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Global MRO market to gather pace in 2025, but with hurdles

Bernie Baldwin reports on the state in which 2024 has left the MRO industry and gets some pointers about what can be expected in 2025.

If the motto for the real estate industry is “Location, location, location!”, it could well be argued that for aviation’s MRO sector, the phrase might be, “Turn-times, turn-times, turn-times!”. Meeting the goal of optimum turn-times on each and every job is a challenge. So how has the global MRO industry performed in 2024 and what have been the key achievements and developments?

Busy facilities

Jorge Abando, head of aviation industry services at AviaPro Consulting, offers his assessment. “In 2024, the global MRO industry experienced significant demand, continuing its post-pandemic recovery while facing notable challenges,” he remarks. “The sector operated under capacity constraints, largely due to a backlog of maintenance tasks and supply chain disruptions that persisted, though there were improvements compared to previous years.

“MRO facilities have been fully booked well into 2025, creating scheduling pressures for operators. To address this, both MRO providers and aircraft owners have placed an increased emphasis on proactive planning, with operators encouraged to communicate maintenance needs months in advance,” Abando notes.

“As for key achievements, these would include the wider adoption of advanced technologies like predictive maintenance, artificial intelligence (AI), and the Internet of Things (IoT), which have significantly improved operational efficiency. Predictive maintenance, in particular, allows for early identification of issues, reducing downtime and minimising unexpected repairs. Furthermore, MRO providers have expanded their global networks to serve operators across regions better, increasing service capacity through strategic partnerships, especially in emerging markets.”

Abando continues: “Sustainability has also been a major focus in 2024. Many MRO providers have begun integrating eco-friendly practices, such as material recycling and waste reduction, as part of the industry’s commitment to achieving net-zero emissions by 2050. However, the transition to more sustainable practices has led to increased costs and, in some cases, longer turnaround times, as MROs adapt to new regulatory requirements and operational practices.”

Mike Audus, divisional vice-president and business unit manager of aerospace Europe for Ametek MRO also believes that the industry as a whole is busy. “There are still challenges to consider of course, which filter down the supply chain from unreliable airframe deliveries,” he states. “We note that many tier one MROs are repositioning themselves through acquisitions and mergers – and this re-alignment is also evident amongst the smaller repair facilities worldwide.

“The supply chain is improving, but it has not reached pre-Covid-19 levels. This is good and bad for the industry, but for those MROs and trading partners in the USM sector it continues to deliver benefits,” Audus continues. “Aside from this, the return of air travel sees activity right across the industry and for Ametek MRO we are experiencing a very good year. The investments we have made in our portfolio of capabilities, the established relationships that we have nurtured, and the flexibility that underpins what we do for customers are all positively impacting the success and growth of the business.

“Globally the main issue affecting the industry is one of repair capacity. There is increasing evidence of OEMs looking to offload work to reliable partners,” Audus reports.

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(L-R) David Bentley, Muirhead Avionics and Avtech; Mike Audus, AMETEK MRO; and Kevin Ferreiro, VAS Aero Services.

Balancing workforce challenges and MRO demand

For David Bentley, division vice-president and business unit manager of Muirhead Avionics and Avtech – both Ametek MRO group companies – one of the major issues affecting the industry is getting people trained with the right skills. “Over the past five years, many technicians decided to leave the industry or retire, so we have to become increasingly innovative and focused to find the right calibre workforce. Our work with the armed forces is one initiative that is really paying dividends,” he comments.

“Another trend that we are seeing is that repair vendors are still struggling to hit delivery times. The impact of this is a change in business model. Rather than stretch their resources and performance to meet unrealistic targets, they are re-setting the parameters of what they offer customers,” Bentley observes. “These new services are structured to look at world demands and analyse the head count needed, the inventory required, the technologies expected, and so on. This re-setting takes a long time to achieve but we do see businesses presenting a more defined – and in some cases more limited – offer, combining the right people, with the right capacity and the right materials.”

VAS Aero Services’ senior director of business development Kevin Ferreiro asserts that the MRO industry is continuing to rebound. “It is in a much better position than just one and two years ago. This is a vital sector of the industry since passenger traffic continues to accelerate and is expected to exceed 2019 levels by the end of this year (aircraft utilisation has also recovered to 2019 levels). Higher aircraft utilisation rates drive higher maintenance and repair requirements,” he says.

“The MRO sector’s tireless efforts at maintaining active fleets are a major contributor towards the strong financial returns and profitability that operators are experiencing in 2024. As operators await long lead-time deliveries of new aircraft, they are turning to their MRO partners to help extend the life of current assets,” Ferreiro adds. “With this increased demand, MROs have experienced significant maintenance activity backlogs in 2024, and demand has not softened. As a result, many MROs are already selling capacity years into the future.

“The supply chain continues to struggle to deliver new parts and that has resulted in much greater demand for, and reliance upon, used serviceable material (USM) to keep aircraft and engines serviced; however, USM availability, too, remains limited due to continued record low retirement volumes of current generation aircraft.

“The MRO sector continues to suffer from a global shortage of qualified technicians, which impacts the industry’s ability to meet the market’s maintenance and repair demands,” Ferreiro emphasises, echoing Bentley’s opinion.

2025 expectations

Assessments of the past year obviously enable both analysts and practitioners to provide hints at what the MRO market might bring in 2025 – from how full the shops are likely to be to regulatory challenges on the horizon, sustainability efforts, technological developments affecting MRO processes and the training needed to ensure enough personnel to meet demand.

“Looking at capacity and demand, the global MRO market is expected to face continued high demand throughout 2025,” declares Abando. “The backlog experienced in 2024 will likely carry over, particularly for specialised services, as the fleet size continues to grow and more aircraft age into maintenance-heavy phases of their lifecycle. With many MRO shops already booked into 2025, operators may still struggle to secure timely appointments unless either new capacities are added, existing processes are optimised, or both. Flexibility and early scheduling will be critical for operators.

“Regulatory pressures surrounding sustainability will intensify in 2025, especially with the aviation industry’s focus on net-zero carbon emissions by 2050,” he continues. “MRO providers will need to adopt further eco-friendly materials, waste management protocols and energy-efficient processes.

“Compliance with these new regulations could introduce complexities, potentially increasing costs and extending turnaround times. It will be essential for providers to invest in sustainable technologies and processes, as well as for operators to align their maintenance schedules with these changes to minimise disruption,” Abando advises.

“In the area of technological developments, innovation will continue to shape the MRO industry in 2025,” he continues. “The integration of AI, IoT and predictive maintenance systems will become even more prevalent, enabling real-time monitoring of aircraft systems and data-driven maintenance decision-making. Additionally, the use of robotics and automation in maintenance processes is expected to grow, further streamlining repetitive tasks and freeing up skilled technicians for more complex work. These innovations will enhance overall maintenance efficiency and safety, but will require significant investment in infrastructure and training.

“In training and workforce development, the MRO sector will also face a growing challenge in 2025. As experienced technicians retire, the industry must address a widening skills gap,” Abando notes. “While some training programmes have been initiated to cultivate new talent, they may not be enough to meet the increasing demand. MRO providers will need to strengthen partnerships with educational institutions and invest in continuous training to ensure a steady pipeline of skilled technicians. Without sufficient training and recruitment efforts, the shortage of personnel could hinder the industry’s ability to meet growing maintenance demands.”

While Ferreiro is confident of the sector’s increased vibrancy, he too is cautious about how it might be achieved. “Success often creates new challenges, and as the MRO industry continues its upward trajectory from the pandemic-induced contraction we will likely continue to feel some growing pains,” he predicts. “Shortages of skilled labour, raw materials, and maintenance capacity will result in extended maintenance lead times for customers in 2025. That means operators must plan maintenance schedules well in advance to ensure a slot in the queue.”

Ferreiro adds: “Sustainability regulations are vital to evolving industry best practices for the future. Recycling and reclamation will play an important role, helping reduce waste, lower energy consumption and create a more environmentally responsible business model. As a leader in end-of-life aircraft transition management and USM parts re-distribution, VAS is already doing its part to extend the life of vital components and assemblies, while at the same time assuring the availability of critically needed parts to operators worldwide. That said, global dynamics and current headwinds may interfere with realising strong progress in some of these initiatives in the near future.”

Ferreiro anticipates more MRO expansions and partnerships in 2025 to serve the market better, similar to the many examples seen in 2024. “These collaborations are crucial for increasing capacity and producing the innovative and sustainable solutions that help keep assets flying and generating revenue for our MRO customers,” he asserts.

“Addressing the current skilled workforce shortage is vital to the industry being able to meet the growing demand for maintenance and repair services. Training levels are gradually improving, but still remain far behind the required growth rates to satisfy anticipated future market demands,” Ferreiro emphasises.

The Ametek MRO pair of Audus and Bentley also have their predictions for 2025. And when it comes to considering capacity, Audus is straight and to the point. “The shops will be full. There is not enough capacity. There will be more opportunities for strategic partnerships and more acquisitions,” he declares.

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The integration of AI, IoT, and predictive maintenance is set to become increasingly widespread. Credit: sentax/Adobe Stock

Bentley adds: “These moves will need a great understanding of all the data available. But Ametek is a well-known acquirer of MRO businesses, so we actively seek out opportunities and look for the right fit within the group.”

“As an organisation, Ametek MRO is aligned to providing MRO services to the OEMs and end users, so we understand their imperatives of pursuing the very best in terms of cost and performance,” Audus adds. “All shops, like ourselves, need to ensure that turn-times are where the industry wants them to be; we need to deliver what the market needs to operate at maximum efficiency. This means that we too are focused on costs and the coming year will see us asking, is this the new normal for freight, for parts, and so forth? Ultimately, we are measured on four things: quality, safety, turnaround time and price. That will never change.”

Addressing regulatory challenges, Audus highlights that Ametek MRO is always conscious of improving processes and procedures for maximum benefit to its people, its customers and the planet. “This affects all areas of the business from a corporate social responsibility, safety and governance perspective,” he says.

Bentley adds: “We are also aware of other initiatives at a component level such as the movement away from certain coatings on landing gears, for example. As an organisation we ensure we position ourselves to be ready for change when new rules kick in. And we will make whatever investments are necessary in terms of equipment and training.”

Moving on to technological developments, Audus reports that the company has already moved to cloud-based systems and is closely looking at the digital supply chain using AI to “help forecast, manage risk and embed resilience in a volatile global industry”.

According to Bentley, predictive data “needs to be very carefully managed in the dynamic and flexible world of MRO. We need end-toend visibility up and down the supply chain to ensure we have the big picture and can make the best informed decisions,” he comments.

Bentley goes on to address the thorny issue of having enough personnel to meet the demand and how Ametek is approaching the challenge. “Training is a continuous process and embraces all levels and all ages. We start with apprenticeships that are supported by various governmental funding allowances, then at the other end of the spectrum we have older people up-skilling or returning to the workplace as technicians and experienced engineers.

“We also look beyond traditional sources of recruitment and have a highly pro-active initiative to recruit ex-military avionics personnel who train in new techniques. These people have the perfect training and mindset to enhance our team,” Bentley confirms.

If the personnel challenge can be met, MRO companies are clearly in a position to grow in 2025. Elsewhere though, even with the labour relations problems at Boeing – including strike action – now seemingly settled with a pay offer accepted by the unions, their effect is likely to continue to add anxiety to the market.

Intelligent planning, by both the MROs and the airlines, will therefore be crucial to meet the maxim of optimum turn-times.

This feature was first published in MRO Management – November/December 2024. To read the magazine in full, click here.

 

The post Global MRO market to gather pace in 2025, but with hurdles appeared first on Aviation Business News.

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