Power by the Hour (PBH) Market Analysis

Power by the Hour Market Analysis

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.

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.
 

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.
 

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.
 

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.