Passenger to freighter conversion on a Boeing 757-200 at ST Aerospace

Aviation Week Ranks Biggest Airframe MROs

Our biennial survey examining where the aircraft work goes

Since we compiled the last biennial airframe MRO survey that examined 2010 data, global airline revenue increased, next-generation aircraft and engines entered service, and MRO market consolidation affected the European and Americas aftermarkets. A major business disruption occurred in March 2012 when Aveos Fleet Performance , which reported 2.6 million airframe maintenance man-hours in our last survey, abruptly closed and sent its customers scrambling to find new vendors.

In the past two years, the overall commercial aftermarket grew by $7 billion in total value, with the MRO market forecast to be worth $51.6 billion in 2013 (AW&ST MRO Edition, April 15, pp. MRO16-18). The 2012 MRO figures that we will examine in this survey reflect that the biggest MROs have become bigger—in their capabilities, footprint, labor hours and revenue. If you look at their objectives for 2013 and beyond, those trends should continue, as long as they can find enough qualified maintenance personnel to accommodate their growth plans.

Take the second-largest airframe maintenance entity in this survey, the Haeco Group, which includes Haeco, Taeco and Staeco. Combined, it accomplished 1,183 maintenance inputs and grew its profits in 2012 by 6.7% to HK$876 million ($112.8 million), which reflected a strong demand for both airframe and line maintenance in Hong Kong, in particular. It did this despite selling 1.3% fewer maintenance man-hours last year, compared to 2011, due to a shortage of experienced technical staff. In its 2012 annual report, Chairman Christopher Pratt highlighted that “Haeco expects to do less airframe maintenance work in Hong Kong in 2013 than in 2012, with labor shortages restricting man-hours expected to be sold in the first half to 1.2 million compared with 1.6 million in the first half of 2012.”

Do not equate this to lower revenues, however, because Haeco is offering more higher-value and integrated MRO solutions, such as inventory technical management, cabin completions and reconfigurations. In addition, “We see an upswing in the market demand for GE90 engine overhaul services and are positive with the potential of narrowbody passenger-to-freighter conversions,” says Summit Chan, Haeco Group director for commercial aircraft.

ST Aerospace, which has headed our Top 10 Airframe MRO list for the last several surveys, accrued 11.5 million airframe maintenance man-hours in 2012, compared with 8.78 million in 2010. The Singapore-based MRO’s global airframe capacity includes 38 widebody, 27 narrowbody and 24 general aviation bays across its network, which includes facilities in the Americas, Asia-Pacific and Europe. Expect the MRO to open a new two-bay narrowbody hangar at Singapore Changi Airport, the primary airport for the island nation, in the third quarter that should add 200,000 man-hours to its annual capacity.

“While we recognize that the global airframe maintenance market is expected to experience slower growth with the retirement of older aircraft and the introduction of less-maintenance-intensive aircraft, we hope to maintain comparable global airframe man-hours for the next 1-2 years by growing our capabilities,” says Chang Cheow Teck, ST Aerospace president.

The MRO says its Boeing 757 freighter conversions are steady—it has redelivered 70 of the 102 aircraft for which it has orders, and its expects 767 freighter conversions to resume “once the feedstock becomes available as the 787 deliveries stabilize,” says Chang.

Like Haeco, ST Aerospace, which recently acquired Volant Aerospace and DRB Aviation Consultants, has expanded its interior reconfiguration offerings—including a new line of seats branded ERGO—and expects this area of its business to bring a steady flow of work during the next 1.5 years.

Many MROs in the top 15 expect cabin interior projects to be one of the strongest growth areas in the next couple years. In particular, Sabena technics, with 1.8 million airframe maintenance man-hours in 2012, forecasts cabin modifications and VIP completions to be robust. It expects its 2013 numbers to be similar. SR Technics, with 881,000 airframe maintenance man-hours in 2012, includes inflight entertainment.

Timco Aviation Services, which like ST Aerospace is promoting turnkey interiors that include its own seats, sees increased stand-alone modification programs, in addition to scheduled maintenance visits as “airlines undertake projects to reduce fuel burn (e.g. winglets) as well as to enhance or align cabin interiors across fleets,” including new lavatory units and seats, says Leonard Kazmerski, Timco’s vice president of marketing and business development.


SIA Engineering Co., which used 4.2 million of its 4.25 million available man-hours in 2012, also lists cabin retrofits as an expanding area. Besides providing complete cabin management services—from engineering design to procurement and installation—it also integrates communication systems such as inflight wireless high-speed broadband Internet and mobile phone services.


Not surprisingly, SIA Engineering and other MROs plan to add new widebody aircraft capabilities to expand their portfolios and revenues. The company also is looking at adding repair and management skills for the Boeing 787 and Airbus A350 .


Abu Dhabi Aircraft Technologies (ADAT), part of the Mubadala Network, plans to start offering A380 MRO services this year—and 787 and A350 capabilities in the future. ADAT also expects to add Rolls-Royce Trent engines to its roster. The last 1.5 years were spent “right-sizing” and restructuring, but President Abdul Khaliq Saeed says the foundational changes are complete. This year is focused on “capability development” and expanding “integrated component and engine services.”


SR Technics , which also is part of the Mubadala Network, plans to enhance existing A380 , 777 and 787 line, base and heavy maintenance products—including VIP services, engineering and modifications.


El Al Tech, which supports El Al Israel Airlines and third parties, targets next-generation narrowbody service expansion because the carrier is set to receive 6-8 new Boeing 737-900s. The eventual 23-aircraft fleet could increase its third-party base and heavy maintenance customers. The company completed 30,000 airframe maintenance man-hours for third-party customers last year.


Timco acquired a regional jet maintenance facility in Cincinnati last year and expects “to continue to add to existing regional jet capabilities” there in the next year, says Kazmerski.


Fokker Services, which had 230,000 aircraft maintenance man-hours in 2012, plans to expand Bombardier Dash 8 Classic aircraft capabilities in the Asia-Pacific. It cites redeliveries of Airbus A320s and 737s , as well as expanding ATR redeliveries and maintenance work as growth opportunities.


Naturally, many MROs are eyeing component and engine capabilities to broaden their offerings and support of these new aircraft. In the next year or two, expect Ameco Beijing, which performed 1.8 million line-maintenance man-hours in 2012, to add big-thrust engine repair and widebody landing-gear repairs.

Because landing-gear overhauls occur about every 10 years, A320s and 737s delivered around 2003-04 should buoy this market segment. For this reason, Dublin Aerospace, which splits its business between aircraft, landing gear and auxiliary power unit MRO, expects to see the “largest percentage increase in landing-gear overhaul” in the next year or two, says Frank Burke, head of sales.

Malaysian Airlines Engineering & Maintenance expects component repair and overhaul to be its biggest growth opportunities over upcoming years, too.

AFI KLM E&M is focusing on engine and component support but is developing a “worldwide MRO network, close to customers, via its subsidiaries, JVs and partnerships,” says a company spokesman. Examples include opening a component workshop in China this year, launching a joint venture in the U.S. with Bonus Tech and Bonus Aerospace that specializes in engine teardowns, and planning to build a composite and aerostructures workshop at Paris Charles de Gaulle Airport.

Iberia, which became part of the International Airlines Group with British Airways in 2011, has been steadily increasing its maintenance division’s third-party component and engine business in the last couple of years. Part of its success stems from introducing Lean processes, which have increased throughput and decreased turnaround times and costs. New products include IAE V2500 engine and A340 landing-gear MRO—as well as structural and interior airframe modifications. In 2012, Iberia Maintenance performed 122 C and D checks, redelivered 26 aircraft, modified 15 aircraft interiors and completed 18 casualty checks.

British Airways Engineering, which declined to provide its 2012 maintenance man-hour numbers, is busy getting ready for BA to accept its first A380 and 787 this summer. Its Learning Academy at London Heathrow Airport added 787 and A380 and Trent 1000 engine maintenance training classes for customers to leverage the airline’s experience with the new aircraft and systems. In related news, in April it announced that it partnered with AJ Walter Aviation to support Azerbaijan Airlines’ 787 components starting in 2014.

The largest European MRO group in our survey—by both airframe man-hours and revenue—is Lufthansa Technik, whose 4.1 million airframe man-hours include its European facilities in Berlin and Hamburg; Budapest, Hungary; Malta; Shannon, Ireland; and Sofia, Bulgaria, as well as Lufthansa Technik Philippines. Its Malta facility, which celebrated its 10th anniversary last month, logged 750,000 total labor hours—including structural work, painting and cabin modifications—in 2012 for Lufthansa, Brussels Airlines and other international operators.

Lufthansa Technik already offers a comprehensive one-stop shop approach, as well as “total” bundled airframe, engine, material, technical support, landing gear and component packages. And on June 14, it signed a long-term cooperation agreement with supplier Liebherr Aerospace to exchange component process and document management. This could signal prospects for deeper customer-service packages for Liebherr products.

In addition to components and engine capabilities, MROs are expanding backshop offerings—especially for facilities that produce fewer than 1 million man-hours.

Take Adria Airways Tehnika, which is adding interior, sheetmetal, composite and paint services, reports Deputy CEO Mirjana Ceh, whose Slovenian MRO performed 300,000 base maintenance man-hours, plus another 65,000 for line maintenance at its Ljubljana Airport base. She expects a 15% growth in airframe-related services this year, some of which will come from increasing demand for modification work.

Given the MRO market consolidation, strong pricing pressure, overcapacity in some of the mature markets, and declining maintenance requirements for next-generation aircraft coming online, MROs will need to focus on productivity, competitive services and value. And expect the biggest to become even bigger.

AAR started operating part of a former Northwest Airlines facility in Duluth, Minn., in 2011, thereby expanding its network to five facilities. But it “continues to look for viable opportunities to expand both domestically and internationally,” says a company spokesman. AAR’s total man-hours increased 33.5%, from 3.46 million in 2011, and it anticipates growing by 5-10% this year, compared to 2012.

Turkish Technic purchased MNG Teknik in May, which expands its offerings into 757 and 767 maintenance, as well as A300-600 cargo conversions. In 2012, Turkish alone performed 133 C and D checks, and it has 2.8 million man-hours of capacity for heavy maintenance, plus another 1.2 million for component MRO.

Its Habom facility that is scheduled to open by year-end will add another 370,000 sq. meters (4 million sq. ft.) of hangar and workshop space at Sabiha Gokcen International Airport in Istanbul. In addition to heavy maintenance, this location also will be home to the Turkish cabin interiors and seats industry—making it an “aviation campus” for both MRO and manufacturing, according to the company.

But at the same time, medium-size and niche players are flexing their strengths, as well.

Commercial Jet, which completed 800,000 airframe maintenance man-hours in 2012, purchased Pemco World Air Services‘ former complex at Dothan Regional Airport in Alabama to serve as an overflow facility for its Miami operation. Pemco declined to participate in our survey this year, however, two years ago it logged 1.3 million airframe maintenance man-hours.

Airborne Maintenance and Engineering Services, which completed 600,000 heavy maintenance and component man-hours in 2012, started building a two-bay widebody hangar in January, adjacent to its existing facilities in Wilmington, Ohio, that it plans to occupy by the end of first-quarter 2014.

Kalitta Air added 335,000 sq. ft. of hangar and shop space at its facility in Oscodo, Mich. (AW&ST MRO Edition April 15, p. MRO12), while FL Technics plans to add capacity for up to six narrowbodies at Kaunas Airport in Lithuania later this year.

FL Technics, which accrued 360,900 airframe maintenance man-hours last year, accelerated its spare parts capabilities recently with partnership with and Seal Dynamics—along with its own power-by-the-hour type programs in Europe and the Commonwealth of Independent States.

LOT Aircraft Maintenance Services (AMS) in Poland completed 280,000 third-party airframe maintenance man-hours in 2012, plus another 350,000 for line maintenance. MRO for Embraer aircraft comprised the bulk of its 42 C checks in 2012, followed by Boeing 737s and 767s. Within three years, it hopes to double the number of base checks with the help of increased traffic to Poland. In addition, it expects to receive its line-maintenance certification for 787s soon. LOT Polish Airlines, which sold LOT AMS in 2012, was the European launch customer for that aircraft.

Speaking of line maintenance, while our survey excludes line maintenance from the survey tally, it’s important to point out that MROs of all sizes are expanding this capability.

Air Work India expects to add new stations and upgrade existing ones to handle widebodies such as the 777, A330 and A340.

Middle East Aircraft Services Co. (Masco), which completed 57,000 third-party airframe maintenance man-hours in 2012, expects line maintenance to be its biggest growth area during the next few years.

Monarch Aircraft Engineering, which performed 650,000 airframe maintenance man-hours last year, has opened year-around line stations at East Midlands and Leeds Bradford airports in the U.K. A checks and technical management are also offered there.

SIA Engineering expects line maintenance work to grow “in tandem with the regional flight growth expected with the Asean (Association of Southeast Asian Nations) open-skies agreement starting in 2015,” says a company spokeswoman.

In other words, expect growth —especially in Asia-Pacific.


2012 total airframe man-hours by corporate entities

1. Singapore Technologies Aerospace / 11.5 million

2. Haeco Group / 7.4 million

3. AAR Corp. / 4.6 million

4. SIA Engineering Co. / 4.2 million

5. Lufthansa Technik / 4.1 million

6. AFI KLME&M / 3.9 million

7. Timco Aviation Services / 3.2 million

8. Ameco Beijing / 2.8 million

9. Mubadala Aerospace* / 2.5 million

10. Iberia Maintenance / 2.3 million

* Includes ADAT and SR Technics

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