NEWS: American Airlines Looks for Profit in Maintenance

On the heels of my post on outsourcing maintenance comes news that American Airlines is looking to position its massive Tulsa maintenance facility as a profit center. Airline management and the union workers are looking to streamline the operation and reduce costs. The point is to compete on a level playing field with the 3rd party maintenance facilities that are waiting in the wings. The idea is not novel, nearly every major airline with a large investment in maintenance staff and facilities has tried this at one point or another. None had any lasting success with turning those money sucking cost centers known as maintenance into wonderlands of profit. But this should not dissuade American Airlines from trying it.

Just because no major airline has ever managed to evolve their maintenance division into a profit center does not mean that American can't do it now. The prognosis for the labor force at American is grim. Find a way to compete with 3rd party maintenance or lose your job to them. That's hefty motivation. But the labor force should feel good that the airline is committing the resources to the effort. It would be just as easy to start using 3rd party maintenance.

Timing may work in their favor as well. The increased interest in 3rd party maintenance is going to soak up existing capacity. Now American has the opportunity to become a provider and offer up some 3rd party capacity. All they need to do is find a way to compete.