Aircraft orders are cyclical, but the services market grows steadily. Given this fact, it’s easy to understand that the “aftermarket’s stability is one reason it’s so attractive and competitive,” says Laurent Martinez, head of Services by Airbus, speaking at Aviation Week’s MRO Europe Conference on Oct. 3.
Airbus forecasts the global market demand for new civil aircraft from 2017-36 will be $5.3 trillion, compared to $3.2 trillion for global services. However, whereas Martinez says there is mainly a duopoly between Airbus and Boeing for aircraft orders, the aftermarket services market is very, very fragmented, with the biggest OEMs and MROs only each taking a small percentage of the overall market. This is one of the reasons he says consolidation, such as between Safran and Zodiac and UTC and Rockwell Collins, is happening.
In 2016, Services by Airbus—which includes maintenance and material, interior services, flight operations and training-- generated $2.8 billion. Earlier this year, Martinez told Aviation Week that “we are expecting similar double-digit growth this year.”
This is part of the reason Airbus added four new members to its MRO Alliance, the formation of which it announced at the Paris Air Show in June. The four new members are all Airbus joint ventures-- Sepang Aircraft Engineering, HMS Services, ELTRA and GCAM—and join the six original ones that include AAR, Aeroman, Sabena Technics, Etihad Airways Engineering, GAMECO and China Airline. The difference between its new MRO Alliance and its former MRO Network is that “we want to share market views with the new alliance” instead of it serving as “club” like the old one did.
Change in its aftermarket strategy is partly driven by the number of parameters coming off each flight—400,000 in the case of the Airbus A350. “We need to unleash the full potential of aircraft,” says Martinez.
Airbus’ Skywise open aviation data platform is central to this. Martinez hopes companies across the industry will use it to support their digital transformation to gain operational improvements—from turning unscheduled maintenance to scheduled, to reducing fuel burn 2-5% and decreasing operational interruptions for airlines by up to 30%. Martinez stressed that Skywise is an open platform because “a key word for use is partnership.”