Military MRO Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2033)

Military MRO Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2033)

The Military Aviation Maintenance, Repair, and Overhaul Market size is estimated at USD 36.94 billion in 2024, and is expected to reach USD 47.52 billion by 2033, growing at a CAGR of 2.84% during the forecast period (2024-2033).

The military aviation sector has witnessed a mild impact of the COVID-19 pandemic. Growing defense expenditure and rising procurement contracts for fighter jets led to steady growth in the market. Supply chain disruptions, production halt from MRO players, and economic slowdown hinder market growth during the pandemic. The market showcased a strong recovery post-pandemic due to the increasing number of military modernization programs.

The military aviation MRO market is experiencing steady growth due to the increasing demand for maintenance, repair, and overhaul services for military aircraft. The demand is driven by factors such as expanding military fleets, the need for lifecycle extension of existing aircraft, and the rising complexity of aircraft systems. The procurement of new military aircraft leads to larger fleet size, subsequently increasing the demand for MRO services to support these aircraft throughout their operational lifespan.

Defense organizations seek to maximize the value and longevity of their aircraft assets. The market for MRO services is experiencing growth, driven by the need for structural repairs, avionics upgrades, engine overhauls, and system modifications. The evolution of technology in military aircraft, such as advanced materials, avionics, and mission systems, contributes to the growth of the MRO market. As aircraft become more sophisticated, specialized expertise and advanced diagnostics tools are required to maintain and repair these complex systems effectively.

Military Aircraft MRO Market Trends

Fixed-Wing Aircraft Segment Will Showcase the Highest Growth During the Forecast Period

Fixed-wing aircraft segment is projected to show significant growth in the military aviation MRO market during the forecast period. The growth is attributed to the increasing demand for fighter jets and rising expenditure on improving military aviation capabilities from the defense forces. The United States and Russia have the highest number of military aircraft due to higher expenditures on the procurement of next-generation fighter jets. Rising warfare situations, political disputes among neighboring countries, and a growing number of cross-border conflicts lead to growing spending on the defense sector. The United States has the highest military aircraft fleet of 13,232 in 2021, followed by Russia, with a fleet of 4,143 aircraft. Fixed-wing aircraft in the armed forces play critical roles during war or special missions. This always necessitates proper maintenance of this aircraft and requires upgrades after certain years of operation to extend its service life.

In June 2023, the Norwegian Defense Materiel Agency (NDMA) signed an extension contract with Kongsberg Aviation Maintenance Services to overhaul and make ready-for-sale a total of 32 F-16 combat aircraft. The contract also includes technical assistance and support for training Romanian technical personnel. The value of the contract was over USD 63.61 million. In April 2023, GE Aerospace signed an agreement with Lockheed Martin Corporation to support avionics and electrical power systems on the F-35 military aircraft. Under the four-year agreement, the company will provide MRO services for GE Aerospace systems on the F-35 Lightning II aircraft. The company will service the F-35 systems at its repair and maintenance locations in California, Georgia, and Utah. Thus, growing procurement of fighter jets and rising expenditure on military aircraft modernization programs drive the growth of the market during the forecast period.

North America to Dominate Market Share

North America held the highest shares in the market and continued its domination during the forecast period. The growth is due to the presence of the largest military aircraft fleet, growing spending on enhancing US Air Force (USAF) capabilities, and rising aircraft modernization programs.

The US currently has the largest fleet of military aircraft in the world. In 2023, the country operates a fleet of 2,757 combat aircraft, 731 special mission aircraft, 632 tanker aircraft, 962 transport aircraft, 5,584 combat helicopters, and 2,634 training aircraft/ helicopters. The major driving factor for the MRO in this country is the significant demand to upgrade such a vast fleet with the latest technologies and systems. The US Department of Defense (DoD) plans to spend USD 61.1 billion on aircraft and related systems in 2024. The DoD plans to buy a diverse mix of 270 aircraft, ranging from nearly USD 700 million B-21 stealth bombers for the USAF to twin-engine King Air 200-derived trainers for the US Navy.

In FY2021, the US DoD received USD 32.5 billion for procurement, and research, operations & maintenance, development, test, and evaluation appropriations for depot maintenance activities. The US DoD budget requests for FY2022 and FY2023 depot maintenance reached USD 32.6 and USD 35.1 billion, respectively. According to DoD, the FY2023 budget request would fund 50% of total executable Army depot maintenance requirements, 85% of Air Force requirements, 80% of Marine Corps requirements, 71% of Navy requirements, and 83% of Space Force requirements. The majority of the MRO expenditure is on the nation's large fleet of multi-role aircraft, transport aircraft, and surveillance aircraft that require high maintenance on engines and airframes, along with field and component maintenance services.

Military Aircraft MRO Industry Overview

The market is fragmented, with numerous local and international players providing various MRO services to the existing military aircraft fleet. The major players in the military aviation MRO market are Lockheed Martin Corporation, Safran, The Boeing Company, Raytheon Technologies Corporation, and BAE Systems plc.

Strategic partnerships between the players may help them gain more contracts while expanding their reach to untapped markets in the long run. As most MRO contracts are for the long term, it could be a time-consuming process for new players to establish themselves in the market by competing with the existing ones. Artificial intelligence (AI)-based predictive maintenance technologies are also envisioned to witness mass adoption during the forecast period. Potential investments would be required to enhance the IT capabilities of MRO operators for maintenance execution, supply chain management, enhancing mobility, and adopting e-signatures. Advanced data analytics are also being used by MROs for inventory optimization to plan, stock, and optimize spares as and when required at minimal procurement costs. Such tools enable operators to function efficiently, derive maximum profits, and support the digitization of global aircraft MRO operations.

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