GSE buyer: Moscow Domodedovo Airport
Posted Date: 05/03/2010
Issue: Airside International March 2010
Publication: Airside International
Moscow Airport Domodedovo has enjoyed significant growth in recent years. This has been as a consequence of the launch of services from the airport by new airlines, the reconstruction of the airport facilities, implementation of new technologies as well as enhanced customer services. Today, Domodedovo works with 80 partner airlines, including 30 Russian, 35 foreign and 15 air carriers from the CIS countries, which fly to 220 destinations in Russia and worldwide. This whole operation requires a significant investment in GSE. Elena Galanova, spokesperson for Moscow Domodedovo Airport, helps us with our questions
Airside Which part of East Line actually undertakes the buying – is it the handling company or some other part of the group? Do you buy tugs, deicers, loading equipment, etc, whenever you need them or do you have a fixed investment plan for the acquisition of GSE each year for which you budget?
Domodedovo All the companies in the Group, including Domodedovo Airport Handling (DAH), purchase equipment themselves. The procurement predominantly carried out as part of an investment plan which is prepared based on the airport needs, current status of the equipment in operation, development prospects and to be approved by the management.
Airside If Eastline is Domodedovo Airport’s operating company, who owns Eastline? Is there government ownership or is it entirely privately held?
Domodedovo At the moment, the Eastline Group is going through rebranding procedures; this means that the Group, operating 15 companies, will now be known as Moscow Domodedovo Airport. Full private ownership of the holding remains unchanged.
Airside Is there any centralised government purchasing of GSE for Domodedovo Airport or is all purchasing carried out by the airport group alone?
Domodedovo It is the Airport’s responsibility to purchase the required equipment.
Airside Can Eastline/Domodedovo procure GSE from any manufacture of this equipment wherever they are in the world? Do import duties and transportation costs make it more expensive to buy equipment from certain parts of the world so it is just not practical to buy GSE from manufactures in certain regions?
Domodedovo Foreign manufactures make the bigger part of all the equipment operated at Domodedovo. Transportation costs as well as import duties undoubtedly affect the final price which is considered as one of the most important factors for sourcing when other conditions are equal (same type, similar specifications and maintenance costs). However, if a foreign supplier proposes a more attractive price (considering the additional expenditures mentioned above) then it doesn’t matter if the supplier is located in America or Europe – the supplier will have a good chance.
Airside What is the Russian competition for GSE like? Do Russian manufactures of certain types of equipment used on the ramp to service aircraft and move freight compete heavily with foreign suppliers?
Domodedovo There are some companies in Russia manufacturing GSE equipment. Considering advanced foreign technologies and attractive prices proposed by the Asian market, Russian manufactures find themselves in a less favourable position. Nevertheless, equipment produced by national manufacturers allow for the handling of aircraft built in former Soviet Union times. Moreover, Russian manufacturers strive for cooperation with foreign suppliers and are now building equipment as part of joint projects.
Airside Do you sometimes import equipment from outside Russia and simply mount it on Russian built trucks, eg deicers?
Domodedovo Domodedovo Airport Handling has a preference for off-the-shelf products, including deicers.
Airside What about compliance standards? Does GSE imported into Russia have to meet certain regulatory standards? Are these Russian standards or internationally accepted standards?
Domodedovo All GSE imported into Russia is subject to certification and licensing in accordance with the federal legislation, despite international certificates being in place.
Airside What about maintenance and support of GSE imported into Russia? Does a GSE manufacturer have to work with a partner to maintain these assets or is there engineering and support infrastructure already in place on the ground?
Domodedovo Most foreign manufacturers prefer to work through a resident on a contract. The contract provides for the promotion of a product in the Russian market, establishment of a service network, spare parts storage and expendable materials.
Airside We understand that the Airport Development Master Plan provides for reserving 13,000ha for construction of new runways, passenger terminals and infrastructure in the future. Does this mean that you will be buying a lot more GSE in the future? What are your expectations?
Domodedovo Based on general plans for development of Domodedovo Airport Handling and the Domodedovo Air Passenger Terminal, it can be assumed that equipment will be constantly upgraded to make it more technological, economically efficient and environmentally friendly.
