AAR announces extension and expansion of Alaska Airlines MRO relationship, expected facility expansion in Oklahoma City

Rhea-AI Summary

AAR CORP. (NYSE: AIR) extends airframe MRO services with Alaska Airlines through 2030 and plans to expand its heavy maintenance partnership. AAR will add a new three-bay hangar at Will Rogers World Airport in Oklahoma City, creating 200 additional careers and accommodating all 737 variants, including the 737-10.

Positive

• AAR's extended agreement with Alaska Airlines strengthens its position in the aviation services industry and showcases long-term partnership commitment. The expansion of the MRO services and facility in Oklahoma City demonstrates AAR's dedication to workforce development and community impact, aligning with the strategic MRO initiatives of Alaska Airlines.

Negative

• The project's funding reliance on a grant from the State of Oklahoma and rent concessions from Will Rogers World Airport may pose financial risks if the expected support is not obtained. Additionally, the commitment to creating more than 200 additional careers at AAR in Oklahoma City may lead to increased operational expenses and workforce management challenges.

The agreement is expected to bolster AAR’s workforce development efforts, benefiting both companies, the industry, and the Oklahoma labor market.

Wood Dale, Illinois, Dec. 07, 2023 (GLOBE NEWSWIRE) -- AAR CORP. (NYSE: AIR), a leading provider of aviation services to commercial and government operators, MROs, and OEMs, announced today it has signed an agreement to extend the Company’s existing airframe MRO services with Alaska Airlines through 2030 and expand its heavy maintenance partnership.

AAR has committed to growing its dedicated airframe narrowbody capacity to provide Alaska Airlines with a minimum of six lines of maintenance support. To support this, AAR plans to add a new three-bay hangar adjacent to its existing seven-bay facility at Will Rogers World Airport in Oklahoma City, pending final approval by the Oklahoma City Airport Trust.

The proposed new hangar will provide AAR an additional 85,000 square feet of MRO space to accommodate all 737 variants, including the 737-10. The project is anticipated to be funded by a grant from the State of Oklahoma, as well as rent concessions over time from Will Rogers World Airport.

The facility expansion is projected to create more than 200 additional careers at AAR in Oklahoma City, which the Company expects to fill through its robust workforce development initiatives.

“AAR has supported Alaska Airlines for more than 20 years, and we are eager to continue deepening our partnership with AAR,” said Don Wright, VP Maintenance and Engineering of Alaska Airlines. “AAR’s facility expansion aligns with our strategic MRO initiatives related to our growing fleet of all Boeing 737 variants.”

“Alaska Airlines is our longest-tenured Airframe MRO customer. We are exceptionally proud of our long history together,” said John M. Holmes, Chairman, President and CEO of AAR. “Like the expansion we announced in Miami this summer, our planned Oklahoma facility expansion will create opportunities to enhance our positive impact on the community by creating additional careers in aviation. We are thankful for the support of partners like Oklahoma City Airport Trust that help make this possible.”

For more information on AAR, visit aarcorp.com.

About AAR
AAR is a global aerospace and defense aftermarket solutions company with operations in over 20 countries. Headquartered in the Chicago area, AAR supports commercial and government customers through four operating segments: Parts Supply, Repair & Engineering, Integrated Solutions, and Expeditionary Services. Additional information can be found at aarcorp.com.
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About Alaska Airlines
Alaska Airlines and our regional partners serve more than 120 destinations across the United States, Belize, Canada, Costa Rica and Mexico with new service to the Bahamas and Guatemala beginning in December. We strive to be the most caring airline with award-winning customer service and an industry-leading loyalty program. As a member of the oneworld alliance, and with our additional global partners, our guests can travel to more than 1,000 destinations on more than 25 airlines while earning and redeeming miles on flights to locations around the world. Learn more about Alaska at news.alaskaair.com and follow @alaskaairnews for news and stories. Alaska Airlines and Horizon Air are subsidiaries of Alaska Air Group.

This press release contains certain statements relating to future results, which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995 which reflect management’s expectations about future conditions, including expected activities and benefits under the extended and expanded services agreement; the approval, funding and completion of the expansion of the Company’s facility at Will Rogers World Airport in Oklahoma City; and the creation of careers in connection with the expansion. Forward-looking statements may also be identified because they contain words such as ‘‘anticipate,’’ ‘‘believe,’’ ‘‘continue,’’ ‘‘could,’’ ‘‘estimate,’’ ‘‘expect,’’ ‘‘intend,’’ ‘‘likely,’’ ‘‘may,’’ ‘‘might,’’ ‘‘plan,’’ ‘‘potential,’’ ‘‘predict,’’ ‘‘project,’’ ‘‘seek,’’ ‘‘should,’’ ‘‘target,’’ ‘‘will,’’ ‘‘would,’’ or similar expressions and the negatives of those terms. These forward-looking statements are based on beliefs of Company management, as well as assumptions and estimates based on information currently available to the Company and are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated. For a discussion of these and other risks and uncertainties, refer to “Risk Factors” in our most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q. Should one or more of these risks or uncertainties materialize adversely, or should underlying assumptions or estimates prove incorrect, actual results may vary materially from those described. These events and uncertainties are difficult or impossible to predict accurately and many are beyond the Company’s control. The Company assumes no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

FAQ

What is the latest agreement announced by AAR CORP. (NYSE: AIR)?

AAR extends airframe MRO services with Alaska Airlines through 2030 and expands its heavy maintenance partnership.

Where will AAR add a new hangar and how will it benefit the company?

AAR plans to add a new three-bay hangar adjacent to its existing seven-bay facility at Will Rogers World Airport in Oklahoma City, providing additional MRO space to accommodate all 737 variants and creating 200 additional careers.

How does the expansion align with Alaska Airlines' strategic MRO initiatives?

The expansion aligns with Alaska Airlines' strategic MRO initiatives related to their growing fleet of all Boeing 737 variants.

What is AAR's commitment to workforce development in Oklahoma City?

AAR expects to fill the 200 additional careers through its robust workforce development initiatives, strengthening its impact on the community.

What are the potential financial risks associated with the project?

The project's funding reliance on a grant from the State of Oklahoma and rent concessions from Will Rogers World Airport may pose financial risks if the expected support is not obtained.