternative fuel drive was derailed by 9/11 but it’s starting – slowly – to get back on track now. People are buying electric, but there has been very little capital outlay until now. For example, at Seattle the airport has a drive to be as green as possible; but it’s a matter of cost, and deciding who’s going to pay for it. The new equipment we’re seeing is primarily electric; propane is also out there but people find that it’s very clean while the equipment is in a perfect state of maintenance, but if not it gets quite dirty.”
He goes on: “The biggest issue for us in this area is training our people. We have to make sure they are as technically able as possible so that they can switch from working on traditional equipment to electric equipment. We work with the manufacturers to develop training programmes.”
Among those switching to electric GSE is US carrier Spirit Airlines, which in March this year ordered 21 CorPower lithium-electric GSE retrofit kits for its Fort Lauderdale operations from lithium-ion battery manufacturer Corvus Energy.
The units will be supplied by Corvus’s North American distributor, Aviation GSE America, and will be used to convert the carrier’s entire fleet of baggage tractors at Fort Lauderdale – saving Spirit Airlines 25,000 gallons of gasoline a year and reducing carbon emissions by around 243 tons. Nitrous oxide and particulate emissions are also eliminated.
Spirit chief operating officer Tony Lefebvre points to the expected environmental benefits of the switch, but also notes: “At the same time, the Corvus product allows us to reduce our ground support costs by eliminating our fuel expense and reducing our maintenance expense on these tractors. The capital outlay is significantly less than going with new lead-acid electric tractors and the lithium charging infrastructure is less demanding on airport electrical infrastructure.”
Corvus says its batteries are “completely maintenance free”, and that the lithium-ion option lasts three to five years longer than lead-acid alternatives.
Kulzer admitted that there is usually a lower requirement for maintenance with electrically powered equipment as opposed to diesel. “Manufacturers all say the requirement is about 60 percent but I’d say it’s more like 80 to 90 percent. I’m not worried about our business shrinking, though – our name, Elite Line Services, reflects the fact that we are about providing top quality service and this will ensure our growth,” he affirms.
Electric equipment is easier to maintain because it does not use the fluids that conventional equipment uses. Therefore, it has a lighter maintenance schedule and the equipment is less costly to maintain. “We’re very well aware of this at TLD,” says Crespel. “We offer a full range of electric equipment, from hi-loaders to baggage tractors. This equipment requires different expertise but it doesn’t mean there will be no business for maintenance providers – it’s not maintenance-free. It just involves a shift in the competencies of technicians, and adequate training of staff,” he believes, echoing Kulzer.
As users seek to protect and improve their bottom line, GSE maintenance is changing. It is becoming “increasingly professional because it is a way to protect large investment value, to streamline operational reliability, to reduce overall costs and to build trust in the whole chain”, outlines Delvaux. “Indeed, good quality and well-maintained GSE is a key component of the value-added chain in the air transportation industry.
“TCR’s view is that the trend will increasingly move towards outsourcing of maintenance and fleet management in general to specialised GSE managers, which allows ground handlers to keep their focus, means and investment on the handling business and operations at all times, and not the technicalities of their production tools, the GSE. This is following the trend that is apparent in most other industries (such as construction, ICT, transport or real estate, for example).”
In addition, “GSE maintenance as a stand-alone service will no longer be compliant to our customers’ needs in the future – the customer’s expectations also include fleet management and capital expenditure on GSE,” says TCR chief operating officer Donald Meulebroek.
Other developments include an increasing demand for GSE that incorporates tracking systems – chips on equipment that can locate it and transmit data such as when it is due for a service – and a growing tendency for users to rely on maintenance software to follow up on their fleet and to plan maintenance or spare parts purchasing.
Plus, competition is increasing. Kulzer considers: “ELS has always been mainly in the aviation industry. Since 9/11 we’ve gone from seeing five bids for a tender to 20 bids. People from outside the industry are expanding into GSE maintenance, as are GSE manufacturers.” While Kulzer remains confident of ELS’s survival and prosperity, the company is not complacent; it is currently looking outside the US to expand into new markets.TCR, meanwhile, has already been expanding. In 2012, the company achieved important steps in Europe – more specifically, in Norway, Germany and Italy.
Its Norwegian operations started on 1 October 2012, when TCR set about renting all Oslo International Airport GSE to Aviator via a sale and rent-back system. The Norwegian operation has six full-time employees and is looking to expand further. The Scandinavian market already represents 5% of TCR Group’s activities and the company is seeing further potential within the region.
March 2012 saw the beginning of a sale and rent-back operation in Germany, at Düsseldorf International Airport, with Aviapartner. Going forward, the company has also been supplying additional equipment to Aviapartner in order to keep up with the airport’s growth. Delvaux reveals: “The company’s presence at the airport has led to the interest of a second ground handling partner, Düsseldorf Airport Ground Handling. TCR was also able to gain the sale and rent-back contract for this handler.”
Though new, the German operations make up 10% of TCR’s activities with a fleet of 2,000 GSE units. The company sees more potential there and has its eye on opportunities to expand into other airports across the country.
TCR has also branched into Italy recently, recognising the presence of a fast-growing market and high level of competition. To date, TCR is operating in airports in Naples, Rome and Milan.