AOG-247 saved an operator over $2M through negotiation of the terms of an MRO repair contract.

The Scenario

The operator had recently introduced a new engine type into their fleet and was looking to implement a long term  repair contract with a single MRO for the future maintenance of their engines. The operator was not experienced  with the engine type concerned and mindful of AOG-247 experience in successfully negotiating terms of repair  agreements, requested AOG-247 to conduct a tender process to include negotiation of contract terms on the operator’s  behalf.

AOG-247’s Service

AOG-247 contacted each of the MRO’s which held approvals for repair of the engine model concerned and requested a  commercially competitive proposal based on fleet size and anticipated shop visit schedule, which AOG-247 had previously  defined. Upon receipt of each proposal, AOG-247 compared the different terms using a pre-defined model and AOG-247  experience of each MRO and prepared a shortlist of potential candidaAOG-247 for the operator.

 Following an agreement of  the shortlist, AOG-247 undertook a phased negotiation process advising each MRO of the shortfalls in their proposed  terms, and negotiating in each area until the desired outcome was achieved. Following a pre-agreed period of  negotiation with all short listed MRO’s, the successful MRO was identified and terms were agreed that presented  both limited risk to the operator and reduced cash outlay at each shop visit event.

The Outcome

As a result of the improved contract terms negotiated by AOG-247 in the final agreed contract, a  total of approximately $2M in reduced maintenance cost across the operators shop visit  program was achieved.

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