Asia-Pacific Aircraft Engine MRO Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

Asia-Pacific Aircraft Engine MRO Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

The Asia-Pacific Aircraft Engine MRO market was valued at USD 12.55 billion in 2022 and is projected to grow at a CAGR of 3.33% during the forecast period.

The COVID-19 outbreak severely impacted the entire aviation industry in the Asia-Pacific. Nevertheless, in the present scenario, aircraft operators in the region have resumed ordering new aircraft owing to a rebound in travel demand in the commercial and general aviation segments. This will boost aircraft engine MRO providers in the region during the forecast period.

The substantial rise in passenger traffic in the Asia-Pacific, coupled with the imposition of new emission regulations, has led to a significant increase in the demand for new-generation aircraft purchases over the last decade. The aging military aircraft fleet in some countries of the Asia-Pacific region may generate significant demand, as countries such as China, India, and Japan, amongst others, plan to extend these aging aircraft's service life.

Rapid technological advancements in aircraft engine MRO are driving the market growth. Key players have now started investing significant amounts in R&D to manufacture advanced aircraft engine components using different composites, increasing their operability for various operating environments and making the engines lighter while improving their operational life. Moreover, the region is also expected to be the largest MRO service user in the coming years. A natural corollary of fleet acquisition owing to the various countries of the Asia-Pacific, such as India and China, which are poised to emerge as a powerhouse in the coming years, will drive the growth of the market.

The turbine engine segment held the highest shares in the market and continued its domination during the forecast period. Growing air traffic leads to increasing aircraft deliveries, rising air cargo transportation, and increasing demand for general aviation aircraft driving the market growth. The turbine engine is a rotary engine that converts the kinetic energy of a moving fluid (water, steam, air, or combustion products of a fuel) into mechanical energy. Turboprop, turbofan, and turboshaft are various types of turbine engines. Asia-Pacific is witnessing several strategic collaborations to cater to the diverse requirements of the different aviation platforms.

For instance, in February 2023, Hindustan Aeronautics Limited (HAL) and General Atomics Aeronautical Systems Incorporated (GA-ASI) announced that the HAL Engine Division in Bengaluru will support the turbo-propeller engines that power the MQ-9B Guardian High Altitude Long Endurance (HALE) Remotely Piloted Aircraft System (RPAS). Furthermore, in September 2022, Air China and Rolls-Royce entered a new joint venture for engine maintenance, repair, and overhaul (MRO). Beijing Aero Engine Services Company Ltd (BAESL), a new joint venture, will provide MRO service for Rolls-Royce Trent 700, Trent XWB-84, and Trent 1000 aviation engines. Air China and Rolls-Royce each own 50% of the joint venture, which has a contract worth around USD 378.2 million. Thus, increasing aircraft engine MRO contracts and growing spending on aircraft modernization programs drive market growth during the forecast period.

China dominated in terms of market share and is also expected to witness the highest growth in the region during the forecast period. An increase in the number of air passengers, rising expenditure on the aviation sector, and growing aircraft modernization programs from airlines drive market growth across the country. China became the largest aviation market in terms of passenger capacity in 2020. According to the Civil Aviation Authority of China, during the Lunar New Year 2023, from Jan 7 to Feb 15, a total of 9 million passengers traveled via air, an increase of 39% compared to 2022’s Lunar New Year.

Owing to the high potential for market growth, various MRO service providers and airlines are partnering to cater to the airworthiness of aircraft. For instance, Air China, in September 2022, announced that they are entering a Joint Venture (JV) maintenance, repair, and overhaul (MRO) facility in China. The new facility, Beijing Aero Engine Services Company Limited, will provide MRO support on the Rolls-Royce Trent 700, Trent XWB-84, and Trent 1000 aero engines. Air China and Rolls-Royce each hold 50% of the shares in the joint venture with a contract amount of about 2.61 billion yuan (about USD 378.2 million).

Furthermore, in February 2022, Safran SA, a major aircraft engine manufacturer based out of France, announced the opening of a new MRO facility in Suzhou, China. The facility is being set up and is expected to be operational by the end of 2022. The company-owned 5,200 sq meter repair station helps it in strategic commitments, linking it to its MRO facilities across the Middle-Eastern and Indian facilities, making the company an optimal choice for MRO services for major airlines across the world. Thus, increasing aircraft engine MRO contracts, and growing spending on the aviation sector drive market growth across the country.

The Asia-Pacific aircraft engine MRO market is highly competitive and is marked by the presence of many prominent players, such as Safran SA, General Electric Company, Rolls Royce plc, GMF AeroAsia, and HAECO Group competing for a larger market share. Key engine MRO service providers focus on providing advanced services through next-generation technologies. Furthermore, the major players in the market are focusing on business expansion through mergers & acquisitions, partnerships, and contracts with airlines. On March 2022, Helicopter Engines MRO Pvt Limited (HE-MRO), a joint venture between Hindustan Aeronautics Limited and Safran, opened its new facility in Goa, India. According to HAL, the new facility will be operational by the end of 2023 with a planned capacity of 50 engines per year and a total power of 150 engines per year. The MoU signed by HAL with Safran under the Indian government’s Atmanirbhar Bharat vision of achieving self-reliance in defense technologies and MRO.

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