IndiGo Aircraft Close Up Airbus
India’s IndiGo took delivery of its first Airbus A320neo in March. More than half of the A320 family’s forward passenger doors are produced by Hindustan Aeronautics Ltd.

India, China Lead Global MRO Growth Rates

MRO in India and China to expand at fastest rates in next 10 years.

India will see MRO growth far surpass that in other geographical areas between 2017 and 2026—expanding at 10% over that period, according to Aviation Week’s Commercial Aviation Fleet & MRO Forecast. For 2017, total MRO demand should hit $1.4 billion there.

Maintenance activity in India has been characterized in recent years by an influx of overseas companies establishing facilities and joint ventures. OEMs, having made no secret of the fact that they are looking to grow their aftermarket interests, also have ramped up their operations to service growing demand for maintenance and training. In May 2016, Airbus confirmed plans to establish an MRO technician and pilot training center in New Delhi with the capacity to prepare more than 8,000 pilots and 2,000 maintenance engineers over 10 years beginning in 2018. Airbus has predicted the country would need deliveries of more than 1,600 passenger and freighter aircraft in the 20 years through 2035.

India’s IndiGo took delivery of its first Airbus A320neo in March. More than half of the A320 family’s forward passenger doors are produced by Hindustan Aeronautics Ltd. Credit: Airbus

As of 2017, India is expected to have about 800 in-service aircraft. On the engine side, Indian airlines are predicted to take delivery in 2017 of the biggest share of Pratt & Whitney PW1100G-JM-equipped Airbus A320neo-family aircraft.

Second to India in MRO growth will be China, which is expected to see an 8.6% increase in spending in 2017, to at least $6.5 billion. Like India, China’s growth has been spurred by the rapidly accelerating number of aircraft and passengers in the country, with carriers such as Air China, China Southern Airlines and China Eastern Airlines all expanding their regional and international fleets in recent years.

During 2017, 400 new jets are projected to enter Chinese airline fleets. The past year has seen more aftermarket joint ventures form in China, while existing ones have sought to grow their scope. A similar trend has occurred in the Middle East, which is earmarked for an MRO compound annual growth rate (CAGR) of more than 6%.

The region is a hub for engine MRO, which is predicted to account for more than $2 billion in 2017, or about 36% of the region’s  demand. Overseas companies have taken note of the region’s engine boom and have sought to establish a presence there. Rolls-Royce has confirmed it intends to  establish an approved maintenance center in Abu Dhabi for services on its Trent XWB engine option for the Airbus A350. Rolls-Royce forecasts the Middle East region to have one of the largest concentrations of Trent XWBs. Another European provider, Air France Industries KLM Engineering & Maintenance (AFI KLM E&M), has expanded its nacelle component repair capabilities through its Aerostructures Middle East Services joint venture with Safran, which services a selection of Rolls-Royce and CFM engine types.

The mature North America and Western Europe MRO regions also are projected to continue growing, but at more modest rates. North America, which is still the world’s largest MRO destination with a 27% market share and also largest by fleet size, will have an anticipated CAGR of less than 1% annually for the next 10 years. Nevertheless, like airlines in regions growing at faster rates, North American carriers are teaming with MRO partners.

One of these is Southwest Airlines, whose senior manager for powerplant supply chain, Amanda Gower, said at MRO Europe in October that the carrier is open to more partnerships. Southwest is looking to further expand its MRO interests as it undergoes a renewal of its vast fleet. Aviation Week projects the airline will spend $5.6 billion on engine MRO in the next 10 years. “We’re exploring new possibilities within the MRO market to take advantage of available offerings,” said Gower. “Long-term, it’s important to have relationships with the technical companies that are out there developing repairs.”

The world’s second-largest MRO region, with a 24% market share, Western Europe will see a 2.1% CAGR in 2017-26 with a focus on modification spending estimated to be $1.5-2 billion. MRO growth in Eastern Europe will be at a slightly higher rate of 2.4%. This is where regional providers such as Lithuania’s FL Technics and Estonia’s Magnetic MRO have sought to expand their capabilities and geographical reach while low-cost carriers such as Hungary’s Wizz Air place large aircraft orders.

Latin America and Africa, both viewed as having under-served MRO markets, are projected to have a 10-year CAGR of 4.0%. The two regions are forecast to see an influx of turboprop aircraft such as the ATR 42/72 and Bombardier Q400, both powered by Pratt & Whitney Canada’s PW100. The PW100 will comfortably have the highest MRO demand for an engine: more than $400 million per year ahead of the company’s PT6A variants. They power aircraft and rotorcraft such as the de Havilland DHC-6, Beech Super King Air, Pilatus PC-12 and Sikorsky S-76. 

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