Aircraft maintenance, repair and overhaul service (MRO) provider GAL said it secured a Dh11 billion ($2.9bn) contract from the UAE Air Force and Air Defence (Afad).
GAL, a unit of UAE defence conglomerate Edge, will provide Afad with specialised MRO solutions under a three-year, performance-based logistics (PBL) contract, the company said at the Dubai Airshow on Sunday.
The PBL arrangement allows military customers to seek aviation MRO services organised under a cost per flight-hour model and also allows for ongoing improvements.
The contract "underscores our performance excellence and reliability as one of the region’s leading MRO service providers", GAL vice chairman Sheikh Mohammed bin Hamad said.
The company, which offers service to both military and civilian customers, said the agreement will support Afad with its "operational readiness while providing comprehensive safety and flexibility".
The agreement, the first such deal for the company, will also help it to establish it as one of the Middle East’s top aviation MRO services provider and will also streamline Afad's processes, align synergies and optimise manpower.
Defence spending in the six-member GCC economic bloc is expected to recover to pre-coronavirus levels by 2024 after declines that began this year due to the impact of the Covid-19 crisis, defence intelligence specialist Janes said in a report in February.
The strong economic bounce back is expected to support the sovereigns’ defence expenditure as revenue increase, the report said.
GAL is also opening the first regional distribution centre for aircraft logistics in Abu Dhabi in partnership with the China National Aero-Technology Import & Export Corporation, China's state-backed defence contractor, it said separately on Sunday.
The new Middle East and Africa Distribution Centre (MEADC) will significantly improve the availability of aircraft spare parts in the UAE and the wider Mena region.
“This collaboration is a testament to GAL’s competitive efforts to expand our presence and provide streamlined solutions to complex supply chain and MRO requirements,” said Khalid Al Breiki, president of Mission Support at Edge and managing director of GAL.
GAL understands the challenges posed by spare parts distribution and the regional distribution centre will “significantly improve access to these essential elements, as well as increase productivity and reduce complicated logistics, which arise when co-ordinating with international vendors”, he said.
Halcon, another Edge Group unit entity that specialises in the production and supply of precision-guided weapons, also said it has achieved of a “series of major developments for its SkyKnight air defence missile system”, including the completion of the system’s naval missile concept design, it said.
Halcon first unveiled SkyKnight, at the International Defence Exhibition in Abu Dhabi in February. It is the first UAE-designed and manufactured counter-rocket, artillery and mortar missile system, which is intended to counter the full spectrum of modern threats, the company said on Sunday.