When you fly in a commercial jet or private plane, it’s likely that some parts on the aircraft — rivets and high-tech screws, landing gear lamps or ball bearings — have been supplied by Miami-based KLX Aerospace Solutions.
“We are the world’s leader in stocking and supplying parts and equipment for the aerospace industry and we have about 6,000 customers,” said John Cuomo, vice president and general manager of KLX Aerospace Solutions, the most important division of Wellington-based KLX Inc., a publicly traded company. “We don’t manufacture anything, but we distribute parts to all the major airlines, aircraft manufacturers and repair and maintenance facilities.”
Customers include U.S. and foreign airlines, the military, original equipment manufacturers (like Boeing and Airbus), plus aircraft maintenance and repair facilities. The company handles thousands of orders every day, many of which are received and shipped within 24 hours.
“We stock over a million parts ready to ship and have about 3,000 suppliers globally,” Cuomo said.
Original equipment and replacement products range from a washer that costs less than one cent to a helicopter fuel tank priced at around $10,000.
Quality control is essential. “Everything that comes in the door is subject to rigorous inspection,” Cuomo said. He demonstrated a high-tech machine that was scanning thousands of specialized screws for precise specifications and tiny flaws, spitting the rejects into a bin for recycling.
A major player in South Florida’s huge aviation and aerospace industry, KLX Aerospace has more than 2,000 employees in 65 locations around the world. About 650 work in Miami, and the company is seeking applicants for the warehouse as well as for IT, finance, supply chain, sales and other departments.
Last year, the company was searching for alternate sites for its headquarters outside Florida, but decided to stay in Miami; it’s now building a new, automated warehouse and headquarters (about 600,000 square feet) in Hialeah.
“We did a lot of research but decided to invest in our growth in South Florida,” Cuomo said. Since most products are shipped by air, Miami was an ideal location to reach customers easily in the rest of the U.S., Latin America and Europe. “And our workforce is impressive. Personal service is a huge element and will continue to be important despite automation.”
The firm said it could add as many as 400 new jobs to its overall workforce in the future.
KLX Aerospace, with sales of about $1.4 billion in fiscal 2016, started as a family-owned aerospace supplier in Miami and was acquired by B/E Aerospace in 2001. As the aerospace sector grew, B/E bought several firms and expanded from aerospace hardware (fasteners like rivets, bolts, screws) to new product lines such as chemicals, lighting, electrical equipment, tools, specialty equipment and elaborate kits for repairing equipment on planes. KLX Aerospace was spun off at the end of 2014 and became the main business of publicly traded KLX Inc.
The company’s initials do not stand for anything, Cuomo said, and were chosen randomly as their brand.
Company name: KLX Aerospace Solutions, the main division of parent company KLX Inc., which provides products and services to the oil and gas industry through another unit, KLX Energy Services.
Founded: 1974 in Miami-Dade as a privately owned firm, M&M Aerospace.
Ownership: Parent company KLX Inc. is publicly traded on NASDAQ (ticker symbol: KLXI).
Leadership: John Cuomo, group vice president and general manager of KLX Aerospace Solutions; Jason Lewis, senior director of global quality and operational excellence.
About Cuomo: The Miami-based executive, who has more than 16 years of experience in aerospace parts distribution, has bachelor’s and law degrees from the University of Miami and an MBA from the University of Florida.
Financials: KLX Aerospace’s revenues for fiscal year 2016 (ending Jan. 31, 2017) were nearly $1.4 billion, up 4.9 percent from the previous year and representing 90 percent of total revenues for parent company KLX Inc. Operating profits for KLX Aerospace during the same period were $230.2 million, up 8.8 percent year over year. Parent KLX Inc. expects total revenues to increase by about 17 percent for fiscal year 2017. KLX stock closed at $52.54 on July 28, up from $46.92 on Jan. 3, 2017, the first trading day this year.
The difference: Decades of experience and deep expertise in the aerospace sector; an inventory of more than 1 million parts built to meet customers’ requirements; online systems to anticipate each customer’s needs linked to maintenance schedules; ability to respond immediately to emergencies and strong customer service.
Clients: About 6,000 worldwide in every market segment, including all major airlines, original equipment manufacturers (Boeing, Airbus) and maintenance and repair facilities. In Florida, the company has about 880 clients, among them American Airlines’ major maintenance and repair center at Miami International Airport and AAR Aircraft Services.
Competitors: Wesco Aircraft, plus other companies depending on business type, like Pattonair, which specializes in supply chain services. “We are also in ‘coopetition’ with firms like Boeing and Airbus,” which are manufacturers and suppliers of parts and equipment but also buy from KLX Aerospace, Cuomo said.
Headquarters: KLX Aerospace has its world headquarters at 10000 NW 15th Ter., Miami. Parent KLX Inc. is based in Wellington.
Employees: Approximately 2,000 people work for the Aerospace Solutions Group at 65 locations worldwide, including 20 in the U.S. In Miami, there are about 650. The parent corporation has about 3,000 employees.
Client view: “GKN has been working with KLX Aerospace and its various businesses for over 10 years,” said Robert Soen, senior vice president for global procurement at United Kingdom-based GKN Fokker, whose parent GKN designs and manufacturers components for aircraft, machinery and vehicles worldwide. GKN buys fasteners, hardware, chemicals and engineered products from the Miami-based distributor, which ranks as one of the British multinational’s top 20 suppliers, he said.
“KLX Aerospace are renowned as a global supplier. They have a track record for meeting our delivery and quality requirements in full,” Soen said. KLX Aerospace’s flexibility as a supply partner, ability to collaborate on an expanding supply agreement, its parts and equipment stocking strategy and personal attention from senior management are some of the reasons the company “has become a force to be reckoned with” in the international market, he said.
Business lesson: The company grew very quickly as it acquired new businesses, and suffered from growing pains. Executives learned to integrate these businesses effectively while maintaining strong customer service. “We learn every day,” Cuomo said.
Best decisions: Acquiring high-quality companies that added new geographical regions, customers and products to the KLX Aerospace portfolio.
Challenges and opportunities: Providing products and solutions for new generations of aircraft worldwide, including drones. In particular, as the middle class in China and other parts of Asia expands and uses air travel more, the installed base of aircraft will grow to serve these customers. KLX Aerospace will need to invest and grow to meet this new surge in demand.
Strategy and outlook: The company is looking for new products and services for the two huge sectors it serves globally: original equipment manufacturers in aviation and aerospace, and firms working in maintenance, repair and overhaul. “We’re very excited about the next stage in our development and growth,” Cuomo said.
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