US-based MRO firms will have more opportunities to ramp up widebody modifications as labour rates in the Asia-Pacific region rise and slots become harder to come by as that region takes care of its own maintenance needs, says aviation consultancy Team SAI.
“What this presents is a significant opportunity for airframe MRO firms in North America to begin to take on some of that work as it’s repatriated,” says Dave Marcontell, president and chief operating officer of Team SAI during a 21 March conference call.
Asia-Pacific labour rates will start to approach parity with those in the USA in the 2020s, TeamSAI chief executive Chris Doan tells Flightglobal. However, North American MROs could see opportunities very soon to win back MRO work performed abroad as airlines re-negotiate maintenance contracts and fuel prices increase ferry costs, he says.
“We actually think we’ll start seeing some repatriation in the next year certainly, as decisions are made and as contracts come up,” he says.
North American operators are sending as much as 60% of widebody heavy maintenance to China and the Asia-Pacific region, shows an analysis Team SAI performed on behalf of the Alexandria, Virginia-based Aeronautical Repair Station Association.
While these airlines are spending about $2.4 billion on airframe maintenance, about $568 million of this demand is satisfied by maintenance providers outside of North America, says Team SAI. North American MROs produce about $66 million of MRO services for airlines outside of the region, making the region a net importer of airframe maintenance.
Several North American maintenance firms have recently announced new hangar openings. In May, new hangars from Airborne Maintenance and Engineering Services (AMES) and Aviation Technical Services (ATS) will open, creating both new narrowbody and widebody capacity. AAR has also recently added capacity at its Lake Charles, Louisiana facility that fits aircraft as large as an Airbus A330 or Boeing 787-8. The facility received FAA and EASA approvals in the past several months.