Home' Asian Aviation : AAV November 2010 Contents 22 AsianAviation | NOVEMBER 2010
After a depressed 2008 and, to a lesser extent,
2009, the commercial aviation maintenance,
repair and overhaul (MRO) market is a business
still facing up to the need to adapt to aviation
industry trends, increase efficiency and minimise
The downturn forced service providers to
compete by shortening turnaround times for
scheduled maintenance even more, without
compromising on quality. At a time when
airlines were cutting capacity and parking
aircraft due to the economic crisis, the MRO
industry suffered correspondingly, with a
massive loss of revenue. This drove struggling
MRO companies to focus even more on costs.
Now, with airlines planning to acquire new
more fuel-efficient aircraft in large numbers as
indications of recovery grow stronger, some
companies see an opportunity to once again
consider expansion of capacity and capability for
new aircraft and engine types, while pursuing
additional work on aircraft they already serve.
The growth of the low-cost carrier business
model is also prompting full-service airlines
to reconfigure their cabins to adapt to the
changing market, while increased cargo loads
stimulate the market for passenger-to-freighter
conversions. All these factors create new
opportunities for MRO companies as travel and
cargo demand rebounds.
Still, despite the rebound, MRO providers are
now concerned that aircraft Original Equipment
Manufacturers (OEM) are gaining a competitive
advantage in aftermarket support. This is
prompting MRO companies to seek new ways
to compete effectively.
Some maintenance providers plan to adopt the
full-service integrator business model by 2012.
MROs will continue to face pressure from
airline customers demanding total maintenance
programmes, which has become a major
selection criterion when for carriers deciding on
a service provider.
Pricing, quality and turnaround times are
decisive for airlines selecting a service provider.
MAS Aerospace Engineering (MASAE)
Managing Director Mohd Roslan Ismail says
airline customers are getting increasingly
demanding, making the business highly
Roslan says that, although there are signs of
recovery, it will probably take three to four years
before the market stabilises.
The Asia-Pacific region is forecast to maintain
its competitive advantage in the field -- especially
over high-cost North America. According to
US-based aviation consultancy Team SAI, MRO
spending will drop 7.5 percent in 2010, to
about US$42.3 billion.
Fleet capacity reductions will account for
a decline of about 4.2 percent. Furthermore,
airframe and line-maintenance costs have
dropped, bringing the market down by another
Reduced aircraft utilisation will drive the
market down a further 9 percent for the year.
The engine MRO sector alone will see a 1.6
percent increase, as labour costs ease. Of the
Airlines have become more cost-conscious than ever, as the industry struggles to find its feet again
following the global economic crisis that took hold in 2008. As a result, maintenance, repair and overhaul
service providers need to adapt to the modified needs of the airlines they serve. Asian Aviation presents an
overview of the industry with summaries of key Asia-Pacific players' activities. William Dennis reports.
MRO business adapts to changing needs
The aircraft MRO industry suffered a massive loss of
revenue as a result of the global economic crisis.
China's healthy economy will be a major driver
of growth in MRO demand in the region.
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