A new maintenance hub at Birmingham Airport could provide a welcome boost to the region’s aerospace sector by helping to create a cluster of engineering firms.

Airline firm Monarch says 300 new jobs will be based at a 110,000 sq ft hangar, with work to begin in January, after the airport beat competition from elsewhere in the UK for the multi million-pound investment.

The move is set to provide a boost to the region’s soaring aerospace supply chain – after historic firm Hampson Industries collapsed the day before – and supplements Aero Engine Controls – a joint venture between Rolls-Royce and Goodrich – plans for a £60 million manufacturing factory in the nearby Birmingham Business Park.

The new hangar – which is more than 1.5 times the size of the pitch at Wembley Stadium – will replace the existing 1939 sheds at the airport after a long-term lease was agreed.

Airport chief executive Paul Kehoe told the Post: “We are creating a cluster of excellence here, with the likes of Rolls-Royce and Monarch investing.

“I am sure there will be other companies involved in supply chain management that will be involved. He added: “I just hope this acts as a catalyst and we can demonstrate that the Midlands is the place to be for aerospace engineering.”

The hub will be built by November and will initially create 150 jobs, with the potential to create a further 150.

However, Mr Kehoe said the boost will be felt even more greatly in the supply chain.

“In engineering they say every job you create means three or four down stream,” he said. “You are talking about potentially 900 jobs on that basis.”

The new Monarch Aircraft Engineering (MAE) hub will carry out maintenance work overnight and offer services such as ‘MOTs’, which are largely undertaken by aircraft 12 times a year.

The Monarch Group expects the hangar, which will have the capacity to accommodate wide-body aircraft such as the Boeing 777 and Airbus A350, to boost its share of the global market for outsourced airframe maintenance and repair.

It is the latest investment by Monarch in the airport after increasing the number of aeroplanes it operates from the city from four to eight in recent years.

Mr Kehoe, who said planning permission for the scheme had been agreed in principle, added: “It is a significant capital investment but also from our point of view the relationship with Monarch Airlines. They have doubled their flights and said they would consider growing further but need the infrastructure.

“It gives us capacity that we have never had.”

MAE managing director Mick Adams declined to reveal the value of the investment, but said it was “multi-million”.

He said the plan was to be up to 65 per cent of capacity within two years, employing 300 people, meaning there is more potential to create jobs.

And he said there were opportunities for the Midland aerospace supply chain.

“We already have an established logistics infrastructure but this presents a fresh opportunity to look at the supply chains,” Mr Adams said.

“We can do things in a completely different way and this gives us more capacity to engage with different supply chain organisations.”

Mr Adams added: “There is a longstanding history of engineering skills available in this part of the UK.

“It was also important to us to have the facility operational by November because we are having to turn customers away at the moment.”

The Post reported in May that Aero Engine Controls was set to invest £60 million in a new manufacturing site.

The firm will start re-locating over 1,100 staff at its current site in Hall Green to its new facility during 2014. The 250,000 sq ft building will incorporate technology, design, development, manufacturing and testing capabilities, with associated expansion space.