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World Commercial Aircraft Modernisation,
Repair and Overhaul (MRO) Market 2013-2023
4.5 Evaluating the HMV/Mods MRO Submarket 2013-2023



2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2013-23
Sales $bn 8.5 8.8 9.0 9.2 9.5 9.6 9.9 10.2 10.6 10.9 11.3 107.6
AGR (%) 2.5 3.7 2.6 2.0 2.7 1.6 3.0 2.5 3.8 3.2 3.9
2018-23 3.3
2.9
2.5 CAGR (%) 2013-18
CAGR (%) 2013-23








2013 2018 2023







0%
1%
2%
3%
4%
5%
0
2
4
6
8
10
12
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Mkt Value ($bn) AGR (%)
Year
S
a
l
e
s

$
b
n

A
G
R


17.3
%
16.2
%
15.3
%
Source: Visiongain 2013
Table 4.5 HMV/Mods MRO Submarket Forecast 2013-2023 ($bn, AGR %, CAGR%,
Cumulative)

Source: Visiongain 2013
Figure 4.12 HMV/Mods MRO Submarket Share Forecast 2013, 2018 and 2023 (%
Share)

Source: Visiongain 2013
Figure 4.11 HMV/Mods MRO Submarket Forecast 2013-2023 ($bn, AGR%)
Page 67

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World Commercial Aircraft Modernisation,
Repair and Overhaul (MRO) Market 2013-2023
5.5.3 The Next Few Years will be Crucial for AFI-KLM
Although AFI-KLM is one of the largest providers of MRO service activities to have operations
there, the company has not escaped the effects of the economic downturn on its business. With
fuel prices continuing to eat into its profitability margin, the company has resorted to a programme
of restructuring in order to return to sustainable profitability. The three year transformation plan will
see a slight reduction in the active fleet belonging to Air France whilst the company plans to
maintain existing flight capacity. It also plans to increase its share in the engine MRO submarket by
improving its economic efficiency, increasing its revenue generated from third party airlines and
restructuring hangar space. Whilst AF-KLM is just one of many companies which operate in the
French MRO market, it current state of affairs is reflective of the challenges facing many other
MRO providers. For this reason, Visiongain predicts that the French MRO market will lose market
share and only achieve a moderate CAGR rate during the forecast period.



AFI-KLM October 2012 Signed a long-term maintenance and pooling contract with Fl ybe-
Finnair joint venture Fl ybe Finland. The agreement covers an
extensive array of components, including the propellers of the
turboprop aircraft which included three ATR 42s and eleven ATR
72s. The contract includes access to a spares pool located at AFI
KLM E&M's Roissy-CDG Logistics Centre, and the lease of a Main
Base Kit, to be positioned at Fl ybe Finl and's Vantaa-Helsinki
airport main base.
AFI-KLM
E&M
J uly 2012 LOT Polish Ai rlines signed a long-term component support
agreement with AFI KLM E&M for its fleet of Boeing 787
Dreamliners, which will ultimately comprise eight aircraft. LOT was
scheduled to deploy the Dreamliner in J anuary 2013. The support
provided for LOT Polish Ai rlines covers repairs and pool access
for more than 600 part numbers, together with logistics support and
the provision of a stock of spare parts at the customer's main base.
AFI-KLM
E&M
May 2012 Ai gl e Azur renewed work with AFI KLM E&M by signing a
component support contract for its fleet of A320s. The contract is a
flight-hour agreement for component support, with pool access and
repairs. It also includes major overhauls (C-Checks) on a non-
exclusive basis.
Table 5.13 France Commercial Aircraft MRO Major Contracts & Programmes
(Company, Date, Details)

Page 83

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World Commercial Aircraft Modernisation,
Repair and Overhaul (MRO) Market 2013-2023
5.10 Indonesian Commercial Aircraft MRO Market 2013-2023



2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2013-23
Sales $bn 1.1 1.2 1.3 1.3 1.4 1.5 1.6 1.7 1.9 2.0 2.1 17.2
AGR (%) 6.4 6.7 6.8 6.9 6.9 7.0 6.8 7.0 6.8 7.0 6.8
2018-23 6.8
6.8
6.8 CAGR (%) 2013-18
CAGR (%) 2013-23








2013 2018 2023





0%
1%
2%
3%
4%
5%
6%
7%
8%
0.0
0.5
1.0
1.5
2.0
2.5
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Mkt Value ($bn) AGR (%)
Year
S
a
l
e
s

$
b
n

A
G
R


2.2
%
2.6%
2.9%
Source: Visiongain 2013
Table 5.25 Indonesian Commercial Aircraft MRO Market Forecast 2013-2023 ($bn,
AGR %, CAGR%, Cumulative)

Source: Visiongain 2013
Figure 5.22 Indonesian Commercial Aircraft MRO Market Share Forecast 2013, 2018
and 2023 (% Share)

Source: Visiongain 2013
Figure 5.21Indonesian Commercial Aircraft MRO Market Forecast 2013-2023 ($bn,
AGR%)
Page 101

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World Commercial Aircraft Modernisation,
Repair and Overhaul (MRO) Market 2013-2023
7. Expert Opinion ____

7.1 AFI-KLM E&M
Sbastien Weber is the Vice President of Marketing and Product Development at AFI KLM E&M.
AFI KLM E&M is an international recognized major provider of maintenance, repair, overhaul and
modification services for commercial aircraft. Sbastien Weber kindly provided answers to
Visiongains questions in April 2013.

7.1.2 Understanding AFI-KLMs Involvement in MRO
Visiongain: Could you outline your involvement with MRO and some of the recent work that
you have been doing?

Sbastien Weber: As you know, before 2004, AFI and KLM E&M were competitors in the MRO
market. We maintained the fleets of our parent companies, AF and KLM respectively, and we
provided MRO services to external customers. In 2004 AF and KLM merged to form a joint
commercial organization. AFI-KLM E&M became a division of this organization meaning that we
have one target plan, one budget and one reporting system. Subsequently, we created centers for
excellence to deal with specific products and services based on each companys experiences.
Traditionally, KLM were Boeing orientated before they ordered the A330 whilst Air France was
more Airbus orientated even though it had some 777 and some 747s. Following the merger, both
companies split and spread the work which they were able to do at their own facilities in order to
avoid overlaps. Of course, KLM still performs line maintenance on their own fleet and they do their
own work for the 777 and the A330 whilst Air France does the same thing for its own aircraft at its
main base. But component and engine maintenance, heavy checks modifications and secondary
services like working on APUs and thrust reversers are all done at these centers of excellence.
Presently, AFI KLM E&M is in the middle of a programme, known as Transform 2015, to reduce
costs and restructure the company in such a way that will bring us closer to our customers.

Our involvement within the MRO business is to serve our customers with a whole range of services
including engineering and airframe, component and engine maintenance, APUs, modifications and
even training services. We can provide a turnkey solution to our customers who might need work
done on a very specific aircraft type, component part, or who have a limited budget or time frame in
which they need to get work done on their aircraft. We also provide other customers with Total
Care packages. So our MRO services encompass a broad range of services from individual aircraft
to airlines requiring maintenance on an entire fleet. We service every type of Airbus and Boeing
Page 104

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World Commercial Aircraft Modernisation,
Repair and Overhaul (MRO) Market 2013-2023
8. Leading Companies in the Commercial Aircraft MRO
Market

8.1 AAR Overview

2011
Total company revenue $bn
$2bn
Headquarters
Illinois, USA
Ticker
AIR
IR Contact
Tel: 630-227-2075
http://www.aarcorp.com/contact.htm
Website
http://www.aarcorp.com/



Product Specification
Overhaul and Maintenance

Duluth 80,000 Sq ft.
Hot Springs five nose to tail maintenance lines
Indianapolis 10 bays
Miami - 226,000 Sq ft. for C and D checks
Oklahoma - Full Service at seven hangars
Component Repair Overhaul, Replacement, Exchange, Scrap Replacement
Options
Composite Repair Produces advanced structures using autoclave cure, oven
cure, resin transfer moulding (RTM), compression moulding
and vacuum assisted resin transfer moulding (VARTM)
Engineering Services n/a
Landing Gear, Wheels and
Breaks
Repair for 43 types of aircraft, both commercial and military



Table 8.2 AAR Products / Services (Product, Specification)
Source: Visiongain 2013
Table 8.1 AAR Overview 2011 (Total Revenue, HQ, Ticker, Contact, Website)
Source: Visiongain 2013