MRO Aviation Business Models 101
An aviation industry buzzword that has been garnering more attention in recent years is that of "MRO." But what is MRO and how does it fit within your business? It's actually quite simple.
MRO stands for maintenance, repair and overhaul. Aviation MRO refers to the specific repair, service or inspection of an aircraft. The practice encompasses that of all maintenance activities done to ensure the safety and airworthiness of an air transport vehicle.
Keep reading for a high-level look at MRO business models and learn which aircraft towing equipment and GSE you'll need for a successful MRO aircraft management facility.
What is an MRO Aviation Facility?
In 2017, the International Air Transport Association (IATA) reported that worldwide annual air passenger numbers exceeded four billion for the first time. This was due to improved global economic conditions, lower average airfares and more connected cities than ever before. And in 2019, IATA forecasted that the average world citizen would travel once every 21 months. As the value of the aviation market steadily climbs, supporting operations and aircraft MRO facilities will be in more demand than ever before.
An MRO facility is any location, workshop or hangar that engages in and conducts aircraft maintenance professionally. MRO facilities and technicians help to keep airplanes running safely and reliably through the use of aircraft ground support equipment. But it's important to remember that, while the term "MRO facility" covers a broad swath of the industry, the specific business models vary greatly.
MRO Aviation Business Model Types
Depending on the business type, aviation MROs can be vastly different. The following are the six most common MRO aircraft maintenance business models and facility types that can be found around the world. We take a more in-depth look at each of these in part two of our two-part series on MRO titled Aviation MRO Business Model Categories.
Independent Repair Stations
Independently owned repair stations are typically small and operated by a handful of employees, but some can also be owned by large corporations. These smaller MRO stations usually specialize in one or two areas of expertise, like aircraft interiors or landing gear.
While there isn't as much potential for growth with these repair stations, they do maintain their niche. Larger market players aren't always interested in getting into the more specialized MRO services as the ROI on the equipment and staff simply isn't there. So, many will utilize independent repair stations for specialized services.
Fixed-Base Operators
A fixed-base operator (FBO) is usually located at large, non-commercial airports. The majority of FBOs support the local aviation community. Some offer full-service repairs for any aircraft on-station. If necessary, aircraft will go off-station for additional support or technical assistance.
Commercial Airline Hubs
Major commercial airlines maintain the biggest market share of mechanics and technicians in the civilian MRO market. Because commercial airline MROs exist solely to support the airline's fleet, there typically isn't a specific business model in place.
Commercial airline MRO facilities are usually located at the airline's major hub. As these MROs are owned and operated by the airline, they provide all levels of services and repair. As a general rule, most major airline MRO facilities don't subcontract work for competing airlines, but there are sometimes exceptions. MRO services should coincide with hub locations when possible to maximize efficiency.
Regional Airline Facilities
Regional airlines usually operate out of smaller, regional airports rather than major hubs. The regional airline-owned MRO facilities are instead scattered across an entire operating area.
In terms of repair and inspection costs, there is not much of a difference between major airlines and regional airlines. But with the latter, you'll find slightly higher profit margins, tighter infrastructure budgets and smaller fleets. Because of this, regional carriers have gotten creative to keep costs low. Many will break up repairs, dividing them between in-house technicians and subcontractors.
Military Facilities
As one of the world's largest purveyors of MROs, aerospace ground equipment and military towing equipment, military MRO facilities service a wide variety of aircraft. Military MRO aviation facilities are usually quite massive and utilize a large amount of MRO assets in order to properly and efficiently repair and inspect everything from cargo planes to helicopters.
In-House Corporate Facilities
Large corporations that own and operate their own fleet of corporate jets typically have an in-house MRO facility that is fully staffed with mechanics and operations support. This means staff is on-hand 24/7 to conduct aircraft maintenance.
Maintenance, Repair And Overhaul GSE
To make sure you have the infrastructure to conduct proper MRO, it's crucial that your facility has the right ground support equipment and technology in place. The following are just a few of the many items you'll need to carry out regular aircraft maintenance, repairs and overhauls. Keep in mind that this checklist is not exhaustive and may vary based on your business model.
Equip Your MRO Facility the Right Way with the Help of Tronair
Tronair offers an unparalleled selection of high-quality ground support and aircraft servicing equipment ideal for MRO services. With over 100 years of industry knowledge and experience, we're here to help you find the MRO aviation equipment you need and can rely on. If you want to know more about how our products can help you, contact us today.
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