Middle-East and Africa Aircraft Engine MRO Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Middle-East and Africa Aircraft Engine MRO Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Middle-East and Africa aircraft engine MRO market is expected to exhibit a growth rate of over 4% during the forecast period.

The Covid-19 pandemic has significantly impacted the revenue streams of the major full-service carriers in the region, as they rely immensely on international travel. Furthermore, while domestic travel has witnessed a significant rebound all over the world, the market for such travel is low in the Middle-East. On the other hand, several Airlines in Africa are still awaiting government aid to come out of bankruptcy. Several airlines in the region have opted for early retirement of the aircraft to reduce operational and maintenance expenses, which might increase the availability of green time engines in the market.

Over the years, several global and regional MRO service providers such as Lufthansa Technik, AMAC Aerospace, JORAMCO, etc. have expanded their MRO service network in the region through partnerships and joint ventures. This factor has propelled the growth of the aircraft MRO and related engine MRO market in the Middle-East and Africa Region.

Major regional economic powers such as Saudi Arabia, Israel, Turkey, Iran, Egypt etc. are spending significant amounts towards the procurement of new aircraft. Also several countries, especially in the African region, are focusing on the procurement of refurbished aircraft and upgradation of existing military aircraft fleet. This factor is significantly driving the growth of aircraft engine MRO market in the region.

Countries in the region such as Saudi Arabia, United Arab Emirates, and Qatar are actively participating in programs such as Carbon Reduction and Offsetting Scheme for International Aviation (CORSIA) and other nations are expected to join the aviation emission curbing programs soon. This factor is also supporting the growth of the aircraft engine MRO market.

Key Market TrendsCommercial Aviation Segment to Exhibit the Highest Growth Rate During the Forecast Period

The Covid-19 pandemic has significantly affected the passenger traffic in the region in 2020 and 2021. Nevertheless, major airlines in the region including the Emirates, Etihad, and Qatar Airways have shifted their focus on the air cargo business, which has helped them mitigate the losses due to the diminished passenger demand. With the increasing pace of vaccinations in the Middle-East, international travel from the countries is also expected to rebound in the next 3-4 years. Domestic traffic is expected to recover at a faster pace, which will drive a shift in the distribution of passengers within the region, and might contribute to the narrow-body fleet additions in the coming years. These deliveries might compensate for some of the widebody engine MRO demand lost due to the reduced deliveries and increased widebody retirements in the region. On the other hand, several airlines in Africa are reeling from the financial crisis that is further compounded by the advent of the pandemic. Airlines in Africa are awaiting government responses in terms of financial aid, to help them emerge out of the pandemic. A significant portion of the aircraft fleets of these airlines still remains in storage. These aircraft are expected to generate significant demand for engine MRO before they fly again. Also, Africa is expected to continue its reliance on migrations for fleet growth, especially from the Middle-East and Europe regions during the forecast period. Airlines in the regions are also expected to opt for green-time engines instead of procuring new engines to reduce costs. However, this is expected to increase the need for MRO for these engines in the years to come. Such factors are expected to drive the demand for commercial aircraft engine MRO services in the region during the forecast period.

United Arab Emirates is Expected to Remain a Key Market for Engine MRO Services in the Years to Come

The United Arab Emirates is home to major airlines such as Etihad Airways and Emirates that were rapidly expanding and upgrading their fleet of passenger and cargo aircraft before the advent of the pandemic. With the advent of the pandemic, these airlines are now focusing on increasing their presence in the LCC sector, with the help of partnerships with other airlines. For instance, Air Arabia Abu Dhabi, which started its operations in mid-2020, is a joint venture between Etihad Aviation Group and Air Arabia has become the first low-cost carrier based out of the UAE capital. Although airlines in the country possess significant MRO capabilities, they still depend on engine OEMs and third-party providers for engine maintenance. This has helped engine MRO providers to increase their market in the country in recent years. For instance, in late 2019, Sanad, a major local engine MRO provider, signed a cooperation agreement with the Emirates Engine Maintenance Center (EEMC) to work together to create new business opportunities via the development of dedicated repair and training facilities in the country. Sanad also plans to expand its existing maintenance and repair services to include the full overhaul of 315 GEnx engines until 2035. On the other hand, the United Arab Emirates aims to enhance its defense capabilities not only by procuring new aircraft but also by developing inherent MRO capabilities. ​The country has been expanding its military aircrat fleet by procuring several new fighter jets and transport/tanker aircraft. On the other hand, in November 2021, GAL, part of the EDGE Group, announced they have signed an agreement for Sanad to provide MRO services for Rolls Royce Trent 700 engines that power the UAE’s Airbus A330 Multi Role Tanker Transport (MRTT) fleet. Furthermore, the United Arab Emirates is increasing its spending on the development of tourism and business ecosystem and this is propelling the demand for general aviation aircraft and general aviation aircraft engine MRO market in the country.

Competitive Landscape

The aircraft engine MRO market in the Middle-East and Africa region is fragmented. Some of the prominent players in this market are Safran SA, General Electric Company, Lufthansa Technik, CFM International, and Jordan Aircraft Maintenance Limited among others. In Middle-East and Africa, OEMs control a majority share of the aircraft engine MRO market, with the other half roughly split between independent and airline overhaul shops. For new powerplant generations specifically, operators frequently outsource engine maintenance and use full MRO-support programs. Hence, most expansion projects in the regions are partnerships of airlines or third-party providers with engine OEMs. Also, several global MRO service providers are entering the Middle-East and Africa market through contracts, joint ventures or collaborations, etc. This is expected to further transform the market into a more competitive one in the years to come.

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Companies Mentioned
 
Safran SA
General Electric Company
Rolls Royce Holding PLC
Pratt & Whitney (Raytheon Technologies Corporation)
Lufthansa Technik AG
Jordan Aircraft Maintenance Limited
Lockheed Martin Corporation
CFM International
Honeywell International Inc.
AMMROC
Emirates Engineering
Sanad

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