PODCAST: Xtreme CEO on 10th anniversary, expansion ahead

Jeff Lee
Hello and welcome to this episode of cargo facts connect, the podcast of cargo facts, the newsletter of record for the air cargo and freighter aircraft industries for over 40 years. I’m Jeff Lee, editor of cargo facts and it’s Monday, the 31st of July. This past weekend, MRO group Xtreme aviation celebrated its 10th anniversary with a gala dinner in Miami. I pulled Xtreme CEO Carlos Cock away from the festivities for a brief chat about the company’s achievements and what we can expect ahead.

Jeff Lee
Hey, Carlos. So you’re at your 10th anniversary celebration right now in Miami. First of all, congratulations.

Carlos Cock
Yes, absolutely. First of all, we want to start off by thanking you guys, thanking thanking the cargo facts family, you guys have been very supportive of our growth in keeping everybody in touch with all the new developments and everything that we have been doing. So we really appreciate that. Want to thank Robert, for joining us at our 10 year anniversary? And yeah, we are very excited. We had a great turnout, good time, and it’s, you know, just fun to see all the partners come out the our extreme family, our employees, our members, and our sponsors. So it’s been a great night.

Jeff Lee
Yeah. So you know, it’s been 10 years, what would you say have been the biggest milestones or achievements for xtreme.

Carlos Cock
So xtreme started out as a very small company, it was providing basically, line maintenance services in Miami, we were about 10 employees at the time of the beginning, we went on to get our certification as a 145. And we’re able to expand on our products. So within three to four years, we expanded to the heavy maintenance side. And we’ve now been six years as a heavy maintenance provider. That’s really been one of our big milestones. And now taking it to the next level with expansion plans and numerous other companies that will be joining our, our portfolio.

Jeff Lee
Yeah, we’ll talk a bit about that in a moment. But obviously, you’ve been involved with MRO for longer than 10 years, generally, what have been some of the changes that you’ve seen in the MRO business? And what do you think still needs to be changed or improved?

Carlos Cock
So you know, mros go through a steady change. And it’s all about adapting to the environment. You know, COVID, brought many, many changes to the MRO business. And it was also part of our change of our culture, and adding verticals, and integrating different services to our company. I think that taught us a lesson. And it really widened and opened our eyes, as to where we needed to be as an MRO to be able to stay successful.

Jeff Lee
Right. Speaking of adding verticals, you entered the freighter leasing business last year. And, you know, how does it feel? I mean, it’s already been well over a year now just over a year? And what can we expect going forward for this for this new line of business?

Carlos Cock
Correct. So adding that vertical to our portfolio was very important for our growth. And also for our customers, we have been able to establish great relationships with smaller airlines, smaller companies are also seeking that growth path. And us being able to provide that to them. It really has become more of a partnership than a relation of, you know, customer and supplier. So we’ve been blessed in that sense.

Jeff Lee
Yeah, it’s interesting, because, you know, obviously, the air cargo market generally, is going through some headwinds with slowing growth in most areas, I would say, and, but with some of these smaller carriers, and some of these are new cargo carriers. It’s, you know, there are opportunities out there.

Carlos Cock
Yeah, yes, that’s correct. I mean, there are numerous opportunities and I think one of our niche have been able to identify those smaller guys, the guys that are coming up and maybe already have an established business but need that extra push or that additional assistance to provide the lift that you know, they already have product for. So we’ve been lucky to be able to step into a couple of those deals and assisting those smaller companies.

Jeff Lee
Yeah. And, you know, other challenges, of course, include, and these aren’t specific to the cargo market, but you know, labor and even the price of materials, these costs are going up, as you know, and MRO provider, how are you addressing and overcoming these challenges?

Carlos Cock
Yeah, absolutely. It keeps us on our on our toes, keeps us on our feet. It’s basically an everyday battle, you have to be very conservative and very watchful of, you know, all your costs, all your expenditures, and everything, the rising cost, and the limitation and materials has affected, you know, not only us, but all the mros, we have a great team dedicated to, you know, keeping up with all these daily, basically daily changes. And we have been able to establish great, great, great relationships with vendors that are now you know, more than just vendors, they’re our partners. So they’re in it with us to make sure that we succeed as well, because their success depends on ours. All right.

Jeff Lee
And so going back to the Freighter side of things, last year, you completed your first 737 classic conversion, the Pemco conversion, tell me a bit about, you know, your plans for the freighter conversion capability. And, you know, you hinted at potentially moving on to the NGS as well.

Carlos Cock
That’s correct, we think there is still room in the market for a few classics, we do have customers that have retained the conversion services with us for classics, stock has been very limited. So as these aircraft become older, you know, there, there’s not that many around. So we’ve been really on the lookout and trying to acquire the next 400 to convert is just it’s been very difficult. And then also, we’ve been looking at the NG market. So we are in the mid stages of developing a transition into being able to perform these conversions as well on NGS.

Jeff Lee
And how do you balance? You know, your resources when it comes to performing the conversion, as well as handling all the other MRO work at your facility?

Carlos Cock
Yes, absolutely. So our first conversion, we were able to put together a team of structured technicians that had the experience and conversions. And we have been able to retain that team intact, dedicated them to all our other MRO work and heavy maintenance work. So at the time, when we are ready, you know, to induct the next aircraft, we will have that team in place, and it will just be a matter of placing them back in.

Jeff Lee
Okay. Let’s go back to talking about your the expansion. You are I understand you are growing, one of the areas you’re growing, is also the on the engine side of things.

Carlos Cock
Yes, correct. So we’ve have, we have had a engine testing platform now for about four, three to four years. We are the only MRO certified by the FAA and CFM themselves to perform engine test in our own testing apparatus, meaning aircraft. So we’re now looking to expand that business and have acquired a company to be able to expand into the engine business as well. So K and J. Aviation is now part of the extreme group. We have completed the acquisition. And we will be developing this next vertical and integrated into our portfolio with the intent of performing initially just hospital visits and minor work to new gen engines. CFM mostly.

Jeff Lee
Alright, and how long have you been thinking about this acquisition?

Carlos Cock
Ah, we’ve been on and now for about six to seven months. We’ve seen the market necessity and for additional, you know, engine shops, and it’s just the fit to everything else that we’re doing now. So we went ahead and made this acquisition and we’re going to be growing the company in the near future. We’ve also just acquired a component shop, aviation pneudraulics is also now being added as part of the extreme group, family of businesses. So all these verticals are going to be giving us the opportunity to better supply our customers in a variety of fields, and just logically integrated within the aviation industry and the MRO services that we provide now.

Jeff Lee
Wow, congrats. I mean, it’s a lot of impressive growth on multiple fronts, I guess, you know, in the what can we expect? Or what do you envision for the company in the next 10 years?

Carlos Cock
I think next 10 years, definitely looking forward to a bright future, we want to be able to sustain our growth. It’s really more about our employees and our family of employees, we want to be able to provide an environment for them to feel proud of, you know, forming part of a group of companies that have come from basically zero, to grow into what we want to grow in the future and make it a steady, a steady environment for our employees. We really appreciate our employees and without them, you know, this, none of this would be able and we wouldn’t be, you know, even having the conversation. So it’s all thinking for a brighter future for our employees.

Jeff Lee
Well, congrats again, and here’s to the next 10 years, I will let you get back to your celebrations. But thank you so much for your time.

Carlos Cock
Absolutely, Jeff, and we thank you and cargo Facts for always, you know, being on the lookout for us and everything that we do and put together sharing with the rest of the industry. So we really appreciate you guys.

Jeff Lee
Thanks, Carlos.

Carlos Cock
All right. Thank you.

Jeff Lee
That was Carlos Cock, CEO of Xtreme aviation. And that’s all for today. For more multimedia coverage like this search cargo facts connect on iTunes and Spotify and search cargo facts.com. Thank you very much for tuning in. And join us again next time.