AirAsia eyes $500-million maintenance hub in the Philippines 

Malaysian-based Capital A Berhad, which operates leading low-cost carrier AirAsia, is planning to invest $500 million to establish a maintenance hub in the Philippines aimed at supporting the growing demand of East Asian airlines, according to a report by Manila Bulletin.

Capital A Berhad Chief Executive Officer (CEO) Tony Fernandes said the investment is rooted in the prospect of making the Philippines a strategic hub for the conglomerate’s maintenance, repair, and overhaul (MRO) arm, Asia Digital Engineering (ADE).

ADE, which was established by Capital A Berhad in 2020 to cushion the impact of the Covid-19 pandemic, currently offers services such as engineering maintenance, component and warehouse services, and engineering support.

Based in Malaysia, ADE serves the needs of AirAsia and 52 other airlines.

Last year, ADE unveiled the largest MRO hangar in Malaysia within Kuala Lumpur International Airport, with a capacity of 14 lines, capable of accommodating 14 narrowbody aircraft or a combination of eight narrowbody and two widebody aircraft.

Based on its website, ADE serves five other major airports in Malaysia, covering the areas of Langkawi, Penang, Johor Bahru, Kuching, and Kota Kinabalu.

Fernandes said they are now focused on an aggressive campaign to expand their services beyond the current base, with prospects already eyed in Thailand, Indonesia, and the Philippines.

With the planned $500 million investment in the Philippines, the facility is particularly eyed to serve airlines from South Korea, Japan, and China.

ADE is currently studying potential sites in airports in Manila, Clark, Cebu, and Bulacan, the site of the under-construction New Manila International Airport.

Fernandes said these airports, which are operated by the private sector, have offered land for ADE to construct the MRO facility.

The Philippine hub is expected to have a capacity of between eight and 10 lines, serving both narrow-body and wide-body aircraft.

The facility will likewise carry component overhaul, specializing in aircraft parts such as brakes, landing gears, and engines.

With talks already underway with government officials and private operators, Fernandes said the construction will likely begin by the end of the year, with its opening around 2027.

Poised to generate as many as 2,500 jobs, the airline magnate shared that plans are also in place to build an academy alongside the MRO facility to train and upskill engineers.

“We're not afraid of training people and building a fantastic business here,” he said in a press conference.