LOTAMS continues development of an aircraft maintenance base at Rzeszów-Jasionka Airport

LOT Aircraft Maintenance Services (LOTAMS) is continuing works related to the construction of a modern service base - hangars for narrow and wide-body aircraft at the Rzeszów-Jasionka Airport. Information about the start of the investment process was officially disclosed in October 2019 during Congress 590 by Aleksandra Juda - President of the Board of LOTAMS.

Dynamic growth in the aviation industry and huge demand for MRO services (maintenance, repair and overhaul) were forecast then. Although the current situation caused by the coronavirus epidemic changes these forecasts, the LOTAMS investment is included in the Company's long-term development strategy and is being continued. The investment of LOTAMS and Polish Aviation Group will be one of the most significant in the aviation industry in Europe - confirms Aleksandra Juda, President of the Board of LOTAMS.

Aviation was grounded literally overnight. Restrictions aimed at minimizing the number of cases of COVID-19 result in a decrease in demand for air transport services. This will translate into the financial situation not only of the airlines themselves, but also of companies such as LOTAMS. Changes in the aviation market are inevitable. The Rzeszów Airport not only wants to rebuild its pre-pandemic position in terms of passenger traffic, but also continues to diversify the Company's revenue sources - said Adam Hamryszczak, president of Rzeszów-Jasionka Airport. Everything points to the fact that only the strongest players will survive on the aircraft maintenance market, which is why we are pleased with the progress in the implementation of the LOTAMS base project in Jasionka.

Forecasts determining the time of return of aviation to the state before the epidemic are not certain due to the lack of sufficient data on the virus itself, needed for econometric models. Finding effective treatments or inventing a vaccine will be most important for the economy to recover, bringing among others increase in air connections. Unfortunately, we will feel negative effects in the near future. That is why we make optimal decisions in a broader economic aspect. The economy is developing in the cycles of prosperity and crisis. An outbreak of coronavirus will cause economic slowdown, possibly leading to recession for a short period. In such a situation, development of activities stimulating the economy is priority. The investment in Rzeszów is the best example of this. We cannot stop it, because it would mean giving up counteracting the negative effects of recourse in the aviation industry and the loss of funds invested - adds Aleksandra Juda.

Grounding air communication will have serious economic consequences not only for operators but also for other branches of aviation: handling operators, OEM suppliers and MRO service providers to which LOTAMS belongs. With this in mind, proactive management models should be developed by the companies for the period of economic stagnation and for the time of re-development. Hence, it will be necessary to introduce optimization processes and savings, and on the other hand to maintain staff and service capabilities - investment in Rzeszów is precisely the possibility of operating at the time of recovery from the crisis.

LOTAMS belongs to the leaders of the MRO industry. It is a brand that is valued and known globally, as evidenced by numerous inquiries coming to us from around the world. And I'm not just talking about the period before the outbreak. Even now, we are receiving inquiries for servicing wide-body passenger aircraft in 2021-2022. Airlines, when resuming their operations, won’t do it immediately in 100%. They will strategically select their fleet by selecting aircraft that will be less costly to maintain. These will be newer generation machines with less maintenance requirements, but still requiring it. The investment in Rzeszów is a tailor-made product adapted to support modern aircraft models. Most importantly it is a strategic investment for the Polish economy. Ultimately, we will employ 1,500 employees in Rzeszów within a decade. Our project will be a priority development factor and will contribute to increasing the investment potential of the Podkarpackie region - Marcin Kwietniak, Director of the LOTAMS Sales and Marketing Office.

At the beginning of April 2020, LOTAMS selected a Contract Engineer and signed a contract with SAFEGE S.A.S., which provides its clients with services in the field of design and investor supervision as well as their investment management. The Contract Engineer has started the process of obtaining consent for environmental conditions for the implementation of the project and initiates subsequent stages of the investment process.

The first stage of building the aircraft maintenance base is at an advanced stage. The Company received support, not being public aid from the ERF (Enterprise Restructuring Fund), for the implementation of the investment. Last year, a preliminary contract was signed for the purchase of real estate from the manager of the Rzeszów-Jasionka Airport (EPRZ).

The functional concept of the database has already been developed (authors are Alton Aviation Consultancy and Ghafari Associates).

On April 15, 2020, the Civil Aviation Authority issued a decision authorizing major operational and technical changes in the features of the Rzeszów Jasionka Airport (EPRZ), consisting of changing the airport border, location of the airport fence, border of the airport aviation part and patrol route. This is in line with the assumptions of the project and the preliminary purchase agreement for the property, concluded between the managing body of the Rzeszów-Jasionka Airport, LOTAMS and Polish Aviation Group.

This year in May the purchasing procedure has been started the selection of the designer - the works are very advanced.