Air travel’s growth and its race to hit climate targets open an opportunity for the Republic to create thousands of jobs and earn billions in revenue, a new report argues.
Spending on aircraft engine maintenance, repair and overhaul will grow to $156 billion (€134 billion) by 2035 from $119 billion this year as global airlines buy new planes powered by more efficient engines, say Dudley Shanley and Antonio Duarte, analysts with stockbroker Goodbody.
The Republic’s position as a leader in global aircraft leasing puts it in a “unique position” to offer engine maintenance, repair and overhaul services to airlines, they argue.
“Capturing even 1 to 2 per cent of this market could generate billions in revenue and thousands of high-skilled jobs for Ireland,” Mr Shanley and Mr Duarte point out.
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They calculate that establishing three- to five-engine maintenance facilities here by 2030 would create about 2,500 jobs.
Their report: Ireland’s opportunity, the engine MRO “super cycle” will feature at a conference, Invest in Aviation, hosted by Goodbody on Thursday in Dublin.
The report notes that there are several successful aircraft maintenance businesses in the Republic, although these focus more on airframes – the structure of the plane itself – rather than on engines.
Mr Shanley and Mr Duarte maintain that engine maintenance is a particularly highly skilled, well-paid division of the industry.
The recent Pathfinder for Irish Aviation report, backed by businessman Declan Ryan’s Irelandia, called for the expansion of the maintenance industry here by building at least one engine repair facility at either Derry or Shannon airports.
Mr Shanley and Mr Duarte argue that IDA Ireland, the agency charged with luring multinational investment to the Republic, should be “actively looking” at providing support for a maintenance, repair and overhaul industry.
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That would involve building on the State’s dominance of the leasing industry. Companies based here manage more than half the world’s leased aircraft.
It would also require locating engine facilities, suppliers and training and education in the same place, along with investment in education and training.
The analysts say that the Republic should focus initially on specialising in one area of the industry, such as short-haul aircraft engines, where demand is expected to grow fastest.
“The IDA could help to attract original equipment manufacture partnerships while the Irish Strategic Investment Fund could co-invest in the facilities,” says the report.
“The Government could offer research and development tax credits for engine maintenance, repair and overhaul innovation in areas such as engine diagnostics, predictive maintenance and tooling.”
