go backCrystal Ball: MRO Outlook for 2026
Laura Roke
Commercial Director at Magnetic Group
More than 28,000 commercial aircraft are in service worldwide, and on paper, the aviation maintenance market looks unstoppable.
The global MRO market is forecast to reach ~US$120B in 2025, up from US$114B in 2024, with a 2.7–3.2% CAGR projected through 2035. Traffic is back above 2019 levels. Narrowbody utilisation is high. Widebodies have returned faster than many forecasts. Order books stretch a decade. Shop visit demand is being booked years in advance.
But this is not a rising-tide story.
Inside the hangars, it’s a capacity management story. A labour story. A certified staff story. A supply chain story. A working capital story. Pricing, TATs – you name it.
For 2026, demand is not the question. Execution is.
The Market Is Growing – Here’s What’s Actually Driving It
The global commercial MRO market is projected to exceed $120 billion by the second half of this decade, with compound annual growth rates in the mid-single digits, according to multi-year industry outlooks from Aviation Week and Oliver Wyman.
Ageing fleet extension. Delivery delays from both Boeing and Airbus have forced airlines to retain mid-life and mature aircraft longer than planned. As of the latest IATA reporting, the average age of the global commercial fleet has climbed to around 15 years – the highest on record.
Older aircraft don’t just require more scheduled maintenance in the form of C- and D-checks. They generate more unplanned maintenance, which increases volatility inside the hangar.
Delivery backlogs. The global order backlog now exceeds 17,000 aircraft, with replacement timelines extended to approximately 14 years in some programmes. Airbus reported a record backlog of ~8,754 commercial aircraft at year-end 2025. Boeing’s stood at ~6,713. Every year of delivery slippage extends MRO demand on existing fleets – more hours in the air means more maintenance in the hangars.
Engines Are the Epicentre
Engine durability issues. Accelerated inspection and removal programmes affecting the Pratt & Whitney GTF family have permanently altered shop visit planning through the latter half of the decade. Durability and manufacturing defects in key engine components – particularly the high-pressure turbine (HPT) and compressor disks – are expected to ground hundreds of aircraft at various points between 2026 and 2027.
At the same time, durability management on CFM International LEAP engines has resulted in increased early shop visits compared to initial programme assumptions. Approximately 95,000 overhaul events are forecast this decade. These are not demand shocks – they are long-tail maintenance realities.
If you want to understand where margin pressure and operational risk sit in 2026, look at engines. Engines represent roughly 40–50% of total MRO spend and are the most capacity-constrained segment. Mature CFM56-5B and CFM56-7B types will remain the most common in engine shops, but new-technology engines are rapidly filling the pipeline.
GTF inspection campaigns have created a multi-year wave of unscheduled removals, with Pratt & Whitney’s public guidance pointing to hundreds of additional shop visits above normal forecasts. LEAP shop visit counts are increasing as early-production engines reach first-run removals.
The downstream effects are significant:
- Used serviceable material (USM) markets are tight, and LLP pricing has remained firm
- Turnaround times have extended across most global shops
- Slots are being booked 12–24 months in advance (especially for new tech engines)
- Airlines are accepting longer ground time as a consequence
- Bridging engine lease rates have increased (especially CFM56 engines)
- Working capital requirements for MROs are expanding due to parts pre-buying
The engine shop is no longer a back-end service function. It is the pacing item of the global fleet.
The Macro Challenges and Geopolitical Risk Nobody Wants to Talk About
The revenue line looks strong. The cost line is volatile – and will remain so.
Labour and wage pressure. Skilled technician shortages persist globally. Wage inflation in Eastern Europe and the Baltic region – historically cost-competitive MRO locations – has steadily eroded the labour cost advantage that many operators have relied on. To be direct: Tallinn – main base of Magnetic Group is not Barcelona, Rome, or Lisbon.
The cost advantage against larger MRO players has compressed. Western Europe and North America remain constrained in licensed personnel. Demand visibility is high. Labour scalability is not.
Airline liquidity and interest rates. The industry has crossed into trillion-dollar territory – global passenger load factor hit a record 83.6%, and international traffic grew 5.8%. But profitability is fragile.
Aviation fuel in 2026 is forecast at around $88 per barrel under baseline assumptions, though ongoing instability in the Middle East introduces meaningful upside risk to that figure.
Up today fuel price reached abnormous number – above $100 for a barrel. Fuel typically represents 30–40% of carrier operating costs, so even modest price movements have a significant P&L impact.
Higher interest rates have raised borrowing costs for airlines and lessors alike, affecting payment timing, contract renegotiations, and risk allocation in power-by-the-hour agreements.
Counterparty risk management is no longer a finance-only concern – it is a commercial strategy. We saw major airline collapses across multiple regions in 2025. There will be more in 2026.
The invasion and ongoing war in Ukraine and the continuing conflict in the Middle East are reshaping the operating environment for global aviation in ways that extend well beyond airspace closures.
The knock-on effects for the MRO industry are specific and structural: supply chain routing has changed, sanctions exposure requires active compliance management, titanium supply chains have been disrupted, and regional capacity concentration has become a risk factor in its own right.
Parts sourcing is no longer purely a question of price. It is a question of strategy, data management, and predictability.
Pricing discipline in 2026 will separate operators who understand this from those still chasing volume.
Execution Will Decide the Winners
The market is not short of demand. It is short of consistency – on both sides of the relationship, MROs and operators alike.
Inside the hangar, four variables will determine performance in 2026.
Workforce
Recruitment pipelines are improving, but experience gaps remain. Productivity per technician is lower in junior-heavy teams. MROs are actively competing for experienced staff, which means higher salaries and higher organisational costs. Some are building longer-term pipelines – Magnetic MRO runs its own Aviation Academy as part of that strategy.
Parts lead times
OEM allocation policies are limiting scheduling flexibility for independent MROs. USM scarcity and elevated pricing are adding further complexity. Inventory strategy is now a competitive strategy – and how much capital an MRO is willing to invest in stock is a genuine differentiator.
OEM delays and documentation
Service bulletins, engineering approvals, and warranty coordination are increasingly affecting turnaround times. Administrative lag has become a measurable operational cost.
Hangar utilisation
The real KPI for 2026 is managing the full calendar, not just peak season. The maintenance window is contracting – high season in the hangars now runs roughly from late October to late April, two to three months shorter than it was a decade ago. Summer slots, when airlines want every aircraft flying, are the challenge.
The winners will be those who optimise slot mix, maximise summer utilisation – two-shift models being one route – and manage material flow accordingly. Not simply those who sign long-term agreements.
What This Means for 2026
New capacity is coming online across Asia, the Middle East, and parts of North America. Several engine shops are expanding lines. Some airlines are pursuing hangar acquisitions or new builds to eliminate slot availability risk.
We are also seeing M&A activity across leasing companies as they look to strengthen and diversify portfolios and share risk. But new square footage does not immediately equal new output.
2026 will likely feature continued peak-season bottlenecks and margin divergence between disciplined and volume-driven operators.
Demand is no longer the differentiator. Every operator has a backlog. Every MRO has its own challenges.
Competitive advantage will be won in workforce retention, material forecasting accuracy, slot discipline, and contract risk management.
The MRO boom is real. But in 2026, margins will belong to those who execute – not just those who participate.
