Will Sanctions Push MRO Work Out of Russia?
With Russia now a global pariah following its invasion of Ukraine, supplies of Western-built aircraft, engines and spare parts face significant sanctions.
Speaking yesterday (Feb. 24), European Commission president Ursula von der Leyen said the EU would “ban the sale of all aircrafts, spare parts and equipment to Russian airlines.”
“This will degrade the key sector of Russia's economy and the country's connectivity,” she continued. “Three quarters of Russia's current commercial air fleet were built in the European Union, the U.S. and Canada. And, therefore, they are massively depending on that.”
Furthermore, U.S. and European lessors may be asked to cut their ties with Russian carriers, as EU-based lessors were with Belavia after Belarus stoked border tensions with Poland by flying in refugees last year.
There are almost 500 aircraft leased by Russian carriers from foreign lessors, so obviously such a move would cause chaos within the country’s civil aviation operations.
For now, there appears to be no easy way for lessors to repossess their aircraft, though that may change once the Ukraine crisis abates and if punitive sanctions are maintained.
This might mean a huge wave of reconfiguration work if Russia’s leased aircraft are repossessed en masse and then transferred to new operators, although a likelier scenario is that many would go into storage while new customers were sought.
Even so, there is potential for a transfer of significant maintenance volumes from Russia to the rest of the world over the next few years if sanctions endure, and if Russia cannot arrange an alternative supply route through China.
Aviation Week’s Fleet & MRO Forecast estimates that Russia’s MRO market for Western airframes and engines is worth $2.3 billion in 2022.
A hefty chunk of that may be up for grabs over the next few years.