Falling revenue over the past five years has
resulted in greater consolidation among
companies, strong competition and falling
industry participation. The total number of
industry establishments has decreased at an
average annual rate of 1.5% to an estimated
8,758 during the five years to 2013.
The industry has a low level of market share
concentration. As a result, competition is high
and there is no one market leader. “The nature
of the industry means that mechanical workers
can own their own company and perform the work
themselves,” says IBISWorld industry analyst
Lauren Setar.
“A high number of nonemployers is another sign
of its competitiveness and demonstrates the
inability for a small number of companies to
control the market.” The industry is maturing,
and larger companies, such as major players
General Electric Aviation, Boeing, General
Dynamics and United Technologies Corporation,
are looking for ways to expand their presence in
the market through nonorganic growth.
Falling capacity among major airlines, a decline
in the number of active aircraft and hours flown
and a drop in recent aircraft accidents have
resulted in less demand for Aircraft
Maintenance, Repair and Overhaul industry
services. “Additionally, as the total trade
value decreases, producers demand less air
transportation and, therefore, less MRO
services,” adds Setar. Overall, IBISWorld
estimates the recession's effects caused revenue
to grow at an average annual rate of just 0.1%
over the five years to 2013.
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