SINGAPORE (Reuters) - Boeing’s services unit announced on Tuesday deals worth nearly $1 billion as part of its effort to more than triple the division’s annual revenue to $50 billion in as little as five years.
The jet manufacturer has been looking to boost revenue in its services business which involves jet maintenance, repair and overhaul (MRO), data analytics and pilot training.
Revenue grew by 5.5 percent to $14.6 billion in 2017 and the growth rate is forecast to be even higher this year, Boeing Global Services CEO Stan Deal told Reuters at the Singapore Airshow.
“Over the next 5 to 10 years we are going to accomplish that as a stretch objective,” he said of the $50 billion target, adding it will “clearly involve” acquisitions.
Deal said areas of interest for acquisitions included aircraft interiors and data analytics.
The agreements announced on Tuesday included landing gear exchange deals with Japan’s ANA Holdings Inc and Malaysia Airlines and an order from cargo group DHL for a 767-300ER converted freighter.
The revenue split in the Dallas-based services division is about half military and half commercial services at present, but Deal said that balance was expected to shift toward commercial over time.
“Commercial is just more rapid because of the strong continued growth in commercial aviation and the continued strong growth projections particularly in the Asia-Pacific,” he said.
Reporting by Jamie Freed and Fathin Ungku; Editing by Muralikumar Anantharaman