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The MRO Outlook for 2025

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By David Dundas

There is no question that 2024 was a challenging year on many fronts for the MRO sector of the aerospace industry. Wherever you look, it is difficult to find consistency, making it hard for all MRO operators to plan ahead with a high degree of confidence. While on the one hand it is encouraging to see hopefully putting its safety issues behind it and moving forward to uninterrupted production of all its models next year, on the other hand, not all carriers have come through the pandemic unscathed and some have either had to scale back operations to remain viable, or even filed for . Supply chain problems have not only hit both aircraft manufacturers including Airbus and Boeing, but also MRO operators who rely heavily on the availability of engines and their spare parts, leading to further uncertainty.

So, what does 2025 hold for the MRO sector? We thought the best way to find out was to seek the opinion of seven leading MRO operators to see what they feel lies ahead for them.

Today versus tomorrow

We wanted to know what operators felt was the state of play today and what, if anything might change in 2025. Denis Brailsford, Head of Asset Management at IBA sees engines as the key area both today and tomorrow. He comments: “Demand is outstripping capacity, especially in the engine MRO space. The newest generation engines are continuing to place strain on MRO capacity, with airlines having to ground aircraft. We forecast this to remain a problem in 2025 and 2026, with several airlines, including Wizz Air, highlighting that the issue will continue to limit their growth in 2025. This capacity strain is further increased by the continuing challenges in the supply chain, therefore increasing the overall turnaround time of aircraft and engines in for shop visits,” adding that, “In summary, we forecast that MRO slot availability will continue to be limited.”

At Panasonic Avionics, the company's Vice President of Panasonic Technical Services (PTS), Tom Eskola, sees the advances in technology, along with the fact that aircraft are currently staying in service longer than initially planned as having a major influence. “The MRO industry has grown significantly in the past several years and is projected to continue this trajectory due to several factors. First, aircraft are staying in service longer due to a lack of new aircraft deliveries to airlines. This drives higher repair requirements and potentially sustaining older systems beyond their planned lifecycle. Second, airline demand is increasing due to additional capacity, more routes and higher load factors. MRO performance is scrutinised more than ever, and performance needs to be high. Third, technology is advancing fast with the introduction of AI for predictive and preventative maintenance. This new technology can introduce new capabilities and challenges for integration with older systems,” he says.

Tulika Dayal, Chief Experience Officer & Co-founder of Sky Select Inc., sees five key drivers for the current state of transformation in the MRO sector: Recovery from the pandemic, adoption of digital technologies, increased demand for air trave, the navigation of supply chain challenges, and a continued focus on sustainability. As for 2025, she sees that: The strategic integration of advanced technologies will fundamentally enhance maintenance processes, driving the industry forward and that predictive maintenance is set to take the forefront, fostering a proactive maintenance culture that reduces unplanned downtime and boosts operational reliability. In addition, as sustainability becomes integral, organisations will prioritise adopting sustainable materials and energy-efficient practices, with technology proving to be a vital enabler. Beyond this, she believes that investing in workforce development will be essential to bridging the skills gap and attracting top talent, ensuring the industry's growth and innovation capabilities are matched by skilled professionals.

Lewis Prebble, President – Airlines & Fleets at StandardAero is extremely positive as he sees that “Overall, the MRO industry remains healthy, reflecting the underlying strength of the global air transport market,” though he does recognise the challenges created by supply chain problems. However, that current positivity also extends through to 2025 as he comments: “For 2025, we foresee incremental improvements rather than any major changes:  IATA is forecasting a 4.4% increase in air transport revenues.  We expect the utilization of older generation narrowbodies to remain strong, regardless of the improving delivery volumes of the A320neo and 737 MAX families.” At Ascent Aviation Services, Scott Butler, the Chief Commercial Officer is slightly more reserved regarding the current situation, but he also sees a light at the end of the tunnel where 2025 is concerned.  “While there are still several headwinds in the industry, like OEM issues & manpower shortage, I believe that for 2025, there are positive signs that will give the MRO industry more opportunity to invest and improve,” he advises.

Tommy Hughes, Chief Executive Officer at VAS Aero Services is equally as positive as Lewis Prebble, seeing 2024 as a year of recovery after the pandemic, commenting that “I would describe 2024 as a “bounce back” year for MROs, having weathered the storm of the Covid-19 pandemic and subsequent supply chain disruptions.  This period hasn't been without its challenges, as we still witness gaps, but the good news is we're now dealing with issues related to growth, rather than cutting back. For 2025 I believe the focus will be on increasing the MRO workforce numbers and capabilities, adopting new technologies that will allow us to support future generation aircraft and increasing our sustainability efforts.”

It is perhaps fair to say that Mike Cazaz, President & CEO at Werner Aero, LLC has adopted a more pragmatic and perhaps realistic approach to the current and near-term situation, highlighting what he feels will be continued supply chain problems, commenting that: “The MRO industry is still unstable mainly due to external issues.  The supply chain problems are still having a major toll on the market, especially around engines.  These supply chain issues are causing major delays in repairing engines but also some critical aircraft parts.  In addition, the lack of expert personnel across the industry and regions is still a problem.  The newer model engines that require unscheduled shop visits must wait many months before they can be inducted simply because the industry does not have the capacity (slots) to handle the demand.  These issues existed in 2024 and will continue throughout 2025.  I can't say it's a major change but for sure still a major disruption.”

What is driving growth in the MRO sector and are there any foreseen barriers?

Tom Eskola sees plenty of potential growth for Panasonic Avionics through diversification – “For example, at PTS, we've expanded from exclusively focusing on in- entertainment (IFE) maintenance to offering a comprehensive range of line maintenance services,” adding that “This diversification has been a key growth area for us, especially since the expansion into full line maintenance began just before COVID-19.” In terms of foreseen barriers, he has certain concerns: “The MRO sector relies heavily on infrastructure, skilled labour, and regulatory compliance, all of which require significant investment and careful management. Supply chain challenges and fluctuating demand, especially during geopolitical disruptions, can also pose risks.”

Depending on the company's focus where MRO services are concerned, the current growth factors and potential barriers can differ greatly. For SkySelect, Tulika Dayal sees fleet expansion, ageing fleets, technological advancements, outsourcing trends and regulatory compliance all as key factors affecting growth. In terms of barriers to growth, she feels that global supply chain disruptions, economic downturns, skill shortages, regulatory complexity and environmental regulations will be the prime culprits. Lewis Prebble is pretty much in harmony with Tulika in terms of seeing extended service lives of aircraft as a driver for MRO growth, but sees tariff wars as a potential barrier to growth, “as could any expansion to the various regional conflicts impacting various parts of the globe in 2024,” he says, before adding that: “ the availability of good quality USM and green time assets continues to shrink (as they are used up), thereby reducing the industry's ability to compensate for new parts shortages. Those barrier differences are also highlighted by Scott Butler when it comes to investing in the future, pointing out that: “The sheer volume of new aircraft entering the worldwide fleet is an encouraging sign.  There is, however, a shift of aircraft fleet types due to aging aircraft, so MROs may be hesitant to invest in older aircraft types without a clear future market”

An increase in air traffic and delays in the delivery of new aircraft have increased operators' reliance on MROs to keep their assets flying.  Cycles and flight hours of current aircraft continue to increase, adding to their maintenance requirements, and the continuing shortage of critical parts provides an opportunity for companies like VAS Aero Services who specialise in aircraft teardown and parts re-distribution, according to Tommy Hughes. In terms of barriers, he is quite blunt: “…as an industry we must continue to overcome issues related to staffing shortages while also keeping pace with the digital transformation taking place that impacts every aspect of our business.” Where MRO growth is concerned, Mike Cazaz is very clear: “With more shop capacities, technology that will streamline the repair process and AI that will possibly replace the human and will drive results faster, these could mean major improvements and growth in the industry.  In addition, I believe that we will see continued consolidations driven by OEMs or private equity companies which will cause new emphasis on driving growth as the investors will wish to see the returns on those investments.”

Denis Brailsford raises an interesting point concerning training and skill shortages, which seem very relevant yet overshadowed by supply chain problems and aging fleets. As he points out: “Investment in the MRO sector continues with growth in both Asia and the Middle East. However, the speed at which skilled personnel can be trained still remains a primary barrier to growth. As a result, we have seen a number of states and airlines in these regions enter into Memorandums of Understanding (MOU), to provide support and training in the region, with the likes of Saudi Arabia and Air France KLM entering into a MOU for GE90 engines. We see such agreements continuing to support regions where significant growth is needed.” He concludes: “This skill shortage is not limited to developing regions. The skills shortage is set to continue in developed regions, with the Aviation Technician Education Council (ATEC) reporting that 30% of technicians in the U.S. are at or close to retirement age, with the average age of aviation technicians being 51 years old.”

Will new materials such as composites affect demand for certain MRO services?

Lewis Prebble is very clear cut on the engine side of things, as he explains: “We are seeing this trend in the engine segment, driven by new generation powerplants such as the CFM LEAP and P&W GTF.  On the LEAP-1A and LEAP-1B, the engine utilizes composites in a range of components – from the fan blades and case to the combustor lines and domes – which require specialist repairs, and StandardAero's Component Repair Services (CRS) team is growing its range of advanced composite repair technologies to support this platform.” However, and curiously, Tommy Hughes sees an upside to supply chain problems as new materials bring new challenges to the MRO sector, pointing out that: “The demand for specialised composite repair capabilities, advanced inspection techniques, and new manufacturing methods like additive manufacturing is sure to increase.  At what velocity?  That's something that's really being determined by the supply chain. But that does give MROs time to prepare by investing in training, equipment, and processes to handle these advanced materials. We'll also have to increase our knowledge to incorporate composite recycling into our ongoing sustainability efforts.”

Of course, MRO has a new field, that of electric aircraft, which Scott Butler suggests one should keep an eye on where the demand for avionics technicians is concerned. “While composite repairs are picking up in modern aircraft, the shift towards avionics technicians for more electrical aircraft is something to keep a pulse on.  Additionally, with the aging fleets still flying in large numbers, as well as more conversion programmes ongoing, structures mechanics and NDT are in great demand,” he says. Meanwhile, Denis Brailsford draws our attention to the importance of AOG composite teams as he explains: “MROs have been working with composite structures for many years and have continued to develop their capabilities as the use of composite structures has increased. Traditionally composite component overhauls would be performed by dedicated composite shops; however, more on-wing composite repair techniques are being developed to reduce the number of component removals, which is driving an increase in AOG composite teams being used.”

And then, of course, you have a key direct beneficiary from the use of new materials. As Tom Eskola points out: “Maintenance budgets are finite and any work outside of flight-critical needs – such as ones related to the passenger experience – is often de-prioritised by airlines or deferred.  But as manufacturers increasingly adopt materials with enhanced durability that reduce frequency of repairs, more attention and resources are devoted to the passenger experience.”

What are today's and what will be tomorrows greatest workforce challenges?

There is a recurring theme with our responses to this question, and that is the presence of a skilled workforce and all the subsequent problems that come with creating and maintaining one.

Lewis Prebble in unequivocal when identifying the supply of skilled mechanics in both instances. “The biggest challenges relate to ensuring a reliable supply of skilled aircraft engine mechanics, and to retaining these skilled workers.  To tackle the first challenge, we partner closely with local colleges to develop aircraft turbine technician courses, which then enable us to offer students well-paid and rewarding careers upon graduation.  We have also launched a 12-week on-the-job training programme at our in-house Training Academy in San Antonio, which is designed to equip individuals with the specialised skills needed to maintain and repair aircraft engines.  In terms of retaining employees, we offer a highly competitive compensation package and a truly welcoming work environment, reflecting our commitment to members of ‘the StandardAero family,'” he tells us.

Tommy Hughes is very much in agreement with Lewis Prebble when it comes to a shortage of skilled MRO technicians. However, he also goes on to identify the effect of new technologies where the future is concerned, stating that: “…the industry faces a technical challenge as we adopt new technologies such as 3D manufacturing of replacement parts, AI, robotics and other advances that require new skills and training. Investment in the workforce will be a key for many MROs in 2025.” Still on the topic of an experienced workforce, Mike Cazaz brings up the problem of the ‘revolving door' where employment is concerned. He explains that “The lack of experienced workforce like engineers is a major challenge to the industry but also the “revolving door” condition that the industry has been experiencing for the last four years.  We are seeing experienced personnel moving from one company to another causing disruptions to MRO companies but also an inflationary condition in the employment market.  I don't see a major change in this area in 2025 as the indications are that this situation might take at least another two years to rectify.”

Rather than simply identifying the workforce problem, Scott Butler looks at a way of dealing with the shortage of skilled engineers and mechanics, advising that: “Creating a viable talent pipeline is nothing new in the MRO industry.  While increasing rates are helping the industry recruit, there is still a limited pool to choose from.  More and more MROs are building their own pipelines through educational partnerships and even creating their own certification programs to help bridge the talent gap.” On the same theme, Tom Eskola tells us that: “Panasonic Avionics also curates an apprenticeship programme for our Panasonic Technical Services team and offers a blend of classroom and hands-on training in aircraft maintenance.  The programme emphasises diversity, equity, and inclusion, inviting candidates from various backgrounds.  Apprentices can gain practical experience at Panasonic's maintenance facilities and work toward earning aircraft maintenance certifications.  The initiative aims to create a sustainable, diverse workforce and meet our future needs while supporting gender diversity in the field.”

Tulika Dayal draws our attention to a current skills gap, an aging workforce, and the challenges of attracting and retaining talented mechanics and engineers. As far as 2025 is concerned, she highlights the following: “Digital and Technical Skills: As digital technologies increasingly transform MRO operations, there is a critical need for technicians and engineers with expertise in digital skills, such as data analytics and automation. These competencies will drive innovation and efficiency in the rapidly evolving aviation sector,” before adding “Sustainability: The increasing emphasis on sustainability may lead to a demand for workers with expertise in sustainable practices.”

Prospects for independent MRO providers compared to in-house airline operations

The future of MRO in the aviation sector is poised to embrace a blend of in-house and outsourced services. Airlines are increasingly recognising the benefits of outsourcing specific maintenance tasks to specialised MRO providers while preserving their core competencies and essential functions internally. As SkySelect's Tulika Dayal puts it: “Independent MRO providers that consistently deliver innovative, high-quality, and cost-effective services will not only stand out in the market but also seize substantial growth opportunities in the years ahead.” On the other side of the coin, Lewis Prebble at StandardAero points out that: “The prospects for independent MRO providers remain as strong as ever, while in-house airline MRO shops naturally benefit from a captive market, independent MRO providers do not represent competition to any of our customers, thereby enabling us to market our services more widely.  For us, it is an advantage to be wholly dedicated to the engine repair market – we are focused on our core business, rather than at the whim of airline investment cycles.  We make long-term investments and have built strong enduring relationships with all the key OEMs across many different platforms.”

Over at VAS Aero Services, Tommy Hughes feels that there is room for both in-house MRO providers as well as in-house airline operations. As he explains: “There's no doubt that in-house maintenance capabilities offer large airline operators some economies of scale and quality control, especially those fleets flying just one or two platforms.  But smaller airlines, or those operators with international routes, may be better served by outsourcing their maintenance and repair to qualified, independent MRO providers who can provide a range of specialty services more cost effectively.” However, at Werner Aero Mike Cazaz sees things slightly differently, especially with regard to in-house MRO providers. “Airlines are still dealing with operational problems, and I don't see them increasing their MRO capacities beyond their own fleet.  Independent MROs are probably going to see additional consolidations in the market as more and more P.E. companies are coming into the market for new acquisitions and consolidations,” he advises.

At IBA Denis Brailsford feels that as airlines grow and evolve, traditionally the natural step would be to develop in-house MRO capabilities. In-house capabilities provide benefits such as reduced costs, reduced turnaround times and the possibility to sell the service. This, however, comes at a cost of investing in tooling, materials and a skilled workforce to support such an operation. As a result, many airlines tend to maintain line maintenance capabilities with limited base maintenance approvals. With major heavy checks and engine overhauls being outsourced, we do not consider there to be any major shift in this approach in the short term.” He points out that: “One major change we are seeing in the engine market is a shift with both CFM and PW limiting their PBH (power by the hour) offerings on the LEAP and GTF engines. This will drive further competition in the market as operators have more flexibility on the MRO they select.”

Tom Eskola at Panasonic Aviation feels that the prospects for independent MRO providers like PTS are robust, particularly as airlines increasingly outsource non-core operations to streamline costs and focus on their core business. Independent providers offer flexibility, scalability, and specialised expertise that in-house airline operations often cannot match without significant investment. He points out that: “Unlike traditional airline in-house operations, PTS has expanded its services beyond in-flight entertainment and connectivity maintenance to full aircraft line maintenance coverage. The range of services includes Transit Checks, ETOPS Checks, Daily Checks and Weekly Checks,” before adding: “The strategic advantage for independent MRO providers is in their ability to adapt quickly to airline demands while leveraging global networks of expertise and resources. For PTS, its established line maintenance infrastructure, coupled with the ability to expand rapidly, offers a compelling value proposition.”

What lessons has the industry learned from recent disruptions?

Aside from the confirmation of the inherent reliance of the MRO industry, three of the biggest lessons learned could well be the need to protect supply chains (as best the industry can, given the more powerful influence of the OEMs);  the need to ensure that the expertise and experience held by long-serving employees is sufficiently recognised and harnessed, for example through mentorships,  and the need to appreciate how quickly demand can bounce back following a major disruption. “In terms of shaping the industry, the key dynamics to strive for are flexibility, adaptability and scalability, in terms of being able to weather such disruptions and then efficiently return to full output,” says Lewis Prebble. Meanwhile, Tommy Hughes is more focused on the future than the present, commenting that: “Going forward, MRO providers are likely to invest in more diversified and robust supply chains. There is already a shift toward near-shoring or building more localised supply chains to reduce dependency on global suppliers. Stocking critical parts and materials and forming closer partnerships with suppliers will be important strategies to mitigate future disruptions. MROs may also focus on data-driven forecasting and predictive maintenance to better anticipate future needs and ensure the availability of those needed parts before they become critical.”

In terms of creating some form of resilience for the future against similar disruptions, Scott Butler puts it very succinctly, perhaps intimating that it is better to be proactive as opposed to reactive: “Never stop investing.  Short-term disruptions tend to cause knee-jerk reactions to shed investments into new capabilities and talent pipelines.  This causes real damage down the road with the inability to ramp up fast enough to meet demand.” Denis Brailsford is also equally concise in his assessment of the situation: “The industry is still coping with disruptions from both technical issues and the shortage of spares, especially in the engine MRO sector. The parts supply disruptions have shown the industry's reliance on ‘Just in Time' part supply to avoid expensive components sitting on the shelf.  Such a philosophy does not provide resilience when disruption to the supply chain occurs,” he comments.

The industry recognised that diversification of revenue streams is essential for business continuity.  Manufacturers have realised the stabilising role of aftermarket services, which proved less vulnerable to market fluctuations than new product sales.  Tom Eskola points out that PTS was able to manage its balance sheet and maintain contributions to the company's bottom line in times of lower demand, then was able to quickly resume business activity and buoy company revenue. He explains further: “As found within other industries, those with a foundation for digital transformation were poised for success through recent disruptions, and investing in predictive maintenance proved valuable in maintaining operational continuity.  With our global network of line maintenance and repair stations, our proven success in scalability and breadth helped our customer airlines to not only continue flying where and when they needed but to maintain their passenger experience despite extreme challenges.”

Tulika Dayal feels that the aviation industry has learned several valuable lessons to adapt to unexpected events like pandemics and geopolitical tensions swiftly. These lessons will help enhance its resilience in the future through four principal strategies: digital transformation, supply chain resilience, financial resilience and agile workforce management, for example “Airlines and MROs are adopting flexible staffing models to optimize labour costs and respond to varying workloads. Additionally, they have improved operational efficiency and reduced overhead costs by leveraging remote work and virtual collaboration tools,” she explains.

Where are we likely to see greatest MRO growth in 2025?

This is perhaps the US$64,000 question, though taking into account inflation, maybe that should now be the  US$6.4 million question! In answer, Tommy Hughes senses that MRO growth will be global, likely led by the Asia-Pacific region which is experiencing fleet expansion and rising demand for regional services. The Middle East should also see strong growth due to its strategic location and expanding airline hubs.  North America will continue to be a main driver of growth as both passenger and cargo traffic accelerate. He then adds that: “Thanks to a global growth strategy that we implemented several years ago, VAS is well positioned to benefit from increased MRO activity in all these regions, as well as Latin America and Europe where we anticipate more moderate but steady growth next year.” Mike Cazaz is of a similar opinion regarding Asia, stating that: “Probably Asia.  As this market is predicted to have the highest growth going forward.  We are already seeing some investments form OEMs in areas such as , Singapore and NZ.”

On the other hand, Scott Butler is looking closer to home with an optimistic air. “We are very bullish on the North & South American market.  Several operators are nearshoring their maintenance for operational control, and the increasing OEM deliveries are leading to large fleet change which will benefit secondary and tertiary markets as well as passenger-to-freighter conversions,” he tells us. While Tom Eskola sees an uptick in generated business, he does not feel there is a specific area PTS wants to specifically focus on, explaining that “PTS participates in a variety of trade shows, regulatory (Part145), and industry events in Asia, Europe, the Middle East and Americas regions. We have also recently started attending the IATP event to strengthen our relationships with airlines and review our service offering to ensure we maintain a competitive suite of services across IFE, cabin, connectivity, material management and ground handling programs. As airlines continue to add capacity and routes, we are there to support their growth and ensure the highest possible uptime and passenger experience possible. Airlines buy MRO services from companies that deliver the highest performance, and we have spent the last 20 years creating an organisation that delivers on that goal.”

Tulika Dayal provides a comprehensive overview of where she feels there will be the greatest MRO growth during 2025, pointing out that key factors driving that growth will include fleet expansions, aging fleets, technical advancements and government initiatives. In the Middle East she highlights the UAE and especially Dubai as having positioned itself as a potential aviation hub. China is also on her radar, as she says that: “As one of the fastest-growing economies in the world, China is experiencing a surge in air traffic demand alongside an expanding fleet.” India, Brazil and Africa are also on her list.

Denis Brailsford at IBA is another who feels that the Middle East will see good, continued growth, As he explains: “The growth in the MRO sector is going to continue in the Middle East, with new aircraft types entering such as the 787 with Riyadh Air and the with Emirates. It is common for state-backed operators to develop MRO capabilities especially as they attempt to diversify GDP away from oil production. Such initiatives such as the Saudi Public Investment Fund (PIF) Vison 2030 bring great opportunities for MRO growth in the region.

According to IBA Insight, the leading aviation intelligence platform, there is a large increase in potential lease ends in the Asia Pacific region, increasing MRO demand there.  While it is expected a number of leases will be extended because of the well-documented delays in new aircraft deliveries and new engine reliability, it is considered there will be increased demand for lease-end support in both aircraft maintenance and engine MROs. This increased demand has been predicted by the industry and major investment has been made in new facilities like Safran's new CFM LEAP overhaul facility in Hyderabad which is set to open in 2025.”

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