Nigeria takes back seat as MRO logistics market size to hit $13.1 billion by 2027

The global aviation Maintenance Repair Overhaul (MRO) logistic market size is estimated to reach $13.1 billion by 2027.

Aviation Maintenance, Repair, Overhaul, and Logistics (Aviation MRO Logistics) form an important part of the MRO industry, representing those companies engaged in the MRO of aircraft and related systems and components.

The presence of MRO logistics is imperative all through the lifecycle of an aircraft, right from its introduction into service to its final disposal. The main activities of the MRO logistics sector include maintenance, repair or replacement, overhaul, and logistics.

Aircraft undergoing maintenance repairs

The maintenance work includes the routine process of keeping the aircraft in airworthy condition. The repair and replacement activities require MRO logistics to continue repairing or replacing the damaged parts or components.

The lack of functional aircraft maintenance facilities otherwise known as Maintenance Repair Overhaul (MRO) cost Nigeria $2.5 bil­lion (about N1.25 trillion) in 2021 in MRO investments in neighboring countries like Ethiopia, Morocco, Egypt, United Arab Emirates, South Africa, and other nations with advanced maintenance facilities according to the Managing Director of the Federal Airports Authority of Nigeria (FAAN), Capt. Rabiu Yadudu in a recent statement. It is not known yet how much the country spent on overseas aircraft repairs in 2022.

READ ALSO:  Olateru, AIB CEO, elected Fellow, Royal Aeronautical Society

Having such investments here in Nigeria according to the FAAN boss would have created more employment opportu­nities for Nigerians, revenue generation, and training of technical personnel for the main­tenance of aircraft.

About five years ago it was projected that Nigerian airlines spend about $2 billion overseas on aircraft maintenance. But with an increased fleet that amount has risen to a projected $3 billion in 2022. Experts consider this a huge capital flight from Nigeria.

The instability of the naira in relation to its value against other major currencies has been a protracted problem that is getting worse as the nation’s economy plummets. Not having major Maintenance, Repair, and Overhaul (MRO) facility in Nigeria has forced the airlines to be at the mercy of such facilities in other parts of the world.

READ ALSO:  Professionals seek N30b stimulus for tourism sector

Conducting maintenance overseas has three major disadvantages: one it is relatively costly due to forex, two, it causes delays and three, it gives rise to logistics challenges. Sourcing foreign exchange has become extremely difficult for airlines.

Although, the Nigerian Civil Aviation Authority (NCAA) had licensed a few firms like Aero Contractors and 7Star Hangar to carry out aircraft maintenance jobs but does not have the capacity to handle more than three or four aircraft in a year.

As such, many airline operators ferry their airplanes overseas at huge costs because of the inability to wait for slots and the under-capacity of the maintenance for wide-body aircraft repairs.

Much of the continent’s MRO business estimated at $3.2 billion was leaving the region. The 2019 air transport MRO market was ~$87B; Africa represents~four percent ($3.2B); the Asia Pacific 33 percent; North America 23 percent; Europe 25 percent ($22B); the Middle East nine percent; Latin America six percent.

An airline operator who spoke to Aviation Metric on condition of anonymity said, “Every year so much money is expended by airlines as capital flight as aircraft is taken overseas for maintenance. Nigeria as of today has Aero Contractors and a few small maintenance facilities as the only place to maintain commercial aircraft, the Boeing classics. The facility there is even inadequate”.

READ ALSO:  Deportation: Air Peace passengers didn’t fulfil entry conditions, says Saudi Arabia

The Aviation MRO Logistics Market Research Report 2022-2027 provides an in-depth overview and insights on market size, revenue, various segments, and drivers of development, along with constraining factors and regional industry presence.

7Star Global Hangar MRO facility

The purpose of the market report is to thoroughly assess the Software and Services sector and get an overview of the Aviation MRO Logistics industry and its commercial opportunities.

As a result of the war between Russia and Ukraine and COVID-19, the global economy will recover and generate more sales by 2030.

Wole Shadare