AAR Corp. (NYSE: AIR) completed the formation of the xCelle Asia joint venture with Air France Industries KLM Engineering & Maintenance (AFI KLM E&M) on December 10 2025. The new facility in Chonburi, Thailand, will specialize in overhauling nacelles for next‑generation engines, including the GEnx, Trent 1000, and LEAP‑1A/1B families, and will provide on‑wing and on‑site inspections as well as rotable support.
The partnership combines AAR’s global logistics and maintenance expertise with AFI KLM E&M’s engineering and manufacturing capabilities. Both parties hold OEM licenses that allow the venture to service a broad portfolio of high‑performance aircraft, positioning the joint venture to capture a larger share of the aftermarket in a region where demand for MRO services is accelerating.
AAR’s Q2 FY2025 results—sales of $686.1 million, up 26% YoY, and adjusted EBITDA of $78 million, up 42%—illustrate the company’s strong growth trajectory. The adjusted EBITDA margin rose to 11.4% from 10.1% in the prior year quarter, driven by the Product Support acquisition and operational efficiencies. The new joint venture is a natural extension of this momentum, offering a high‑margin service line that complements AAR’s existing MRO portfolio.
Management emphasized the strategic fit of the venture. Jim Berberet, Senior Vice President of Component Services at AAR, said the partnership “marks a significant expansion of our service offerings in the Asia‑Pacific and reinforces our commitment to delivering high‑quality, industry‑leading solutions.” Benjamin Moreau, Senior Vice President of Strategy and Business Development at AFI KLM E&M, added that the venture “strengthens our global MRO network and brings world‑class nacelle support closer to our customers in one of the world’s most dynamic aviation markets.”
While the announcement did not trigger a sharp market reaction, analysts noted that the joint venture aligns with AAR’s broader strategy to deepen its presence in high‑margin aftermarket segments and diversify its geographic footprint. The venture’s focus on new‑generation aircraft and OEM‑licensed capabilities is expected to contribute to future revenue growth and margin expansion, reinforcing AAR’s competitive position in the Asia‑Pacific MRO market.
The joint venture is the second collaboration between AAR and AFI KLM E&M, following a 2021 partnership in the Americas. Together, the companies aim to leverage their complementary strengths to capture growing demand for aviation aftermarket services, a market projected to expand as global air travel recovers and fleet renewal continues.
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