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2018 Could Be a Big Year For 777 MRO Demand

Expect to see a spike of Boeing 777s coming off of lease, which will spur MRO demand.

HANOI, Vietnam—Increasing demand for Boeing 777 and 787 work will be an important dynamic in the MRO industry this year, predicts Rahul Shah, AAR Corp. senior VP.

This year will be particularly big for the 777 MRO market, Shah said during Aviation Week’s MRO East Asia conference. There is expected to be a spike in 777s coming off lease, meaning additional business for MROs. Aircraft will need work to meet end-of-lease requirements, in some cases heavy checks, and new customers will require cabin modification to match their existing fleets.

Shah said this highlights the trend of rapid growth in interior refurbishment work. He predicts this market will double from about $2 billion a year within the next 5-10 years. Airlines are generally more profitable, and interiors is one area they are looking to increase investment, said Shah.

Regarding 787s, Shah noted that two airlines began their first heavy C checks on this model in 2017. This year even more 787 operators will need heavy checks, he said.

At the same time 787 and 777 work is picking up, MRO work for Airbus A330s and A340s has slowed down, Shah said.

Another important trend for the MRO industry is the continued improvement in the cargo market. This uptick could run for at least another two years, meaning increased demand for aircraft conversions, said Shah.

Overall, there is “a lot of bullishness in the [MRO] business” at the moment, according to Shah. He predicted a rise in vertical integration through partnerships and consolidation. And OEMs will be “trying to make more investments in the MRO sector and aftermarket.”

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