KUALA LUMPUR: The global aircraft maintenance, repair and overhaul (MRO) spend will grow by 2.2 per cent annually in the next 10 years from US$112 billion (RM523.8 billion) in 2023 to US$139 billion (RM649.9 billion) by 2033, leaving aside the impact of inflation.
Alton Aviation Consultancy, in its annual Global MRO Demand Forecast, said the growth would be driven by the faster than expected air travel recovery and fewer aircraft retirements.
The delay in aircraft retirements is due to the supply chain challenges, which in turn is boosting MRO spend with older aircraft requiring more maintenance intensive overhauls.
MRO spending has also increased due to higher material costs and labour costs and inflation.
Alton Aviation managing director and co-author of the report Adam Guthorn said the MRO growth is being driven by strong demand in Asia Pacific, which accounts for 35 per cent of global MRO demand worldwide, while North America and Europe each represent around 20 per cent of global demand.
"Narrow-body jets will contribute the largest MRO demand, growing from its current share of 54 per cent of total demand to 63 percent over the next 10 years, in line with the growth of the global narrow-body fleet," he said in the report.
According to the report, there is also uneven demand in terms of MRO segments with engines the largest contributor, accounting for 52 per cent of spend in 2022.
"With new generation engines gradually replacing mature generation engines, we anticipate that overhaul events of new generation engines will increase from 25 per cent of total events in 2023 to 69 per cent by 2033.
"Poor reliability of new generation engines is also impacting the MRO market, with many new generation engines having shop visits at intervals much sooner than their predecessor engines," Guthorn said.
Alton Aviation director and co-author of the Global MRO Demand Forecast report, Joshua Ng said an additional contributor to the MRO growth will be the modifications sector which continues to grow faster than the overall rate of the industry.
He said airlines are seeking to optimise their aircraft configurations to improve profitability by implementing cabin modifications more frequently as they compete on product quality.
According to the report, significant spend is expected in passenger-to-freighter aircraft conversions, in-flight connectivity, and cabin interior modification programs.