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Southwest Airlines signs USD1.5 billion OnPointSM Solutions agreement with GE

18-Oct-2005

EVENDALE (GE Transportation) - Southwest Airlines and GE-Aviation's Engine Services operation have signed an innovative new eight-year OnPointSM Solutions service agreement valued at $1.5 billion for the overhaul and maintenance of the airline's fleet of nearly 600 CFM56-7B* engines (in service or on order).

The new OnPointSM agreement, which is a hybrid of traditional OnPoint time and material and rate per engine flight hour agreements, is structured to give the airline price and program flexibility to reduce risk and help it achieve the lowest total cost of ownership.

"More than half of our current fleet is powered by the CFM56-7B," said Jim Sokol, vice president of Maintenance and Engineering for Southwest Airlines. "This new contract helps assure us that we're going to maximize our investment in this product and enable us to achieve the kind of engine maintenance cost savings that we need to remain profitable."

"We've been Southwest Airlines' maintenance provider for more than a decade, and we're looking forward to the next phase of that relationship," said David Romansky, regional sales director for Engine Services. "It is highly gratifying to have an airline of this stature express continued confidence in GE's ability to consistently provide innovative, high-quality, cost-effective maintenance solutions."

Highlights of the agreement include fixed-price life-limited parts shop visits, turn-around time and performance guarantees, spare engine availability, on-wing support, and remote diagnostics. Another important feature is fleet management support, which will bring Southwest the benefit of GE's expertise in engine workscoping, shop visit forecasting, cost estimating, and budgeting.

During its 34-year history, Southwest has grown to become one of the largest airlines in the United States and flies more than 70 million passengers each year to 61 cities all across the nation.

OnPointSM Solutions are flexible long-term commitments designed to meet customers' unique engine service needs. Backed by GE's world-class support, these solutions are designed to maximize asset value and utilization and improve operating efficiencies. OnPoint services include overhaul, on-wing support, new and used parts, component repair, technology upgrades, engine leasing and diagnostics.

GE-Aviation, a division of the General Electric Company (NYSE: GE), is one of the world's leading manufacturers of jet engines for civil and military aircraft, as well as a global provider of maintenance and support services for operators of GE and non-GE jet engines.

SM OnPoint is a service mark of General Electric Company.

*CFM56-7B engines are produced by CFM International, a 50/50 joint company between GE and Snecma.

GE Transportation is a CAPA Member. For more information on the Centre for Asia Pacific Aviation's membership service, please click the icon below.

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