From the early 2000s, U.S. and European airlines significantly increased the number of heavy checks on their widebody aircraft at MRO providers in Asia and other low-wage regions.
But toward the end of the last decade, that trend began to slow as labor rate differentials narrowed between West and East, fast-growing Asian carriers ramped up competition for local maintenance slots and airlines began to consider the sustainability impact of long ferry flights.
Then the pandemic hit, destroying demand for widebody operations and maintenance around the world.
Western carriers were much quicker to recover, though, with U.S. and European international capacity almost back to pre-pandemic levels last year, while Asian carriers were still 29% below their available seat kilometers in 2019.
This may have opened the window for Western airlines to book heavy check slots in Asia again. In the past year, Air Canada and Finnair announced contracts with Hong Kong-based HAECO.
“Our Asian partner has succeeded well in overall performance and is well located within our flight network, which also increases overall efficiency,” says a spokesperson for Finnair, which first selected HAECO for base maintenance in 2008 and last year extended a contract for Airbus A330 and A350 checks out to 2026. “Generally speaking, the labor cost difference between Asia and Europe has been reduced, and the decision is made based on overall performance evaluation,” the spokesperson adds.
It seems inevitable, though, that competition for slots will intensify as the lag in Asia’s recovery runs out.
Data from Aviation Week Network’s 2024 Commercial Fleet & MRO Forecast bears this out: it predicts that Asia’s widebody fleet will rise to 2,500 aircraft by 2030 from 1,700 aircraft in 2015, but predicts much slower increases for the U.S. and Europe, which will have about 1,400 and 1,500 widebody aircraft by 2030, respectively.
For a detailed look at the factors influencing where airlines perform their maintenance, see the next issue of Inside MRO.
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