Gulf airlines to fuel demand for MRO service

The demand for aircraft maintenance, repair and overhaul (MRO) service is set to grow significantly in the Middle East region in the coming years, led mainly by the ambitious fleet expansion by major airlines of the Gulf region, a senior official of Lufthansa Technik, one of the world's largest MRO service providers has said.

“There is certainly a need for MRO market in the region given the fleet expansion by major airlines of the region like Emirates, Etihad, Qatar Airways, Saudi Arabian airlines, etc. There is a need for MRO service even for smaller players, which will not be covered only by sending aircraft material, etc out of the region, but quite a considerable volume will be done in the region itself. That requires facilities, trained personnel and expertise. On a long term, Middle East will increase its MRO capabilities and capacities, which offers us an opportunity for partnerships,” Walter Heerdt, Senior Vice President - worldwide (Marketing & Sales) of Lufthansa Technik, part of the Deutsche Lufthansa group, told Emirates 24l7.

He said as per estimates the size of the Middle East MRO market, the second fastest growing MRO market in the world after Asia-Pacific, is approximately $1.8 billion in terms of the value of the contract, out of which Lufthansa Technik’s share is around 13 per cent.

“We’re expecting around 8 per cent growth of the MRO market annually in the region and this is expected to continue until 2020,” Heerdt said.

On February 2, at the MRO Middle East in Dubai, Lufthansa Technik signed a base maintenance contract with Oman Air, the national airline of the Sultanate of Oman, for Oman Air’s fifteen Boeing 737 NG aircraft.

Prior to that on February 1, Emirates Airline contracted Lufthansa Technik to overhaul the centre landing gears of its Airbus A340-300 fleet. The agreement has been signed for two years and includes services for eight aircraft.

He said in terms of the size, Emirates airline remains the fastest growing customer for the firm in the region.

“If you look at the number of aircraft that Emirates has in its fleet and the number of aircraft on their order books, Emirates is the fastest growing customer for us,” Heerdt added.

Last year, Middle East-based carriers reported the strongest full year growth in passenger demand globally at 17.8 per cent on the back of a 13.2 per cent capacity increase fueled largely by aircraft deliveries to Gulf-based airlines, according to the full-year 2010 demand statistics for international scheduled air traffic released by International Air Transport Association (Iata) released on February 2.

Load factors for the region also showed a 3 percentage point increase to 76 per cent. December demand was 14.1 per cent above previous year levels and 35 per cent higher than in December 2008, illustrating the structural shift that is taking place in the industry as a result of the region’s expansion, Iata said in a statement.

In the international freight demand as well, Middle East-based carriers (accounting for 11 per cent of the international freight market) recorded the second highest full-year growth rate of 26.7 per cent, behind Latin American carriers, the Iata said.

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