Aviation and Defence Experts Reveal Road to Recovery for Global Maintenance, Repair and Overhaul Sector
- Industry specialists highlighted the impact of COVID-19 on MRO during webinar
- The event revealed a need for industry leaders to create more efficient, digitally-led and prioritised workflows to ensure a speedier recovery for the sector
- Webinar hosted by organisers of the Global Aerospace Summit 2020
11 August, 2020 – Abu Dhabi, United Arab Emirates: Experts from commercial aviation and defence industries highlighted the impact of the COVID-19 pandemic on the Maintenance, Repair and Overhaul (MRO) sector. During a webinar - hosted by organisers of the Global Aerospace Summit 2020 – the aviation specialists revealed key elements needed for the recovery of the MRO sector both within the Middle East and internationally.
Rahul Shah, Senior Vice President Strategic Roles & Business Development, AAR Corporation, moderated the virtual panel and described the devastating impact that the COVID-19 pandemic has had on MRO and the aviation sector in general. He highlighted that there is currently a projection that there will be an almost 50% drop in MRO to a value of 42 billion USD. Shah added that he does not expect the value of the MRO market to return to 2019 levels until 2022 or 2023.
“There has been a significant drop in MRO spend and it is often the first part of the budget to be cancelled and the last to return. An L shaped recovery of the industry is most likely and it will take 18 to 24 months before air travel returns to some normality,” commented Shah.
Frederic Dupont, Vice President Technical Sales & Customer Service, Etihad Airways Engineering spoke about how his organization is working hard to make the most of the opportunities available during the slowdown in this pandemic.
He commented: “Our focus has been to increase ancillary revenue streams and diversify the portfolio. We are working to ensure that we have the necessary capabilities and fine-tune our service value across the different platforms available to us. Ensuring efficiencies during this time is critical, as is managing costs and maintaining productivity. We have focused on uplifting cabins to deal with the impact of COVID-19. In terms of maintenance, we are taking a phased approach to optimise the costs and ensure that we prioritise the essential work.”
Dupont also added that digital solutions are widely being used across the organization as COVID-19 has changed the way businesses operate. He expects this trend to continue.
Ziad Al Hazmi, Chief Executive Officer, Lufthansa Technik Middle East revealed that his company and and airlines they work with are looking at short term solutions. He added that he expects a challenge because of a surge in MRO requirements and that his organization is focused on using that as an opportunity to ensure there are no capacity issues.
“We are working on the financials with our customers to get through this difficult period. The most important focus for us has been on managing cash. Airlines need to have transparency on where parts are installed and whether repairs are needed or not so that we can manage fleets in a smart and cost-effective way,” added Al Hazmi.
Mark Krusemark, Aviation Industry Strategic Advisor, GAL explained that the defence sector has actually had less of an impact from COVID-19 when compared to commercial.
“The military side of the market has expectedly been more stable than its commercial counterpart, though this too is subject to rapidly developing circumstances. To maintain military readiness, what is key right now is to prevent maintenance backlogs from developing, given the long recovery time associated with such backlogs. The UAE’s extensive investment into technological capabilities has empowered the military in different ways, and so where still needed the focus should remain on areas that require manpower,” said Krusemark.
The webinar was held as part of a series of virtual events focused on a range of topics, which will form part of the virtual programme for the Global Aerospace Summit 2020 on 28th & 29th September. The international thought leadership forum will be hosted by Mubadala Investment Company and EDGE and is being organised by Streamline Marketing Group and Tarsus F&E. More details on the Summit will follow over the coming weeks.
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