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Could AAR’s purchase of Triumph Group’s Product Support business be a harbinger for the MRO industry? The deal, which closed on March 1 for $725 million—AAR’s largest acquisition—is not about industry consolidation.
The acquisition addresses the two biggest broad problems facing the MRO industry right now: supply chain pain and workforce shortages. Plus, it should help AAR’s quest to improve operating margins, which it has done every quarter for the past three years.
On the supply chain side, the deal includes repairs for about 10,000 part numbers in 30 Air Transport Association (ATA) chapters—spanning structural components and airframe and engine accessories. The structures part, including nacelles, is a new capability for AAR.
Having this expanded in-house repair capability could decrease airframe heavy maintenance turnaround times because the work does not need to be outsourced. With a tight parts market for new and used material, vertically integrating the repairs and heavy maintenance business should benefit each other because “anything we can do to bring more control over the process is a positive,” John Holmes, AAR’s president and CEO, tells Inside MRO.
AAR also welcomed 700 Triumph employees, including designated engineering representatives, who have experience servicing commercial, regional and military customers. Gaining that many experienced people, especially in today’s market, is extremely valuable.
AAR also gains five facilities—four in the U.S. and one in Thailand. Expect the company to leverage the Thai facility to expand its Asian business.
Speaking of additional facilities, in addition to component repair bottlenecks, try to find airframe heavy maintenance slots. While the shortage has pushed airlines to book hangar space further in advance, which helps MROs’ maintenance planning, there is only so much space.
However, between March 27 and 29, three MROs in the U.S. made hangar announcements. On March 27, AAR broke ground on a 114,000-ft.2 hangar that will accommodate three narrowbody aircraft. The new hangar will be adjacent to its existing facility at Miami International Airport and is scheduled to be operational in October 2025.
On the same day, FEAM Aero opened a 150,000-ft.2 hangar at Cincinnati/Northern Kentucky International Airport. The $45 million hangar can simultaneously house three widebodies.
Two days later, on March 29, Ascent Aviation Services broke ground on two widebody hangars at its facility in Marana, Arizona. The MRO plans to fast-track them for a targeted completion by year-end to accommodate the Boeing 777-300ER passenger-to-freighter modifications it is doing for Israel Aerospace Industries.
While all three of these companies have robust workforce development programs to fuel their expansions, I urge you to read Lindsay Bjerregaard’s “Workforce Hurdles” article. She has written a lot about the MRO workforce shortage, but here she points out the critical shortage of designated maintenance examiners. Without them, airframe and powerplant students are not going to take the FAA test at a higher rate, and that rate is not high to begin with.
