Aviation Support Services

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 4,300 aviation support services in the US provide airport operation, repair, maintenance, storage and ferrying services. Primary services offered include maintenance and repair; fixed base operators (FBO) services; airport administration and operation service; and handling services for goods (cargo, baggage). Other services include air traffic control, runway services (cleaning, snow removal), de-icing, and parts inventory management services.

Regulated Environment

The US aviation industry is heavily regulated by the Federal Aviation Administration (FAA) which sets the standards for repair and operation of all aircraft and parts.

Advances in Technology

Advances in technology have fundamentally changed the need for maintenance, repair and overhaul services.

Industry size & Structure

The average US aviation support services provider employs about 51 workers and generates $7-8 million annually.

    • The US aviation support services industry consists of about 4,300 firms that employ 230,200 workers and generate over $32 billion annually.
    • The industry is moderately concentrated at the top and fragmented at the bottom; the top 50 companies account for about 57% of industry revenue.
    • Large MRO firms include AAR and Aviation Technical Services (ATS). Foreign firms, such as HAECO, offer aviation support services through domestic subsidiaries and joint ventures.
    • The top 100 US aviation markets typically contract with a chain fixed base operator (FBO), such as Signature Flight Support and Atlantic Aviation.
                                Industry Forecast
                                Aviation Support Services Industry Growth
                                Source: Vertical IQ and Inforum

                                Recent Developments

                                Mar 19, 2024 - Firms Increase Prices
                                • Aviation support services modestly raised their prices during 2023, according to the US Bureau of Labor Statistics (BLS). Labor costs increased during 2023 as employment increased slightly during the period while average wages for nonsupervisory employees increased significantly, according to the BLS.
                                • The recovery in global air travel continued in 2023 with traffic edging closer to matching pre-pandemic demand, according to The International Air Transport Association (IATA). Total traffic (measured in revenue passenger kilometers) increased 36.9% year over year in 2023 and was at 94.1% of pre-pandemic (2019) levels. US traffic increased 30.4% year over year in 2023 and was 3.9% above the full year 2019 level.
                                • US Securities and Exchange Commission (SEC) officials said in late 2023 that the agency's long-anticipated climate rules may scale back some of the most demanding greenhouse gas emissions disclosure requirements that it had proposed, according to Reuters news service. Aviation support services serving as contractors to government agencies are likely to be impacted, as a forthcoming rule proposal from the Biden administration that would require public companies and contractors supplying goods and services to the federal government to disclose greenhouse gas (GHG) emissions and other climate-related risks is expected to follow the climate change risk disclosure requirements proposed by the SEC. Federal contractors are advised by industry experts to devise and execute procedures to document and track GHG emissions information both companywide and those attributable to specific procurement contracts.
                                • Sustainable aviation fuel production capacity could potentially increase from 25 million gallons now to nearly 2.2 billion gallons by 2026, according to multinational banking and financial services company Rabobank. SAFs are renewable fuels with similar properties to conventional jet fuel but with a smaller carbon footprint. All SAFs currently approved for commercial use have been derived from biological feedstocks. They are approved for blending with conventional jet fuel at rates up to 50%. “For the time being, biofuels are the only viable solution or feedstock for SAFs, and SAFs offer tremendous potential for the industry for the next 20 years,” Rabobank senior analyst Owen Wagner said. Two of the biggest uncertainties regarding SAFs are policy uncertainty and future competition from non-biobased SAF feedstocks, according to Wagner.
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