The Commercial Aviation Market is finally seeing a positive shift as passenger traffic and fleet utilization has surpassed the pre-COVID levels of 2019. After years of turbulence and market carnage, airlines’ profitability is expected to enter the positive zone in 2023. The passenger flights offered by airlines are predicted to exceed pre-pandemic levels for the first time in 2024, as per IATA. This is due to the rising passenger traffic levels that are likely to improve fleet utilization and boost passenger revenues and RPKs.
However, despite these positive trends, airline profitability remains abysmal, with rock-bottom numbers of just $23+ billion for 2023, a mere 2+% net margin, and $5+ per passenger in revenues. These figures are far below the cost of capital and are projected to remain marginally better for 2024, albeit with a relatively lower cost base.
The increase in passenger traffic, combined with supply chain issues, is expected to lead to better fleet and capacity utilization, resulting in increased yield and profitability. This will also boost demand for maintenance, repair, and overhaul (MRO) services, leading to substantial growth in projected MRO revenues for the industry in the near to medium term.
However, the high crude oil prices are a concern for airlines in terms of profitability. They are also investing in measures to reduce their overall carbon emissions in a tight cost of capital market environment, with interest rates remaining high.
The industry is making efforts to increase production rates across the entire value chain, led by Airbus and Boeing. Despite ongoing supply chain issues and supplier delinquencies, they have registered a marginal increase in commercial aircraft deliveries for 2023. Additionally, engine and other Tier 1 suppliers have steadily ramped up production.
The global economy is expected to slow down in 2024 due to the monetary policy tightening posture adopted by central banks worldwide to check inflation. This trend has been worsened by ongoing geopolitical instability, such as the Russia-Ukraine war, now in its third year, and Israeli military operations in Gaza, which have caused tensions and kept the entire Middle East region on edge. This double whammy has resulted in global economic growth returning to its average range of under 3% annually. However, any major potential shock at this time could send the global economy spiraling down into a recessionary cycle.
In this context, the report provides comprehensive insights and analysis into the Global Commercial Aviation MRO Services Market. The first part of the report provides an overview of the current market size and dynamics for the Global Commercial Aviation MRO Services Market. The second part offers a detailed analysis of the Aviation MRO Services Providers, including insights into key strategies and plans and a comprehensive SWOT analysis. The third part projects market evolution for the Commercial Aviation MRO Market over the medium term (through 2033) with analysis of emerging market scenarios, demand growth forecast and projections, key market and technology trends, issues and challenges, potential growth opportunities, and market outlook for commercial aviation MRO Services market over the decade through 2033.
