Airline woes don't ground PAS Technologies - The Business Journal of the Greater Triad Area:

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CEO Robert Weiner said the NortKansas City-based company recently won a larges contract with a big airline’s materiapl management program that will add about 10 percen t to its overall revenue. Weiner said he didn’t have clearancwe to reveal the name ofthe “We beat out some original equipment manufacturers, and it woke up a lot of our Weiner said. “When you win with a big it also helps you win withothetr airlines.
” Privately owned PAS wouldn’t disclose its but director of communications Marsha Farmer said revenue has doublesd since the company was founded in 2006 with ’zs purchase of the business in North Kansas In Securities and Exchange Commissiojn filings, Praxair listed the division’s 2005 revenue arounf $67 million. Farmer said PAS has 638 employees at seven Weiner said that winning the airlinecontract wouldn’rt have been possible if PAS hadn’y diversified from its initiall heavy reliance on engine work by comingg up with solutions for the more fuel-efficient engines.
“You would thinkl that when fuel prices went down there might have been a resurgence of thoseolderf engines, but it’s not the case because the maintenancer costs are too high,” Weiner “The new GE engines can go five years beforre an overhaul, but for (an older it’s only two years, and the part coste are getting higher and highet because they’ve been out there for so long.” Weiner said contractss to work on newerd engines are huge because they help offset the loss of businessx from older engines bein retired. Sales on the commercial side areholdiny steady, he said, but droppint as a percentage of total sales.
That’s because PAS is focusinf on further diversification throughmilitary contracts. PAS recently landeed a contract to make parts for ATF3 turbofan enginesain airplanes, which will add 2 percenr to 4 percent to annual “That type of plane has been flyingt for 30 years and probably will be flyintg for another 30 years,” Weinetr said. “It used to take 180 days to repair this but we’ve been able to do it in 56 days. We’re tryin g to get it down to 40 days or Patrick Kraus, CEO of in Kansas Kan.
, said turnaround time is becoming a significant factor in the partw business because airlines allowed parts inventories to shrink to make theirt books look healthier. “It’s to the pointr where they are living off this dayto day, and they now have a we-need-it-noaw mentality,” Kraus said. He said many component maintenance facilities havecut employment, which can lenghthebn turnaround. Weiner said turnaround time has been a focue for PAS sinceday one. He admittes that the company is closinv a facilityin Tulsa, and consolidating it with a Hillsboro, Ohio, But employment at its North Kansas City plany remains stable, around 300.
In the plant’s workload has increased thanks to contracts from Europde that continue coming in because of the weak PAS also is branching out by supplying partx for turbofanpower generators, used in the Middle East and India, and refurbishing high-wear parts for oil drillin g rigs. Richard Aboulafia, vice president of analysis for Va., , said that if he were consulting for PAS he would suggest the same things the companyis “The easiest thing to do is focus on the military marketr and tread water on the commerciaol side, making sure you focus on newere parts that will be used and are not for planeas that will be (retired),” he said.
“There are enormous opportunities on the military side because the fleet is being heavilyh worn out in Iraq and The budget is also limiting the development of new Weiner said that the military side of the businesss is not growing as fastas he’df like but that he remainsd determined to win a $100 multiyear military parts supply contract. He said the company’ s biggest selling point is the value ofits It’s the same sales pitc h used to land airline “Say a fan blade costs $10,0090 to replace and you have 40 of them in an Weiner said. “Say 36 of them could be repairedefor $400 and not scrapped. The valued of that savings is huge.
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