Big money to be made in MRO...

Implications: MRO is big business today. With air travel demand set to double by 2020, keeping planes in the air is a lucrative and fast-expanding place to be. So if you have the money...

Analysis: Goodrich's selling its Everett, Wa., Boeing-linked heavy maintenance base Goodrich Aviation Technical Services could be misinterpreted as disaffection with the sector. The opposite is the case.

Maintenance, Repair & Overhaul (MRO) is a highly skilled, high-value-added link in the air transport chain. Such is the global shortage of good quality 3rd-party MRO shops (ie independent ones not linked to an 'in-house' airline) that certain European flag-carriers have for years flown empty B747s the 6,000 or so miles to Hong Kong for heavy (FAA-mandated) D checks.

It's big business. This is what the Singapore Minister for Transport Raymond Lim had to say about it at the opening of Singapore Airlines' two new MRO hangars in December 2006:

"The global aerospace industry has performed strongly in the past few years... Last year, Asia led all regions worldwide with a 7.6 per cent increase in international passenger traffic and 3.2 per cent increase in cargo traffic.". And Singapore has only about 6% global and 25% Asian regional MRO market share -- it's big, big business.

So the fact that Australia's Macquarie will be the new owner of a U.S. heavy maintenance shop, assuming no CFIUS regulatory problems, underlines again the global reach of the MRO business and gives further credence to the industry rationales behind Dubai's aerospace and MRO moves since 2005 in buying into the U.S. market.

MRO is a heavily regulated, labor-intensive service industry. As the international airline industry grows on the back of increased travel demand (even the more obtuse, politically-motivated routes --Venezuela's state airline Conviasa launched weekly flights to Iran via Syria on Sunday...), there are MRO opportunities galore. Germany's Lufthansa Technik, the market leader, has B747 full-service (ie up to D check) MRO operations at about 38 locations worldwide, from Seattle to Auckland and Rio de Janeiro to Tokyo).

And that's for an airplane that's currently out of production...