Bruce Dickinson has said that Cardiff Aviation must have cash invested in the company to continue its Maintenance & Repair & Overhaul (MRO) facility at St Athan.
At an organised press event Mr Dickinson claimed that he had “credible overseas investors” lined up ready to invest around £15m into the company but that requires involvement from the Welsh Government who have already invested substantial sums of money into the business via Finance Wales, rates rebates and, as reported by us earlier this year, writing off a significant amount of money in unpaid rent.
The company, which started in 2012, has suffered significant financial problems since launch which came to head recently when it emerged staff weren’t being paid. The coverage saw Mr Dickinson paying a portion of the money owed to staff out of his own account to prevent a walkout.
The company started out to provide maintenance on aircraft belonging to 3rd party clients such as Easyjet and Monarch but dissastisfaction with the work led to those contracts being cancelled and the work dried up. The company has struggled to gain a foothold in the MRO market.
Shortly after launch Mr Dickinson launched his Airline in a Box product which was designed to change the way airline start-ups do business however, in 2 years it has only attracted one customer Air Djibouti.
Questions have been asked over the amount of assistance given to Cardiff Aviation Limited in terms of initial support, writing off rent totalling hundreds of thousands (some estimates put the figure at over £1m) and rates rebates whilst many other businesses in Wales are left to fail prompting suggestions that the Welsh Government is being blinded by the profile of Mr Dickinson and Cardiff Aviation.
The Welsh Government and Economy Secretary Ken Skates were asked about the Welsh Government involvement Mr Dickinson said is required for the new investor and they denied any involvement with potential investors. A spokesperson for the Welsh Government said: “Cardiff Aviation’s relationship with a potential overseas investor is a private, commercial matter between the two parties and the Welsh Government is not involved.”
Referring to the current work being carried out by Cardiff Aviation Limited, Mr Dickinson described it as “hand to mouth” after taking on work on behalf of other MRO’s claiming that they were taking advantage of the shortage of a MRO facilities in Europe.
As always with Mr Dickinson he dreams big, rather than growing the business slowly and surely he is straight away talking about operating 4 bays with 500-600 people being employed if the investment comes through, and it is here that the big caveat comes on, IF the investment comes through! When you listen to Bruce Dickinson talk you hear could, might & If alot. There always seems to be a degree of smoke and mirrors.
At this latest press event for example he showed off work for holiday airline Tui, which was in fact just end of lease checks on an aircraft (Boeing 767 G-OBYE) that had been leased to Tui. Nonetheless, it was good to see that 3rd party was actually being carried out as for the previous year, none had come at all. In fact, a second 767 is in for a cabin configuration change before going to back to an African airline.
There has also been reports of an internal power struggle with Managing Director, Martyn Anderson reportedly seeking his own investment separate from Mr Dickinson, some analysts have even suggested that a condition of any future investment is that Mr Dickinson takes a back seat in the company, something he has himself hinted at suggesting he would be willing to reduce his ownership to just 10%.
As for the work at Cardiff Aviation, Mr Dickinson claims that not only is work coming in but rent is up to date (thanks to it being wiped off the taxpayers books) and the much-lauded ILS (Instrument Landing System) at St Athan is now in use, although Aviation Wales has learnt that the ILS is still listed as U/S (unserviceable), obviously someone hasn’t told Bruce!
One creditor & previous customer we spoke told us that the biggest problem they face is their location. “We can send our aircraft to an [MRO] facility in Eastern Europe and get the same work carried out with a saving of around 40%” – a sentiment that is echoed through an industry that is driven by reducing costs. One analyst suggested that whilst Cardiff Aviation is picking up “over spill” the main contracts will always go to the cheaper Eastern European and Asian MRO’s because of price.
It remains to be seen IF the investors Mr Dickinson is talking about are willing to risk £15m in a business that in 5 years has achieved little to no growth and if they do, what is required from the Welsh taxpayer to make it happen with the Welsh Government seemingly willing to do “whatever it takes” to keep Cardiff Aviation afloat.
In the meantime many staff are still concerned whether they will actually get that pay packet, which is currently being paid fortnightly to alleviate staff fears. Many were unwilling to take the risk and have already left for more secure jobs.
One thing is clear though and that is to survive, Cardiff Aviation must have a cash injection and soon. So to borrow a phrase from the Bruce Dickinson school of business speak, things could get better!
Notes: A freedom of information request for information on how much financial support that the Welsh Government had given to Cardiff Aviation and the exact amount of unpaid rent that was written off was rejected on grounds of commercial sensitivity outweighing public interest. This is currently under review.