Dornier Technology seeks new markets for expansion

(Conclusion)

In growing the Philippine maintenance, repair, overhaul (MRO) market, Dornier Technology is looking internally and outside the country to service the needs of the Asian regional market, according to CEO Nickos Gitsis.

“We’ve been committed to Clark, although there’s other possibilities also with the developments of other airports. There are other airports that have asked us to set up in their areas, such as Cebu in Mactan. That’s a possibility also to expand into that area eventually,”Gitsis said.

Gitsis indicated that “could be part of a future option because there is quite some activity now out of Cebu.” “But again, Clark has a developed import/export hub. To do MRO, you need a very robust and well-supported logistics infrastructure, which Clark has. They have the import and export in Clark, the special incentives and customs support to be able to service planes. In other countries they give very special incentives to MROs to do the required import and export of aircraft parts, with special duty like what Clark has.”

The Philippines, which is located in Southeast Asia, is also close to Northeast Asia like Japan, Korea, Taiwan and even China.

I asked him if he sees any potential to develop their business to service Japanese, Korean, Taiwanese and even Chinese aircraft as an alternative to flying further to the Middle East or Europe, which can be an eight- to nine-hour trip, as opposed to the Philippines which is just a four- to five-hour distance.

Gitsis replied, “We definitely have a Korean approval already to do base maintenance. Korea is definitely on our radar. Taiwan could be one, but we’re going to be looking to get the Chinese accreditation also next. That is a low-hanging objective of ours. We want to engage more with Chinese carriers and Chinese MROs. The Philippines has one of the lowest cost bases in all of Northeast and Southeast Asia.”

He continued, “So there’s the proximity. The Philippines is close to all of Southeast Asia, and we’re within four hours within almost every country of Eastern Asia. The Philippines has a big advantage. Compared to a company in Indonesia (which) is maybe eight hours away or nine hours away from Japan, for example. We don’t have that challenge. So if you’re within two to four hours, it’s still viable to fly a plane a couple of hours for maintenance. It’s not too far, but the flight at eight hours, it’s long. It’s a lot of expense. So being where the geolocation of the Philippines is strategically an advantage for an MRO business here.”

Another interesting aspect of Dornier Technology’s MRO expansion plan is that while Japan, Korea and Taiwan are big aviation markets and have big established airlines, they have an aging population and are experiencing a shortage of maintenance technicians and engineers. The Philippines, on the other hand, is the opposite, with a young population.

Gitsis clarified, “It’s not a shortage of people who want to go into that, but there’s a shortage of highly experienced personnel. That’s the challenge in the Philippines. And then the challenge is also keeping the people in the Philippines.“

But Gitsis has also observed that “there’s the reverse also, people who have left, they’re also looking for ways to come back. And that’s why developing this type of industry will bring many of those experienced technicians and engineers and mechanics back to the Philippines, because as jobs and opportunities come up here, we need the experienced people and we need people that have know-how to help guide the younger batches of technicians. At the same time, Dornier is developing a type of academy which we take graduates and indoctrinate them, and does apprenticeship programs with them. And that’s been working out great for Dornier. So that’s one of our pipelines for manpower.”

Tourism, aviation pioneer

Gitsis, who is an American, came to the Philippines when he was just 25 years old, together with German Iren Dornier. They co-founded SEAIR Inc, (South East Asian Airlines) in 1995.

Gitsis basically fell in love with the Philippines, got married here and has raised his children here. He has helped pioneer the development of now prime tourist destinations along with Tommy Lopez of Pampanga, and has been involved in the Philippine aviation sector with Archibald “Archie” Po, who used to operate Lionair and Asian Spirit.

Gitsis recalls, “I came when I was 25. So my whole career, I learned everything here. I learned how to fly outside the Philippines, but I developed my career and my business. Everything is here. My family’s here, my wife, my kids are Filipino. I may look like a Caucasian on the outside, but my heart is already Filipino.”

He continues to invest in the Philippines, stressing that “There’s no other way for us. This is it. We did the first 25 to 30 years of our aviation mostly focused on passenger aviation, but since we sold SEAIR and Tiger Air to Cebu Pacific in 2014, we diversified, or the group, the company. We took the components of SEAIR that were not part of the sale and we have been developing them for over 10 years now, and it’s been a very challenging time, and because in the middle of all that came COVID. But now we have this MRO and this FAA and all of that, and that looks very promising.”

Gitsis is hopeful “that Dornier Technology can become an important part of leading the way for MROs in the country, together with the bigger ones of course, the ones that I mentioned, whether it’s (Cebu Pacific’s) A+ or Singapore Airlines Engineering and Lufthansa. Those guys are true pioneers in MROs, but we’re really an independent MRO here in the country. “