Shifting Landscape of Airlines and MRO

Challenges, Opportunities in Shifting Landscape of Airlines and MRO

The demand for aircraft Maintenance Repair and Overhaul is on the rise. Are Airlines and MRO companies ready? 

The Aircraft Maintenance Repair and Overhaul (MRO) business is poised for stunning growth in the near term, but the Airlines and MRO companies that provide those services must navigate a rocky and often-unpredictable landscape in order to thrive.

Rapid fleet growth and the rise of emerging markets, especially in Asia, where the aftermarket is fragmented and uncoordinated, will change the way aircraft operators make decisions about their MRO supply chains.

Meanwhile, MRO providers also must contend with new competitive forces and an increasingly demanding customer base. They need to be vigilant and ready for upcoming shifts in market forces. And they need to forge and nurture global partnerships with suppliers and logistics providers who know how to succeed in times of rapid, but unpredictable, international growth.

Boeing’s projects the world’s fleet will double over the next 20 years as 36,770 new planes take to the skies. Forty two percent of those will replace older ones, mainly in North America. But, in general, commercial planes are being retired at a modest rate now. The average age of aircraft at retirement has risen steadily over the last 40 years. This means the MRO market will be lucrative.

“Greater globalization brings with it inexperienced workforces, immature logistic networks and regulatory oversight challenges.”

For now, North America is the top region for MRO value, but Asia is on track to eclipse it, according to which provides consulting and technical services to the global aviation and aerospace industry. 

Turbulence ahead

Plane-makers and suppliers, meanwhile, are building more efficient, reliable and advanced commercial and military aircraft, engines and components. This new technology puts added pressure on MRO providers to be versatile and to cultivate new skills.

How all this shakes out is yet to be determined. But fleet growth will change the timing and type of maintenance required. Old ways of doing business are falling by the wayside, and supply chain performance will be under closer scrutiny.

The MRO environment is tense, and the competition is fierce. One reason is that original equipment manufacturers (OEMs) want to capture a bigger share of overhaul activity and preventive maintenance. In asserting more control, they’re leveraging their position with suppliers on parts and prices. This, in turn, pressures MRO providers on cost.

MRO providers must be agile and flexible as the type and timing of maintenance changes with newer planes with more durable parts, new designs, and more efficient engines and other characteristics come into play.

Capturing the opportunity

There are a lot of questions as the MRO ecosystem reshapes. But there are also opportunities.

The potential for growth is almost limitless. We know demand for MRO services is on the rise, and we know it’s coming from new regions. Airlines and MRO companies just have to be ready to adjust quickly to new demands.

It’s all about being prepared, being nimble and aligning yourself with partners who can get you where you need to be.