Aviation MRO aftermarket faces specific challenges in Middle East

13 February 2019 Consultancy-me.com

Aviation sector executives have gathered in Dubai to discuss the local MRO market, with a number of challenges specific to the Middle East region.    

Organised by industry publisher and event producer Aviation Week Network, the MRO Middle East conference has wrapped up for 2019. Prior to the event, senior members of Roland Berger’s Aerospace & Defense practice spoke to MRO-Network.com on some of the aviation maintenance and repair issues specific to the Middle East market, such as the hot and sandy local environment.

Held at the Dubai World Trade Centre from the 10th to the 12th, the 2019 MRO Middle East conference and exhibition brought together more than 150 senior professionals from the aviation aftermarket for discussions around topics such as innovation in MRO (maintenance, repair and overhaul), optimisation and cost reduction strategies, and big data, prognostics and predictive maintenance.

Among the speakers for the event were Robbie Bourke, Vice President of Oliver Wyman aviation subsidiary CAVOK, providing a regional industry overview and forecast, and Roland Berger partner Richard Paton, who moderated a panel on the local threats, trends and aftermarket growth opportunities in the Middle East – featuring among others senior leaders from Etihad Airways Engineering and Jordan Aviation Airlines.Challenges remain in Middle East aircraft maintenance segmentPrior to the conference, Paton – who was recruited as a partner last year to Roland Berger's Bahrain office – spoke to Aviation Week Network-affiliated industry media site MRO-Network.com on the local market challenges, alongside UK-based Roland Berger managing partner Robert Thompson. One of the most challenging issues: the hot and sandy Middle Eastern environment.

Naturally, such conditions are not ideal for aircraft, and especially their engines. But delving deeper, Thompson further note the rapidly expanding fleets in the region – with recent departure growth estimated at around 6.5 percent – but an ageing profile, as the moderation of oil prices and economic slowdown have delayed retirements of older aircraft and curbed the number of new deliveries.

Yet local MRO operators – serving an industry which is forecast to grow by 4 percent globally over the next decade to $115 billion – are lacking price competitiveness due primarily lack of home-grown workforce and thus higher labour costs, with international outsourcing the result. Still; “For engine and component services, where labor is a smaller portion of total costs, Middle East providers can be competitive,” says Thompson.

Particularly, he adds, if they develop their capabilities by investing in facilities such as test beds for engines. Here, there has already been some movement, with new MRO facilities in the UAE and in Jeddah – the latter said to the largest in the world – to provide a more competitive landscape. But, more investment will be needed, concludes Paton, to ensure a stream of qualified local mechanics.


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