Market Dynamics
Maintenance, Repair, and Overhaul (MRO) operations are crucial for maintaining the safety and efficiency of aircraft operations. These activities encompass routine inspections, preventive maintenance, troubleshooting, component repair, and major overhauls, all intending to ensure airworthiness and safety standards are upheld.
Specialized organizations conduct these services, playing an essential role in maintaining the requisite safety standards for aircraft operations.
Recent Market JVs and Acquisitions
A huge number of strategic alliances including M&As, JVs, etc. have been performed over the past few years:
- In February 2024, AAR and Air Canada entered a letter of intent for a ten-year, renewable agreement for airframe maintenance.
- In January 2024, AAR Corp. announced a new multi-year agreement with Ontic, granting AAR distribution rights to supply a strategic selection of military products to the U.S. government, with exclusivity on specified parts.
- In November 2023, the Defense Logistics Agency awarded Pratt & Whitney a US$ 870 million long-term contract to provide comprehensive services to a fleet of almost 1,000 engines powering B-52s and E-3s.
- In November 2023, Triumph Group, Inc. was selected by Honeywell Aerospace to provide the next-generation Electronic Control Unit (ECU) for future Auxiliary Power Unit (APU) models for both commercial and non-commercial aircraft.
COVID-19 Impact
The COVID-19 pandemic's sudden onset had a profound impact on the entire aviation industry, affecting both production and services. This disruption led to a significant decrease in air travel demand, resulting in grounded fleets and reduced MRO activities. The industry faced unprecedented challenges as it grappled with navigating through these turbulent times.
Despite its status as a substantial market, the aerospace MRO business was inevitably affected by the repercussions of the COVID-19 pandemic. However, the North American market notably demonstrated resilience, experiencing a robust recovery from the pandemic's effects.
By the year 2022, the region's civil aviation business had rebounded significantly, returning to profitability. Furthermore, an incessant shift to air travel and rising geopolitical tensions are likely to give impetus to the demand for MRO activities.
Segments Analysis
Segmentations
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List of Sub-Segments
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Dominant and Fastest-Growing Segments
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Aircraft-Type Analysis
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Commercial Aircraft, Turboprops, Regional Aircraft, Military Aircraft, and Helicopters
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Military aircraft are expected to be the demand generator for MRO in North America, whereas commercial aircraft are likely to grow at the fastest rate in the coming years.
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MRO-Type Analysis
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Airframe MRO, Engine MRO, Component MRO, and Line MRO
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Engine MRO is anticipated to contribute the largest share of the North American MRO spending.
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Country Analysis
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The USA, Canada, and Mexico
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The USA is expected to maintain its reign over the forecast period, whereas Mexico is likely to grow at the fastest rate.
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By Aircraft Type
"Military aircraft are expected to remain dominant whereas commercial aircraft will be the fastest-growing aircraft type in the market during the forecast period".
The North American aerospace MRO market is segmented into commercial aircraft, turboprops, regional aircraft, military aircraft, and helicopters. Military aircraft are expected to remain dominant whereas commercial aircraft will be the fastest-growing aircraft type in the market during the forecast period.
North America's military aircraft fleet is the world's largest, with 14,096 aircraft across the Army, Navy, and Air Force. In addition to that, governments allocate substantial budgets for defense operations in North America. As a result, there is a consistent demand for maintenance, repair, and overhaul services for military aircraft to ensure operational readiness and safety.
The fastest growth for the MRO needs of commercial aircraft is primarily due to the expanding commercial aircraft fleet, increasing domestic and international air travel demand, growing aging aircraft fleet size, and investment in new aircraft.
By MRO Type
"Engine MRO is expected to remain the dominant and fastest-growing MRO type in the market during the forecast period".
The market is segmented into airframe MRO, engine MRO, component MRO, and line MRO. Engine MRO is expected to remain the dominant and fastest-growing MRO type in the market during the forecast period. The demand for engine MRO is propelled during the forecast period by the concurrent development of new engine technologies, fleet expansion initiatives, and the implementation of stringent safety regulations.
In addition to that, it is projected that the North American engine fleet will increase from 19,300 active engines in 2023 to 22,200 active engines in 2032. This will further strengthen the demand for engine MRO during the forecast period.
Country Analysis
"The USA is expected to maintain its reign over the forecast period, whereas Mexico is likely to grow at the fastest rate".
In terms of countries, the USA is expected to remain the largest market for North American aerospace MRO during the forecast period. The USA's dominant position in the aviation industry is significantly bolstered by several key factors, including its expansive fleet size, robust aviation infrastructure, extensive network of airports, well-established maintenance facilities, and highly efficient logistics infrastructure.
In addition to that, the presence of a huge number of MRO providers and airlines in the country is expected to fuel the market during the forecast period. Mexico, particularly driven by Growing investment projects by multinational aerospace companies, is expected to grow at the fastest rate during the forecast period.
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