New Report Shows Aviation Maintenance with Positive Balance of Trade, Growth Prospects Over Next Decade

March 15, 2017
According to the 2017 Global Fleet & MRO Market Assessment, prepared by Oliver Wyman for ARSA, the U.S. civil aviation maintenance industry employs more than 277,000 people across the United States and generates $44.1 billion in annual economic activity

WASHINGTON – Aviation maintenance, an often overlooked but vital segment of the aviation industry, is not only a major employer nationwide making a substantial impact on the U.S. economy; it has achieved a positive balance of trade, a new report finds. 

According to the 2017 Global Fleet & MRO Market Assessment, prepared by consulting firm Oliver Wyman for the Aeronautical Repair Station Association (ARSA), the U.S. civil aviation maintenance industry employs more than 277,000 people across the United States and generates $44.1 billion in annual economic activity.

The report found there are more than 3,800 American firms across all 50 states performing maintenance services. Contrary to popular perceptions about the industry, most aviation maintenance work is done “off the aircraft” by highly specialized Federal Aviation Administration-certificated facilities working on engines and components. The vast majority of these repair stations, close to 85 percent, are small-to-medium sized businesses employing 50 or fewer people. Overall, thanks to strong performance in component and engine-specific services, the United States enjoys a positive balance of trade for maintenance: American maintenance exports exceed imports by almost $850 million.

The report was released March 15 at a Capitol Hill briefing conducted as a part of ARSA’s annual Legislative Day, an event that has become a highlight of the transportation policy community’s spring calendar. David Marcontell, Oliver Wyman vice president, presented this year’s report.

The total worldwide market for commercial aviation maintenance in 2017 is expected to reach nearly $75.6 billion, Oliver Wyman found. By 2027, global sales will expand to more than $109 billion, based on the firm’s projections.  Maintenance providers will see steady demand growth, as fleets expand and new technologies emerge, Marcontell noted during the briefing.

As a further enhancement to this year’s report, the 2017 assessment includes an economic sensitivity analysis that tests the $109 billion projection against four alternative economic scenarios. Ranging from “cloud nine” robust growth to “black swan” disaster, the maintenance market fares relatively well against each variation. In fact, in three of the four situations considered, the market actually outperforms Oliver Wyman’s baseline economic projection. Even when bearish assumptions are made for a “weakened economy,” airline dependence on legacy aircraft would still bolster maintenance, repair and overhaul spend to $111 billion by 2027.

“Basically everything would have to go economically haywire in the global market for maintenance spend to not at least meet projections,” Marcontell said about the analysis. “Even then, the numbers are still in the ballpark of $100 billion in 10 years’ time; in terms of dollars and cents, this is a very durable industry.” 

“The most important takeway from this report for members of Congress is that you may not know it, but the aviation maintenance industry plays an important part in your state’s economy,” ARSA Executive Vice President Christian A. Klein said. “So, whether you’re reauthorizing the FAA, refining the tax code, changing trade policy or overhauling the regulatory system, lawmakers need to consider the impact on repair stations and their employees.”

Highlighting the hundreds of thousands of American workers involved in avatiion maintenance, Klein concluded: “We say it a lot, but it bears repeating: We can’t fly without them.”

The report’s executive summary, as well as a fact sheet illustrating U.S. state-by-state employment figures, can be found in ARSA’s economic data center at arsa.org/news-media/economic-data.

For more information – including live updates – on ARSA’s 2017 Legislative Day & Annual Repair Symposium, visit arsa.org/symposium

ARSA is the only association devoted to the unique needs of the global civil aviation maintenance industry. It is dedicated to helping member companies operate more efficiently and effectively, while continuing to ensure the safety of aircraft worldwide. To learn more about the association’s work on behalf of both industry stakeholders and the flying public, please visit ARSA.org.