Power by the Hour (PBH) Market Size By Component (Engine, Landing Gear & Brakes, Spare Parts & Components, Airframes), By Platform (Commercial Aviation, Business Jet, Commercial Helicopters), By Application (Line Maintenance, Heavy Maintenance), Industry Analysis Report, Regional Outlook, Growth Potential, Competitive Market Share & Forecast, 2019 – 2025

Published Date: Oct 2019  |  Report ID: GMI4404  |  Authors: Ankita Bhutani, Preeti Wadhwani

Report Format: PDF   |   Pages: 260   |   Base Year: 2018




Summary Table of Contents Industry Coverage Methodology

Industry Trends

Power by the Hour Market size exceeded USD 20 billion globally in 2018 and is estimated to grow at over 6% CAGR between 2019 and 2025.
 

Power by the Hour Market

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Power by the Hour (PBH) is a maintenance program provided by aircraft manufacturers as well as aircraft engine & component providers to aircraft operators. The program acts as an insurance policy for the commercial airlines, air charter, and corporate jet operators for unscheduled aircraft maintenance. The program is an agreement between aircraft operators and component suppliers. Under this agreement, the component supplier or the MRO service provider agrees to provide a certain amount of component/ scheduled maintenance during the agreement time frame.
 

The industry has evolved with the changing requirements of aircraft operators over a period. The overall aviation industry is looking to cut down their operational cost by reducing maintenance and inventory management expenses. Rolls-Royce started the initial Power by the Hour program in 1962 for supporting Viper engines in 125 business jets. Under this program, the company offered the replacement & maintenance of complete engine accessories for a fixed cost per flight hour basis. Currently, there are various types of programs offered by MRO service providers, aircraft manufacturers, engine manufacturers, and component providers. The major components covered under this program are engine and land gear & brakes as these are the major components of the aircraft and require regular maintenance for smooth functioning. For instance, in August 2019, Air Canada signed a new contract with Rolls-Royce to provide Trent 700 engine for Airbus A330 aircraft fleet of the airlines. The airlines opted for the TotalCare Flex agreement, providing Trent 700 engines until the A330 fleet retires. The TotalCare Flex program is designed for the operators of mature engines and this program is best suited for airlines looking for the economic management of older aircraft engines.
 

The expanding low-cost airline sector is fueling the demand for aircraft maintenance as most of the airlines outsource the maintenance service to third parties. Most of the service providers offer various types of programs as per customer requirements to cater to this demand. With the rising applications of digitalization in aircraft maintenance, the demand for economical maintenance programs will support the power by the hour market growth.
 

Power by the Hour (PBH) Market Report Coverage
Report Coverage Details
Base Year: 2018 Market Size in 2018: USD 20 Billion
Historical Data for: 2014 to 2018 Forecast Period: 2019 to 2025
Forecast Period (2019 to 2025) CAGR: 6.3% 2025 Value Projection: USD 30 Billion
Pages: 260 Tables, Charts & Figures: 327
Geographies covered (21): U.S., Canada, UK, Germany, Italy, Spain, France, Russia, China, India, Japan, South Korea, Australia, Brazil, Mexico, Argentina, Colombia, South Africa, Saudi Arabia, Israel, UAE
Segments covered: Component, Platform, Application, and Region
Companies covered (20): A J Walter Aviation Limited, AAR, AIR FRANCE-KLM Engineering & Maintenance, Ameco, EFTEC UK Ltd., Evergreen Aviation Technologies (EGAT), Exodus Aviation, GE Aviation, Guangzhou Aircraft Maintenance Engineering Co., Ltd., Honeywell International Inc., Hong Kong Aircraft Engineering Company Limited, JSSI, Lufthansa Technik, MTU Aero Engines AG, Rolls-Royce plc, SIA Engineering Company, Singapore Technologies Engineering Ltd., Textron Inc., Turkish Technic Inc., United Technologies
Growth Drivers:
  • Rise in air traffic in Asia Pacific
  • Rising transparency between industry players and customers
  • Strategic shift from product oriented to service-oriented approach
  • Stringent government regulations for maintaining operational quality
  • Introduction of Aerospace 4.0
Pitfalls & Challenges:
  • High manufacturing cost
  • Shortage of resources

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Increasing demand for inventory management in rotable components

The major components included in the power by the hour study are engine, landing gear & brakes, spare parts and airframes. Spare parts & components are expected to grow at a CAGR of over 6% during the forecast period due to the increase in the demand for inventory management for rotable components across the globe. For instance, in January 2016, Braathens Regional Airways AB selected Sabena Technics to provide support to rotable components. Under this contract, the company will provide support for the ATR 72 fleet. The company will provide complete service from equipment warranty management to component pool along with logistic services. The contract will help airlines to reduce their maintenance costs and increase their operational efficiency.
 

Power by the Hour Market Revenue, By Component, 2014-2025, (USD Million)
Power by the Hour Market Revenue, By Component, 2014-2025, (USD Million)

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The spare parts and components include pumps, avionics, temperature sensors, oil coolers, heat exchanges, and propeller equipment. Major spare parts and component providers offer a complete inventory management solution to aircraft operators including logistics, parts certification, and other paperwork required by operators. For instance, in June 2016, CommutAir signed a contract with AAR Corp. for component support. Under this contract, AAR will provide component support for the ERJ 145 aircraft. AARs supply chain service management will take care of the complete inventory management for all the rotable & replacement parts.
 

Increased focus on reducing operational costs

Most airlines are trying to minimize their operational costs by reducing the fuel consumption and aircraft maintenance costs incurred for unscheduled maintenance. Most of the low-cost airlines will reduce their operational costs by maintaining a single fleet type, reducing the maintenance & training costs incurred by airlines. The program helps airlines to reduce their operational cost as by reducing risks of unscheduled maintenance and reduce their Aircraft on Ground (AoG) by maintaining a pool of rotable components for repair & replacement.
 

Passenger traffic growth in regions such as India and China and increasing tourism in the Middle East & Africa regions are the major factors supporting commercial aviation growth. The increasing demand for narrow body aircraft by low-cost airlines will fuel the demand for power by the hour programs across regions.
 

Rising demand for line maintenance from low-cost airlines in Asia Pacific

APAC Power by the Hour Market Revenue, By Application, 2014-2025, (USD Million)
APAC Power by the Hour Market Revenue, By Application, 2014-2025, (USD Million)

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The line maintenance segment is expected to grow at a CAGR of over 6% due to the increase in narrow body fleet size, expansion of new routes, and increasing focus on regional connectivity from countries including China and India. According to the IATA, passenger traffic is expected to grow at a CAGR of 3.5% in the next two decades. The growth of passenger traffic in Asia Pacific is expected to grow at a CAGR of 4.8%. The routes in and from Asia Pacific will have an extra 2.35 billion annually by 2037. Increasing tourism and rising per capita income of the middle-class population are supporting the demand for air travel. Huge investments in airport infrastructure are also supporting passenger traffic growth in the region.
 

Presence of major airlines and aircraft manufacturers in North America

North America held a power by the hour market share of over 25% in 2018 due to the presence of major airlines, engines, components, and aircraft manufacturers in the region. For instance, in June 2019, VivaAerobus signed a contract with Pratt & Whitney to provide a GTF engine for 41 A321 Neo aircraft. Under this contract, the company will also provide engine maintenance services for 12 years by EngineWise service agreement. The company under EngineWise provides a comprehensive coverage of engine maintenance, which is payable upon the rate agreed by the customer for per flying hour. This program will help airlines to reduce maintenance costs and increase the wing time for the engine.
 

Power by the Hour market characterized by long-term contracts between players

The companies operating in the power by the hour market are focusing on long-term contracts to capture market share in the market. For instance, in June 2019, Pratt & Whitney signed a contract with Mandarin Airlines for Fleet Management Program (FMP). Under this contract, the company will provide maintenance service for 18 PW127M engines. FMP is a tailor-made flexible maintenance agreement for fleet operators and the company provides hot section inspection, unscheduled engine maintenance, engine refurbishments, and diagnostics under this. The company also provides additional services, which include parts replacement, rental engine support, and repair.
 

Some of the major companies operating in the market are Lufthansa Technik, Rolls-Royce plc, United Technologies, MTU Aero Engines AG, Textron Inc., A J Walter Aviation Limited, AAR, AFI KLM E&M, Turkish Technic, GE Aviation, Singapore Technologies Engineering LTD, SIA Engineering Company, Exodus Aviation, Ameco, JSSI, EFTEC UK LTD, Hong Kong Aircraft Engineering Company Ltd., Guangzhou Aircraft Maintenance Engineering Company Ltd (GAMECO), Honeywell International Inc., and Evergreen Aviation Technologies (EGAT).
 

The Power by the Hour (PBH) market research report includes in-depth coverage of the industry, with estimates & forecast in terms of revenue in USD from 2014 to 2025, for the following segments:

By Component

  • Engine
  • Landing Gear & Breaks
  • Spare Parts & Component
  • Airframes

By Platform

  • Commercial Aviation
    • Narrow Body Aircraft
    • Wide Body Aircraft
  • Business Jet
  • Commercial Helicopter

By Application

  • Line Maintenance
  • Heavy Maintenance

The above information has been provided for the following regions and countries:

  • North America
    • U.S.
    • Canada
  • Europe
    • UK
    • Germany
    • France
    • Spain
    • Italy
    • Russia
  • APAC
    • China
    • Japan
    • India
    • Australia
    • South Korea
  • LAMEA
    • Brazil
    • Mexico
    • Argentina
    • Colombia
  • MEA
    • South Africa
    • Saudi Arabia
    • UAE
    • Israel

Frequently Asked Questions (FAQ) :

Power by the Hour (PBH) is a maintenance program provided by aircraft manufacturers as well as aircraft engine & component providers to aircraft operators. The program acts as an insurance policy for the commercial airlines, air charter, and corporate jet operators for unscheduled aircraft maintenance.
According to this GMI report, the power by the hour market size exceeded USD 20 billion globally in 2018.
North America held a PBH market share of over 25% in 2018 due to presence of major airlines, engines, components, and aircraft manufacturers in the region.
The Power by the Hour (PBH) industry is estimated to grow at over 6% CAGR between 2019 and 2025, as estimated by analysts at Global Market Insights, Inc.
The line maintenance segment is expected to grow at a CAGR of over 6% due to increase in narrow body fleet size, expansion of new routes, and increasing focus on regional connectivity.

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