Aviation Engine MRO Market

The global aircraft engine MRO market is growing at a rapid rate due to the increasing MRO outsourcing activities and rapid fleet expansion. In addition, the development of next-generation aircraft engines is also expected to drive the growth of the market. However, the high cost associated with aircraft engine MRO and their growing environmental hazards are expected to hamper the growth of the market during the forecast period.

There has been an increase in the outsourcing of MRO activities by MRO service providers to small companies specialized in the engine, engine-related systems, or component maintenance. The outsourcing of aircraft engine MRO to third-party companies is a significant driver for the growth of the global aircraft engine MRO market. Outsourcing helps MRO service providers reduce expenses, with more than 10%–20% in cost savings.

There has been an increase in the outsourcing of MRO due to the benefits such as low labor rates and the availability of adequate spare parts. For example, engine maintenance involves high costs due to the need for specialized infrastructure and skilled workforce. The outsourcing of inventory and infrastructure required to carry out maintenance reduces the overall cost for the MRO service providers.These factors are expected to drive the growth of the global aircraft engine MRO market during the forecast period.

In recent years, aircraft manufacturers have been using new technologies such as 3D printing to manufacture complex aircraft parts. Additive manufacturing or 3D printing is a developing technology that assists users in creating and designing innovative objects, surpassing conventional methods such as computerized numerical control (CNC) cutting, canvas printing, or mold manufacturing. Companies are using 3D printed parts as they are economical and allow for quick design and rapid changes of internal features in engine and components, which is not possible in conventional manufacturing methods. This has helped reduce the size and weight of the entire aircraft while increasing customization and overall maintenance efficiency. Thus, the use of 3D printed aircraft parts would reduce the overall MRO costs and would act as substitutes for conventionally manufactured aircraft parts. Key companies, such as Honeywell International Inc. and Airbus SAS, are implementing 3D printed components for aircraft MRO services. This would offer significant growth opportunities to the engine MRO service providers.

Maintenance costs of an aircraft engine vary according to the type of engine, for example, turbine engines such as turboprop, turbofan, and turboshaft, or piston engines. It also varies with the size and capacity of the aircraft engine. However, irrespective of the engine type, size, or capacity, the engine MRO costs can range from 30 to 40 percent of the total maintenance cost. This is too high as compared to a component, line, and airframe maintenance.

Moreover, the engine MRO cost tends to increase with the aging of aircraft or flight hours and cycles performed. Thus, the high cost associated with the aircraft engine MRO is restraining the growth of the market to some extent.

The COVID-19 pandemic has forced the governments of several countries worldwide to declare either complete or partial lockdowns. As a result, many airline companies have grounded their aircraft fleet. From a 100,000 commercial aircraft moving average, the numbers have fallen by over 50% within a month from February to March. This trend is expected to continue over the coming months as various countries, such as India and the UAE, are shutting down air travel services, and the skies are emptier with very less air traffic. With a large number of aircraft grounded, airline companies are expected to face heavy losses in the next few months. Airlines that are currently operating during this crisis have fewer passengers, which has raised the operating costs for these companies.

Engines being the most complex and important component of an aircraft, airline companies are required to upkeep engine maintenance for airworthiness of the aircraft once the lockdown are lifted. Furthermore, MRO services are required to prevent the engines from corrosion due to prolonged grounding of the aircraft. Furthermore, depending on the lockdown duration, airline companies have to decide upon deep storage of aircraft which would require additional MRO services. As airline company expenses witness a significant rise due to Aircraft on Ground (AOG), the demand for aircraft engine MRO services expected to remain moderate as the pandemic continues.

The defense industry is expected to have less impact on engine MRO services due to the COVID-19 pandemic owing to allocated budgets by respective governments. Fleet readiness is a crucial requirement for militaries which enables these establishments to have components and parts readily available. However, due to movement restrictions during the pandemic, a mild disruption in the supply chain is anticipated for sourcing of components from OEMs. Due to the ongoing pandemic, engine MRO would be primarily required for storage of military aircraft to prevent any component malfunction and maintain airworthiness.