MCTG December 2019

Airline Maintenance Cost

Executive Commentary
Edition 2019
An Exclusive Benchmark Analysis (FY2018 data)
by IATA’s Maintenance Cost Technical Group

PUBLIC VERSION
Table
of Contents

Preliminary Remarks . . . . . . . . . . . . . . . . . 2

Data & Analysis Methodology . . . . . . . . . . . . . . 4

Definitions & Acronyms . . . . . . . . . . . . . . . . 5

1. Global Picture . . . . . . . . . . . . . . . . . . . 7
1.1. Airline Industry Landscape in 2018 8
1.2. World Fleet 11
1.3. Maintenance, Repair & Overhaul (MRO) Market 14

2. FY2018 Snapshot . . . . . . . . . . . . . . . . . 17
2.1. Fleet Overview 18
2.2. Maintenance Cost Analysis 21
2.2.1. Direct Maintenance Spend 21
2.2.2. Direct Maintenance Spend by Aircraft Category 24
2.2.3. Personnel & Overhead  26
2.3. Aircraft Leasing & Maintenance Reserves  29
2.4. Spare Parts Inventory 33

3. Analysis by Airline Group . . . . . . . . . . . . . . 37

3.1. Fleet Overview  38
3.2. Maintenance Cost Analysis by Airline Group 40
3.3. Aircraft Leasing & Maintenance Reserves by Airline Group  43

4. Trend Analysis . . . . . . . . . . . . . . . . . . 47
4.1. Fleet Overview 48
4.2. Maintenance Cost Overview 51
4.3. General Trends 56
4.4. Trend Analysis by Airline Group 58

5. Trend Analysis by Aircraft Category. . . . . . . . . . . 63

5.1. Overview by Aircraft Category 64
5.2. Narrowbody Aircraft 66
5.3. Widebody Aircraft 68
5.4. Regional Jets 70
5.5. Turboprops 72

Annex I: MCTG Fleet vs World Fleet . . . . . . . . . . . . 74

Annex II: Base and Component Maintenance Costs by Airline . . . 75

Annex III: Staff . . . . . . . . . . . . . . . . . . . 76

Annex IV: Mechanics and Overhead Staff Breakdown . . . . . 77

Annex V: Time Breakdown . . . . . . . . . . . . . . . 80

Annex VI: Fleet Distribution by Aircraft Family and by Group . . . 81

Annex VII: Operational Data by Aircraft Category . . . . . . . 82

Preliminary
remarks
The Maintenance Cost Technical Group (MCTG) – formerly known as
Maintenance Cost Task Force (MCTF) – collects maintenance cost
data from airlines worldwide on an annual basis. The goals of MCTG
are to provide the tools, methodology and definitions to be able to
determine how much it costs an airline to maintain its fleet and be
able to use the data in cases of new fleet introduction or expansion,
“make vs. buy” decisions, year-over-year trends, etc.

This report is exclusively distributed to airlines that The importance of data quality
provided data for 2018.
It takes a fair amount of time for MCTG airlines to
We are doing our maximum to present meaningful gather and submit data, and it takes a lot of effort
analysis and we encourage you to provide feedback to validate this data in order to deliver the most
on this report so we can enrich it again next year. relevant benchmark analysis. We often need to
We regularly send out a survey to airlines in order contact airlines and ask for clarifications when
to gather their advice on how to improve this report numbers do not meet the quality checks set. For
and its content. this initiative to remain viable and reliable, it is
critical to focus on the best possible data quality.
MCTG data collection is open to all commercial That’s why we would like to remind you of the
airlines worldwide that would like to benchmark importance of making sure your data are accurate
their cost to maintain their fleet. MCTG does not before submitting it. For that purpose, built-in
discriminate between IATA and non-IATA member checks are included in the data collection form (on
airlines. MCTG does not discriminate between three tabs: Summary Tables, Summary Graphs and
major, domestic, international, low-cost, regional P&O Graphs) in order to help you get an idea of the
airlines, etc. main metrics (e.g. maintenance cost per flight hour,
per flight cycle or per aircraft). Unscheduled events
can cause dramatic impact on maintenance spend,
that is why we need also as many comments to
explain unusually high or low costs.

2 Preliminary Remarks
The importance of reporting to cycle ratio, utilization, harsh environment, etc.),
aircraft ageing, fleet size and commonality, labor
operational data rate, etc. Additionally, it should be noted that the
The focus of MCTG is clearly on maintenance analysis is done in USD as most of the aircraft parts
costs, however operational data (e.g. flight hours, are marketed in USD; therefore, currency exchange
cycles, ASK, fleet size and fleet age) and personnel rates may play a significant role in benchmarking
& overhead data (e.g. number of mechanics and maintenance costs, especially when substantial
overhead staff, time breakdown, overhead costs, foreign exchange fluctuations and/or currency
etc.) are very important to calculate unit costs and devaluation take place.
KPIs. We would like to draw your attention on the
Finally, the aircraft delivery schedule and the
importance of reporting accurate cost data and
periodicity of the maintenance program can
operational data in order to get the best benchmark
strongly influence costs, especially when many
data and analysis possible for the benefit of the
aircraft were delivered within a short period of time.
airline industry and your own airline.

The importance of data treatment The acceptance of data

This report analyzes and comments data from 54
All the MCTG analyses presented in this report use
airlines. Due to late submission, insufficient data
maintenance cost data as they were provided by the
and poor data quality, a few other airlines’ data was
airlines through the standardized IATA toolset. No
excluded from the analysis and report.
attempt was used to normalize the data based on
any parameters such as operational severity (hours

Preliminary Remarks 3
Data & Analysis
Methodology
IATA’s Maintenance Cost Technical Group (MCTG) All data presented in this report are de-identified.
collects maintenance cost data from airlines The two-digit airline codes shown in this report
worldwide on an annual basis. are unique codes given to the participating airlines
for de-identification purposes. Although some of
MCTG Airlines are the carriers which participate
these codes may match real IATA airline codes, this
in the annual data collection. 54 airlines reported
is merely a coincidence. If you do not know your
data for FY2018, however one airline was excluded
airline’s code, please contact us at [email protected].
from this report, because they submitted past the
deadline and/or data that did not pass the quality Typical metrics include: cost per flight hour, cost
checks and subsequent questions to clarify data. per departure, cost per aircraft. The cost data unit
is US dollar, and the length unit is kilometer.
The data are then coded (operators are de-
identified) and used as reported (i.e. without any The goals of MCTG are to provide the tools,
normalization) to create this benchmark report. methodology and definitions to be able to
determine how much it costs an airline to maintain
All airline data are consolidated and then analyzed
its fleet and be able to use the data in cases of new
considering aircraft type, fleet and engine size and
fleet introduction or expansion, “make vs. buy”
models, fleet age, maintenance market segments
decisions, year-over-year trends, etc.
(line, components, engines, heavy checks and
MOD) and elements (labor, material, subcontracted
work), flight hours, cycles and geography.

4 Data & Analysis Methodology

Definitions
& Acronyms
AC Currency MRO Total Maintenance
Aircraft All amounts in this Maintenance, Repair Costs
report are in US$, and Overhaul DMC plus overhead
AFI unless specified costs
Africa otherwise. MTBR
Mean Time Between TP
AFTK DMC Removals Turboprops
Available Freight Tonne Direct Maintenance
Kilometers Costs NAM TR
North America Thrust Reversers
Aircraft Category ESV
NB, WB, RJ, TP (defined Engine Shop Visit NB Units
below) Narrow-body single K ($#,000) Thousand
EUR aisle aircraft with M ($#,000,000) Million
Aircraft Family Europe more than 100 seats B ($#,000,000,000)
Aircraft communalities (excludes Embraer Billion
(e.g. A320 Family FC 190/195)
includes A318, A319, Flight Cycle Utilization
A320, A321; 737 PLF Number of flight hours
NG includes 737- FH Passenger Load Factor per aircraft per day
600/700/800/900) Flight Hour (= FH / AC / 365 days)
Regions
Aircraft Sub-Category FLF Africa (Sub-Saharan WACC
NB, WB2, WB3+, RJ, TP Freight Load Factor Africa), ASPAC (Asia Weighted average cost
(defined below) Pacific), MENA (Middle of capital
East & North Africa),
FTK Americas (North
AL Freight Tonne WB
Airline & South America), Wide-body aircraft with
Kilometers Europe (includes CIS), more than one aisle
N. Asia (China, Hong or equivalent freighter,
APU LATAM Kong, Macao, Taiwan,
Auxiliary Power Unit combination of WB2
Latin America & Mongolia) and WB3+.
The Caribbean
ASK RJ
Available-Seat Kilometers WB2
LG Regional-jets up to Wide body aircraft
Landing Gear 100 seats (includes equipped with two
ASPAC Embraer 190/195) engines
Asia Pacific LLP
Life Limted Part RPK WB3+
Cost Elements Revenue-Passenger Wide body aircraft
Material, labor, engine MCTG Kilometers equipped with three or
life limited parts and Maintenance Cost more engines
outside repairs (or Technical Group Supply Chain
outsourced, used Includes all
interchangeably) maintenance activities
MENA
Middle East & performed by third
Cost Segments North Africa party (also called
Line, base, component “contract maintenance”
and engine or “outsourcing”) and
maintenance MR
the cost of material
Maintenance Reserves
purchased to do work
in-house

Definitions and Acronyms 5

Global
Picture
1.1. Airline Industry Landscape in 2018

1.2. World Fleet

1.3. Maintenance, Repair and Overhaul (MRO) Market

Global Picture
This section provides some context to the MCTG analysis in other sections
by presenting an overview of the airline industry, the world fleet count and the
Maintenance, Repair and Overhaul (MRO) market for 2018.

The industry recorded a net post-tax profit of US$32 billion, decreasing by 14%
compared to 2017.

In 2018, the world fleet count was 27,535 aircraft with 81% of the fleet manufactured
by Airbus and Boeing. Globally, airlines spent $69 Billion on MRO, representing
around 9% of total operational costs.

Global Picture 7
 1.1. Airline Industry Landscape in 2018

Collectively, the airline industry had a net post-tax RPKs between regions of the world grew at an
profit of US$32.3 billion, a 6.8% margin on revenues. accelerated rate in 2018, expanding by 6.5% from
The post-tax profit airlines generated this year was previous year (2017). The pick–up in the growth
lower compared with previous year ($37.7 billion trend reflected increasing demand through
reported in 2017 with an 7.7% margin). improvements in the global economic backdrop.
The available seat kilometers (ASKs) in 2018
Jet fuel prices increased significantly during 2018.
increased by 6.1% compared to last year.
The average price of a barrel of jet fuel in 2018 was
$86 per barrel (29% higher than in the previous year The passenger load factor this year (2018) has
but still lower than average between 2011 and 2015). reached 81.9% increasing of 0.6% from last year.

Source: IATA WATS 2019

Fig. 1:
$B�YEAR 62.0
Industry Net Profits 60.0 60.0
58.0
Source: IATA WATS 2019 56.0

Operating result
Net Result
36.0 37.7
36.0 35.5
34.2
32.3
28.0
25.0
20.0 20.0
17.3 18.0
14.0 12.9 13.8
10.7
8.3 9.2
4.4 2.0
-1.0
-4.1 -0.1 -15.9 -4.6
2010

2011

2012

2013

2014

2015

2016

2017

2018E

2019F
2006

2007
2005

2009
2008

Fig. 2:
US$/Barrel
Jet Fuel Price per Barrel
Annual Average 200
Source: IATA WATS 2019

Jet fuel ($ / b) 160

Crude ($ / b)

120

80

40

0
06

11
09
04

05

07

08

10

12

13

14

15

16

17

18

19
n-

n-
n-
n-

n-

n-

n-

n-

n-

n-

n-

n-

n-

n-

n-

n-
Ja

Ja
Ja
Ja

Ja

Ja

Ja

Ja

Ja

Ja

Ja

Ja

Ja

Ja

Ja

Ja

8 Global Picture
Global Picture 9
Fig. 3:
RPK Growth
by Route Area
Source: IATA WATS 2019

EUR

NAM 7.5%
5.3% ME
5.0%

ASPAC
AFI
9.5%
LATAM 6.1%
WORLD 7.0%
7.4%

AFI: Africa LATAM: Latin America & the Caribbean

ASPAC: Asia Pacific MENA: Middle East & North Africa
EUR: Europe NAM: North America

10 Global Picture
 1.2. World Fleet

In FY2018, the world fleet count was 27,535 In the last decade, airlines introduced 7,923 aircraft
aircraft. This number includes all active aircraft to their fleet, broken down as follows: 60% NB, 13%
in commercial operations. 81% of this fleet was RJ, 21% WB, and 6% TP. TPs include only ATR42/72
manufactured by Boeing or Airbus. The combined and Q300/400.
share of the other manufacturers (like Bombardier,
Embraer, Fokker, ATR and Bae) represented the
remaining 19% of the world fleet.

Fig. 4: 0.51%
World Fleet by Manufacturer 3.8% Fokker
7.18%
(2018)
Bombardier ATR 0.47%
Source: Cirium (incl. DHC) BAE Systems
(Avro & HS)
7.26%
Embraer

44.88%
Boeing
(incl. MD)

35.89%
Airbus

Fig. 5: 6%
World Fleet by Aircraft Turboprop 3%
Category (2018) Africa
Source: Cirium 7%
MENA
13%
Fig. 6:
Regional 14%
World Fleet by Region (2018) Jet North 35%
Source: Cirium Asia Americas

21% 60%
Widebody Narrowbody
Jet Jet 17%
ASPAC
24%
Europe

Fig. 5 Fig. 6

Operator in Europe and the Americas own 59% of the world fleet in 2018, followed by ASPAC and North Asia
with 31%, whereas MENA and Africa account for 10%.

Global Picture 11
Fig. 7:
Top 10 Most Popular Aircraft A320 Family 7,679
Families (2018) 737 Family 7,548
Source: Cirium
777 Family 1,429

A330/A340 Family 1,425

EJet Family 1,399

CRJ Family 1,288

ATR Family 1,045

767 Family 750

787 Family 739

DHC-8 690

A320 Family remains the most popular aircraft consisting of 7,679 AC and has a narrow lead before the
737 Family with 7,548 AC in FY2018.

Fig. 8: World Fleet Statistics FH/AC, FC/AC

(2009  -   2018)
Source: Cirium 3,000 12
2,803
2,536
FH / AC
2,500 11
FC / AC

 tilization
U 2,000 10
(Hours / day)

1,325 Utilization
1,500 1,342 9
(Hours / day)

1,000 7 68 8
6 95
500 7

0 6

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

12 Global Picture
 The average utilization in 2018 was 7.68 hours/ PLF increased from 81.4% in 2017 to 81.9% in
day (6.7% vs 2017, and 10.5% vs 2009). In FY2008, 2018.All figures in the table below are expressed
an aircraft flew on average 2,803 hours and in % change year on year, except for PLF and FLF
1,342 cycles. which are the load factors for the specific month.

Table 1:
December 2018 (% year-on-year) 2018 calendar year (% year-on-year)
Airline Passenger Market
Analysis (Dec 2018) WORLD RPK ASK PLF PLF RPK ASK PLF PLF
Source: IATA Economics SHARE 1 (%-PT)2 (LEVEL)3 (%-PT)2 (LEVEL)3

AFRICA 2.1% 2.1% 1.6% 0.4% 72.4% 2.4% 1.0% 1.0% 71.4%

ASIA PACIFIC 34.5% 6.4% 6.7% -0.2% 81.0% 8.6% 7.9% 0.5% 81.5%

EUROPE 26.7% 7.8% 8.8% -0.8% 81.0% 6.6% 5.8% 0.6% 84.5%

LATIN AMERICA 5.1% 6.0% 5.4% 0.4% 81.8% 6.2% 6.6% -0.3% 81.6%

MIDDLE EAST 9.2% 0.0% 4.2% -3.1% 73.6% 4.0% 4.9% -0.6% 74.8%

NORTH AMERICA 22.4% 3.6% 4.0% -0.3% 82.5% 5.0% 4.7% 0.2% 83.8%

TOTAL MARKET 100% 5.3% 6.1% -0.6% 80.4% 6.5% 6.1% 0.3% 81.9%

1
% of industry RPKs in 2018
2
Year-on-year change in load factor
3
Load factor level

Global Picture 13
 1.3. Maintenance, Repair and Overhaul (MRO) Market

Global MRO spend in 2018 was valued at $69 With a 4.1% increase per annum, the market size is
Billion, excluding overhead. This represented 9% of estimated to reach $103 Billion in 2028.
airlines operational costs.

Fig. 9:
World MRO Spend by Segment
(2018) 18%
Source: Alton Aviation Line
Consultancy MRO Forecast
42%
Engines
20%
Base

20%
Components

Fig. 10: 3% Africa

World MRO Spend by
region (2018)
Source: Alton Aviation 11%
Consultancy MRO Forecast
MENA

32%
Asia

24%
Europe

30%
Americas

14 Global Picture
Fig. 11:
World MRO Market Forecast
(2018-2028) 42% 9%
Source: Alton Aviation
Consultancy MRO Forecast

21% 20% 4.5%

17% 4%
3%

2018 2028
$69B $103B
ENGINE COMP LINE BASE ENGINE COMP BASE LINE

TRENDS AND MAJOR EVENTS IN 2018 Reasons for increasing MRO material costs

Fleet evolution • Annual OEM material price increases

Narrowbody aircraft will continue to dominate • OEMs restricting the direct sale of OEM
deliveries over the next decade. OAMs are offering designed parts
re-engined aircraft for a better fuel efficiency
(A320neo, 737 MAX) and developing versions of
CHALLENGES AHEAD
the narrowbody jets for longer hauls (A321 XLR).
Impact of Brexit on airline operations:
Over the same period of time, the fleet of e-enabled
aircraft is set to more than double. • Limits access to market
IATA/CFMI Agreement • Adds cost through complexity, inefficiency or
administrative burden
In July 2018, IATA and engine manufacturer CFM
International (CFMI) have signed an agreement that • Potentially leads to extensive supply chain
will lead to increased competition in the market disruption, invalidation of aircraft used across
for maintenance, repair and overhaul services the globe and planes being grounded
(MRO) on engines manufactured by CFM, a 50/50
Potential options for managing UK regulatory
partnership between GE and Safran Aircraft
framework after Brexit:
Engines.
• UK seeks to become a Third Country member of
Under the agreement, CFMI has adopted a
EASA
set of “Conduct Policies” that will enhance the
opportunities available to third-party providers of • UK builds an independent regulatory framework,
engine parts and MRO services on the CFM56 and and/or seeks bilateral arrangements on safety
the new LEAP series engines. More information and cooperation with other Third Countries
can be found on MCTG webpage.
Top three savings for airlines
SOURCES
• Health monitoring and predictive maintenance • Industry Statistics Fact Sheet – IATA (June 2019)
driven by improved dispatch reliability, labor • A study of the effects of the United Kingdom leaving the
productivity European Union on airlines flying to and from the UK –
IATA (October 2018)
• Fuel cost savings
• Aero-Engine Market Analysis - Oliver Wyman (May
• Delay reduction through improved turnaround 2019)
process • Airline Economic Analysis - Oliver Wyman (2018-2019
Edition)
To improve productivity, lower costs, and gain
• Exploring airline operation benefits of deploying IoT –
additional asset utilization, airlines are considering
Deloitte
technologies like the Internet of Things (loT) to
• Global Fleet & MRO Market Forecast Commentary
change the game.
2018-2028 – Oliver Wyman (2018)
• The MRO Market & Key Trends – ICF (January 2019)

Global Picture 15
FY2018
Snapshot
2.1. Fleet Overview
2.2. Maintenance Cost Analysis
2.2.1. Direct Maintenance Spend
2.2.2. Direct Maintenance Spend by Aircraft Category
2.2.3. Personnel & Overhead
2.3. Aircraft Leasing & Maintenance Reserves
2.4. Spare Parts Inventory

FY2018 Snapshot — 54 Airlines

This section provides the overview of FY2018 data reported by 54 airlines worldwide.
The 5-year trend analysis will be presented further in this report.

The MCTG airlines operated 4,717 aircraft in 2018, of which 92% were Airbus and
Boeing aircraft. Technical Division spend totaled $19.78 billion, of which $16.94
billion were Direct Maintenance Cost and $2.85 billion Overhead Cost.

FY2018 Snapshot 17
 2.1. Fleet Overview

In FY2018, the MCTG fleet had 4,717 aircraft, which represented 17% of the world’s fleet.
The fleet size of MCTG airlines ranged from 1 to over 600 aircraft with an average fleet age of 8.8 years.
They flew a total of 15.5 million flight hours, and 6.4 million flight cycles. Nine airlines operated both
passenger and freighter aircraft.

Table 2: EUROPE N. ASIA

Fleet Distribution by Region (includes CIS) China, Hong Kong,
(FY2018 — 54 Airlines) Macao, Taiwan and
AL 18 (33%) Mongolia
AL: Airline AC 963 (20%)
AL 4 (7%)
AGE 10.2
AC: Aircraft AC 378 (8%)
UTIL 9.4
AGE 8.8
Age: Average Fleet Age (years) UTIL 9.7

Util: Utilization (Hours / Day)

AMERICAS
North & South ASPAC
America Asia Pacific
AL 11 (20%) AL 10 (19%)
AC 1,655 (35%) AFRICA MENA AC 1,012 (21%)
AGE 8.5 Sub-Saharan Middle East AGE 8.9
Africa & North Africa
UTIL 8.6 UTIL 8.4
AL 3 (6%) AL 8 (15%)
AC 88 (2%) AC 621 (13%)
AGE 10.0 AGE 6.8
UTIL 8.0 UTIL 10.4

18 FY2018 Snapshot
Fig. 12:
67 A/C
Fleet Distribution by
1.4%
Manufacturer 127 A/C
(FY2018 — 54 Airlines) 2.7%

Boeing 207 A/C

4.4%
Airbus

Embraer

ATR
2,380 A/C
Bombardier 50.5%
1,936 A/C
41.0%

Fig. 13:
Fleet Distribution 182 A/C 176 A/C
by Aircraft Category 4% 4%
(FY2018 — 54 Airlines)
225 A/C
NB 5%

WB2

RJ

WB3+ 2,649 A/C

56%
TP 1,484 A/C
31%

The MCTG fleet mix is slightly different from the flight cycles per aircraft on average. In 2018,
world fleet. Boeing (including McDonnell-Douglas) widebody aircraft represented 35% of the fleet with
and Airbus are overrepresented in MCTG fleet. They an average age of 8.8 years (8.9 years for NB).
account for 92% of MCTG fleet vs 81% of worldwide Each widebody aircraft (WB) flew on average 3,895
fleet. On the contrary, Embraer, ATR and Bombardier hours and performed 767 cycles (Table 2). Regional
have a combined share of 8% of MCTG fleet vs 18% (RJ) and Turboprop (TP) fleets are underrepresented
worldwide. (Fig. 12) in the MCTG analysis because reporting carriers
As shown in Fig. 13, narrowbody aircraft (NB) were mostly have larger aircraft.
the most popular aircraft (56% of 54 MCTG airlines' More details on MCTG fleet vs Worldwide Fleet in
fleet) with 3,089 flight hours per aircraft and 1,642 Annex I.

FY2018 Snapshot 19
Fig. 14:
Fleet Demographics AIRCRAFT AIRLINES
(FY2018 — 54 Airlines) 33
1,400 35
Airlines

Aircraft 1,200 20 30

24
1,000 25

800 17 20
15

600 15
10 10
9 9
400 7 10
5 5
4 4
3 5
200

0 0
A320 Family

737 NG

777

A330

787

767

EMB190/195

ATR72

A350

747-400

Q400

737 Max

A340

EMB170/175

737 Classic
MCTG airlines operated 25 different aircraft have been removed because they did not meet the
families in 2018. Figure 3 represents only the Top ‘3 operators/5 aircraft’ rule. The rest of the fleet (not
15 aircraft families with a minimum of 3 operators shown here) is mostly composed of mature to old
and 5 aircraft, and a total of 4,445 aircraft (94% fleet types that will be retired in a near future, and
of MCTG total fleet). Some popular aircraft types new entrants on the market.

Table 3: Aircraft Aircraft Airlines Avg Age Utilization FH/AC FC/AC FH/FC Dispatch
Operational Data Category Reliability
by Aircraft Category
(FY2018 — 54 Airlines) NB 2,649 A/C 50 8.9 8.5 3,089 1,642 1.9 98.56%

WB2 1,484 A/C 37 8.8 10.6 3,856 781 4.9 98.74%

RJ 225 A/C 13 7.5 6.9 2,529 2,048 1.2 98.81%

WB3+ 182 A/C 7 8.8 11.5 4,215 655 6.4 97.89%

TP 176 A/C 13 7.8 4.8 1,747 1,939 0.9 96.96%

20 FY2018 Snapshot
 2.2. Maintenance Cost Analysis

In FY2018, MCTG airlines reported a total of They employed a total of 32,915 mechanics
$19.78B for their Technical Division spend: this is (reported by 36 airlines) and 21,755 OH staff
$16.94B for direct maintenance cost (reported by (reported by 46 airlines).
54 airlines) and $2.85B for overhead (reported by
Staffing and overhead (OH) are analyzed separately
46 airlines).
in Section 2.2.3.
$16.94B represent almost 24.5% of the world MRO
spend (Fig. 7) for 17% of the world fleet. This may
be explained by the fact that MCTG fleet is skewed
towards higher gauge aircraft (35% WB in MCTG
fleet vs 21% in world fleet).

2.2.1. Direct Maintenance Spend

The 54 MCTG airlines reported $16.94B for per flight hour, $2,634 per flight cycle and $3.6M
their direct maintenance costs, the average per aircraft.
maintenance cost was $314M per airline, $1,089

Table 4: Minimum Average Maximum

Direct Maintenance
Cost - Unit Costs
(FY2018 — 54 Airlines) Aircraft/Airline 1 87 600+

Cost/Airline $1.1M $314M $1,660M

Cost/Flight Hour $43 $1,089 $9,882

Cost/Flight Cycle $91 $2,634 $44,573

Cost/Aircraft $0,0M $3.6M $15.7M

Abnormal values are the result of periodic maintenance effects, exceptional low utilization, redelivery costs, etc.

Fig. 15:
Evolution of Direct
Maintenance Cost BASE
BASE
Structure by Segment 15% 14%
(FY2014 & FY2018)

ENGINE
ENGINE
41%
LINE 47%
LINE 17%
21%

COMPONENT
COMPONENT
COMPONENT 23%
22%
23%
2014 2018
$15.48B $16.94B
(51 Airlines) (54 Airlines)

Engine and components remain the highest cost segments with respectively 47% and 22% of maintenance
costs (Fig. 15).

For more information on Component Maintenance Cost Management go to the download section on the
MCTG webpage.

FY2018 Snapshot 21
Fig. 16:
Evolution of Direct LLP $ LLP $
3% 5%
Maintenance Cost
Structure by Element
(FY2014 & FY2018)

MATERIAL $ MATERIAL $
14% 10%

LABOR $
12%
LABOR $
16% SUBC $
67%
SUBC $
73%

2014 2018
$15.48B $16.94B
(51 Airlines) (54 Airlines)

Important note: For the third year, airlines were Contract maintenance (indicated as ‘SubC’
asked to report the LLP costs in a separate field, for subcontracted) represented 73% of total
and we included them in the calculation of Engine direct maintenance spend (Fig. 16); two airlines
Mtc costs. However, not all of them were able subcontracted all their maintenance activities (Fig 17).
to isolate the costs and reported them either in
As shown in Figure 18, the majority of airlines
their Material costs or subcontracted costs. We
continue subcontract the entirety of their engine
recommend exercising caution when interpreting
work. 0% mostly reflects the absence of any engine
this data, especially the share of LLPs.
overhaul for FY2018.

The rest of this report is only available to participating airlines.

If your airline would to participate in the next maintenance cost

data collection, please contact us at [email protected].

22 FY2018 Snapshot
International Air Transport Association
Maintenance Cost Technical Group
[email protected]

www.iata.org/mctg