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At the Crossroads

Growth is expected to be slow in the mature European MRO market, but opportunities
remain for companies with the right strategies

By Arun Sivasankaran
there is unCertAintY on the horizon, As in other regions, companies in Europe
the market is fiercely competitive and growth have started to reshape maintenance
over the next decade is expected to be slow, strategies based on the fact that carriers are
but there is hope still for companies in the operating older generation aircraft longer,
European MRO market that are prepared thus delaying the influx of new aircraft like
to innovate, expand and adapt to changing the 787 and A350. The farsighted among
conditions. the companies have begun investing in new
In keeping with the global nature of technologies, aware that the global fleet is
the industry and the increasing number going to look markedly different in ten years.
of partnerships across regions that one is
witnessing in recent times, the European By the Numbers
market reflects some of the global trends According Oliver Wyman’s 2017-2027 MRO
such as industry consolidation and an Market forecast, commercial airline MRO
increasing focus on new technologies spend will grow from of US$75.6 billion to
to handle new generation aircraft. Local over US$109 billion by 2027, representing a
factors such as a tense business climate 3.8 percent compound annual growth rate
Low Cost Carriers (LCCs) such as have also had had impact on the market, as (CAGR) over the 10-year period. Much of the
Ryanair have moved past legacy has the fact that MROs in Western Europe growth will be due to India and China, which
carriers in Europe. The Irish
low-cost airline carried more have particularly struggled with finding and are expected to see MRO growth of 10.1
passengers than Lufthansa in 2016 retaining skilled technicians. percent and 6.7 percent respectively.
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