Turbulence Ahead: Labor Shortage and Material Costs Threaten MRO Industry’s Growth

Feature by Aeroclass

Ever since the start of the pandemic, the MRO (Maintenance, Repair, and Overhaul) industry has faced many challenges that had an impact on many industry players. According to Anca Gosling, Director of Training Content and Development at Aeroclass, an aviation digital learning platform, despite hurdles, the industry is expected to reach new heights in the coming years.

The current state of the MRO market indicates a remarkable recovery, with a projected market value of $94 billion in 2023, an increase of over 20% from the previous year. This growth signifies a return to pre-pandemic levels, as the global fleet has recovered by 98%, and passenger traffic has reached 90% by the beginning of 2023. However, Gosling points out that amidst this positive outlook, the industry further continues to face challenges that impede its rapid development.

One of these challenges is effective labour and material cost management as material costs are expected to experience inflation of approximately 6.7% annually over the next couple of years. Gosling explains that to counteract this, MROs are focusing on increasing the usage of used serviceable material (USM). With retiring current-generation fleets, there is ample opportunity to salvage materials, while the commonality between current and next-generation fleets facilitates USM adoption.

Shortage of qualified staff

Another significant challenge lies in the shortage of qualified staff, particularly maintenance technicians. Anca Gosling explains, “As demand for MRO services rebounds, the industry has had to rapidly scale up production and maintenance operations with fewer employees. To address this issue, operators are implementing measures such as educational outreach, subsidized technical training, improving the work environment, recruiting talent from other industries, and utilising internet-based recruitment platforms Online training and courses, such as the ones offered by Aeroclass, can also play a vital role in optimizing staff training and onboarding processes, enabling faster and more streamlined training programs.”

Additionally, the MRO industry faces challenges in its material supply chain. Original Equipment Manufacturers (OEMs) and suppliers have struggled to meet the increased demand for parts, leading companies to rely heavily on the aftermarket for supplies. “This strain on the supply chain highlights the need for improved collaboration and coordination between OEMs, suppliers, and MROs to ensure efficient and timely availability of required materials,” she shares.

Address challenges amicably

While the MRO industry is poised for recovery and growth, several challenges must be addressed to ensure its sustained success. Effective labour and material cost management, tackling the shortage of qualified staff, and overcoming material supply chain disruptions are all critical areas that require attention. By implementing strategic solutions such as increased usage of USM, investing in training programs and online education, and collaborating closely with suppliers, the MRO industry can navigate these challenges and continue its upward trajectory, driving innovation and efficiency in the aviation sector.

(Aeroclass is the first digital learning platform to focus specifically on the aviation market.Aeroclass is part of the Avia Solutions Group family, the world’s largest ACMI (Aircraft, Crew, Maintenance, and Insurance) provider, with a fleet of 180 aircraft, and a parent company of SmartLynx, Avion Express, Bluebird Nordic, BBN Indonesia Airlines, KlasJet, Magma Aviation and more.)

FOREWORD

Dear Readers,

The Asia-Pacific aviation sector is expanding rapidly, driving growth far beyond aircraft numbers into crucial verticals like MRO, training, logistics, and aerospace supply chains. In this edition of Aviation World, we bring you exclusive interviews and features from across these sectors, offering direct industry insights from top global leadership.

Our cover story highlights Shveta Gupta, CEO of Divyanshi Aviation. Under her dynamic leadership, the company has established itself as one of India’s premier aerospace supply chain providers, partnering with leading global manufacturers. Our corporate feature delves into Divyanshi Aviation’s core operations, paired with an exclusive interview where Ms. Gupta candidly shares her professional journey and vision for the company’s future.

This issue also features exclusive conversations with prominent industry leaders, including:

  • Ron Nye, President of Avionics, Acron Aviation
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  • Sudhir S. Rajeshirke, President – Aerospace, Jubilant Enpro
  • Emmanuel Simon, Program Manager and Aerospace Leader, PHINIA
  • Arved von zur Muehlen, Chief Commercial Officer, Saudia Group
  • Simon Azar, Vice President, Civil Aviation, Asia Pacific, CAE

Each leader offers key perspectives on their organization’s strategic initiatives and their growing contributions to the Indian aviation and aerospace ecosystem. Additionally, you will find expert-authored analytical features offering deep dives into current sector trends.

Aviation World continues to expand its global footprint as an official media partner for major domestic and international aviation events. Our editorial team will be participating in several upcoming global forums, and we look forward to connecting with industry peers and exploring new collaborations.

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Happy Reading!

The Editorial Team

Aviation World

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