THE WAY FORWARD FOR AEROSPACE MRO

THE GLOBAL AIRCRAFT MRO MARKET WAS EVALUATED AT USD 87.01 BILLION IN 2021 AND IS EXPECTED TO EXPAND AT A CAGR OF 4.57% FROM 2022 TO 2030. FOR MRO OPERATORS, RIGHT-SOURCING AND OUTSOURCING ARE TWO OPTIONS THAT ARE MORE RELEVANT TO MRO SERVICE PROVIDERS

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THE AEROSPACE INDUSTRY HEAVILY RELIES ON Maintenance, Repair, and Overhaul (MRO) to ensure aircraft safety, reliability, and availability. The demand for MRO services has been on the rise due to an increase in air travel and aging aircraft. India's aviation industry is set to become the third-largest buyer of commercial planes after the US and China, with a fleet size of over 713 aircraft and plans to add more in the near future. As a result, the Indian aerospace industry is one of the fastest-growing markets worldwide. The Indian MRO industry is still in its early stages, with a current size of USD 1.7 billion as of 2021, but is expected to reach USD 4.0 billion by 2031. Rising consumer demand, favourable policies, and labour arbitrage are some of the factors that could fuel the industry's growth. Additionally, redelivery maintenance contracts can help drive desired capacity expansion.

However, the Indian MRO industry faces challenges breaking into existing value chains involving OEMs, globally established MROs, and airline operators. Other obstacles include implementing offset clauses, accessing credit, infrastructure availability, licensing and certification, taxes/duties, and land lease rentals. The government has initiated various reforms to develop India as a global MRO hub. Incremental steps such as joint ventures focus on lower IP control MRO segments and a gradual shift towards higher-end value chains are recommended.