hangarairmaintenanceestonia1.jpg Air Maintenance Estonia
(AW) Air Maintenance Estonia plans to finish building this hangar mid-July and commence operations in it in September. MROs in Estonia and Lithuania face expansion choices. Modern aircraft maintenance in northern and eastern Europe is little more than a decade and half old. It has been fueled by rapid growth in local air traffic, especially in low-cost service, integration of many eastern states into the European Union and lower labor costs, which attracted airframe work from outside the region.

MRO Competition Intensifies In Baltics

The industry in this region is dominated by smaller players, and fragmented.

The MRO market in Eastern Europe, the Baltics and Commonwealth of Independent States is very fragmented and is driving “hyper competition,” says FL Technics CEO Jonas Butautis. “This region is dominated by smaller players and frankly I don’t see that changing,” he says.

ICF SH&E pegs the MRO market in this region at $2.1 billion, compared to $50.9 billion for the whole world in 2011.

Butautis says FL Technics, which is part of the Avia Solutions Group, says MROs in the region represent $0.7-0.8 billion of the $2.1 billion, and MROs outside the region log the rest of the $1.3-1.4 billion annually.

Besides FL Technics, some of the other 20 maintenance providers in the Eastern Europe, Baltics and CIS region include Air Maintenance Estonia, S7, Aeroplex, JAT Technika, JobAir Technic, LOT Aircraft Maintenance Services, Lufthansa Technik Sofia and Budapest, and CSA Technics.

About 40 other MROs outside the region, including big aftermarket companies such as SR Technics and ST Aerospace, also pursue maintenance from the region, which intensifies the “hyper competition” that Butautis describes.

“We [FL Technics] believe there are ways to be successful in the market,” he adds. FL Technics is a testament to this as it has quadrupled its revenue over the past few years.

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