Analytical Overview of MRO in Central Asia

Recent developments in the Maintenance, Repair, and Overhaul (MRO) sector in Central Asia highlight significant advancements and investments aimed at enhancing aviation infrastructure and capabilities across the region. This overview captures the key elements shaping the MRO landscape.

Growing commercial fleets in the Central Asia and Caspian region is driving demand for MRO services. According to Maksim Koklov, Regional Sales Director, CIS at Lufthansa Technik, “From 2020, more than 10 airlines started operations in the region, and now there are about 40+ carriers. This opens up huge opportunities for the MRO sector, but there are many challenges for MROs in the region."

Mario Antonio Ebcim, Sales Director, Eurasia, Boeing Commercial Airplanes believes “…that the Central Asia region has huge growth potential and that fleet modernization is very important. Departures from Central Asia in 2023 are 37% higher than in 2019. Central Asia is also very important to connect the huge Indian market with the US."

According to Lufthansa Consulting estimates, the region has a noteworthy base maintenance capability gap when compared to international benchmarks.

Existing aftermarket service providers are expanding their capacity and capabilities to meet the market, while new suppliers and investors move into the region.

1. Expansion of MRO Facilities

1. Uzbekistan Airways Technics (UAT)

The national airline of Uzbekistan has made significant strides in expanding its aircraft maintenance capabilities through its subsidiary Uzbekistan Airways Technics (UAT). In 2023, UAT conducted 27 heavy maintenance C-Checks and 128 of A-Checks. It expects some 20% increase of its activity this year.

Location: Tashkent, Uzbekistan.
Initiatives: UAT is actively expanding its capabilities, including the construction of new hangars and the modernization of equipment to service a broader range of aircraft types. The plan includes building two widebody aircraft hangars, significantly improving their ability to handle aircraft like the Boeing 787 and Airbus A330, according to UAT CEO Umid Husanov. Another new type for UAT will be the Boeing 737MAX. According to Khusanov, the company has already found partners to master the maintenance of these airplanes.

Key developments include
  • Expansion of MRO facilities with new hangars and advanced equipment to handle a broader range of aircraft types.
  • Long-standing partnership with Lufthansa Technik spanning 30 years, enabling knowledge transfer and training of local technicians to international standards.
  • Ability to perform complex maintenance tasks like C-Checks on Airbus and Boeing aircraft, reducing reliance on external MRO providers.
  • Plans to further expand its maintenance network and position Uzbekistan as a regional MRO hub.
2. Air Astana
Air Astana, the leading airline of Kazakhstan, has been actively developing in-house aircraft maintenance capabilities.

Location: Almaty and Astana, Kazakhstan.
Initiatives: Air Astana is developing in-house maintenance capabilities, including plans for new hangars to accommodate their growing fleet, particularly the Boeing 787, expected in 2025. These expansions aim to reduce reliance on foreign MRO services and enhance local maintenance capabilities. Robert Dando, Senior Manager of Maintenance at Kazakhstan’s Air Astana, says: "Our future plans for MRO are Boeing 787 composite workshops and new hangars".

Key developments include
  • Obtained European Aviation Safety Agency (EASA) Part 145 approval to maintain its fleet according to EASA requirements, demonstrating adherence to international standards.
  • Recognized with the MRO Russia & CIS Award in 2020 for achievements in aircraft maintenance in Central Asia.
  • Investing in building technical expertise and infrastructure to reduce reliance on foreign MRO services.
Air Astana became the first airline in Kazakhstan that is able to independently perform heavy maintenance C1 and C2 checks on Airbus family aircraft at its engineering bases in Almaty and Astana in 2019.
3. Emerging carriers are thinking about developing in-house maintenance capabilities:
  • Uzbekistan first private airline, Qanot Sharq, has already started performing its own line maintenance.
  • Uzbek startup, My Freighter group, opens its first line maintenance station this year, said Gennady Kharlap, the company’s technical advisor. Currently, the privately-owned group, comprising a passenger airline Centrum Air in addition to its dedicated cargo division My Freighter, contracts Uzbekistan Airways Technics to perform line and basic maintenance of its fleet of eight aircraft. According to Kharlap, the company will start line maintenance with Airbus A320, which Centrum Air operates. The second type will be Boeing 767Fs, which are the core of My Freighter fleet. The next step will be to open its own basic maintenance station. But that will happen when the company is ready for it, Harlap explained. "There are no exact dates yet," he emphasized.
  • Cargo operator Fly Khiva, another Uzbek newcomer plans for in-house line maintenance.

2. Technological Advancements

MRO providers in the region are adopting digital tools and automated systems to improve efficiency and reduce turnaround times. Predictive maintenance technologies leveraging data analytics are being implemented to anticipate and address maintenance needs preemptively. For instance, UAT plans to introduce Swiss-made AMOS MRO software in 2024 to streamline maintenance processes. MRO optimization strategies, such as sourcing strategies, process redesign, and IT solutions, are being implemented to improve reliability and reduce costs.
International Collaborations
  • Lufthansa Technik: This long-standing partnership with Uzbekistan Airways Technics spans 30 years, focusing on knowledge transfer and training local technicians to international standards. Since Uzbekistan Airways added its first Western-built aircraft, Airbus A310−300, to its fleet in 1993, Lufthansa Technik (LHT) has continuously supported Uzbekistan Airways with reliable technical and engineering services. While the airline outsourced almost all technical support services to its external partner LHT at the beginning of the cooperation, it has gained increasing experience — from aircraft maintenance to engineering services and aircraft overhauls. In this context, Lufthansa Technik actively supported Uzbekistan Airways in the build-up of technical knowhow. The training helped the airline’s staff to obtain international certification and take over line and base maintenance as well as engineering support for their fleets up to the performance of C-Checks.LHT continues to provide a wide array of services for Uzbekistan Airways, including component maintenance and access to the spare parts pool for their entire Airbus and Boeing fleet, services for landing gears as well as for engines if required. Parallel to this, Lufthansa Technik has assisted Uzbekistan Airways in establishing and expanding maintenance capacities for its own and regional third-party customers.
  • EU Wings: Italy’s EU Wings has agreed to perform aircraft line maintenance at six airports in Uzbekistan, but has not yet committed to set up a joint venture for base MRO at Navoi Airport. Uzbekistan Airports and EU Wings signed a cooperation agreement under which the Italian provider will perform line maintenance of aircraft at Tashkent, Bukhara, Navoi, Urgench, Namangan and Fergana airports. The types to be served include Airbus A319, A320, A321, A330, Boeing 737, 767, 777, 787, Embraer RJ 170/190 and ATR 42/72. The cooperation between the companies began in March, when they signed a memorandum of understanding at the regional trade event MRO Central Asia 2024 to explore the creation of a joint center for basе aircraft maintenance at Navoi airport. It was planned that the JV would service aircraft for both Uzbek carriers as well as foreign airlines. The partners intended to build a hangar in Navoi. In May, a visit to Navoi airport was organized for the potential partner "to familiarize with the possibilities of the strategic transport hub and conditions for the establishment of such an enterprise," Uzbekistan Airports reported earlier. The Italian company has already been providing line maintenance for logistics operator Maersk in Navoi since October 2023. In addition, EU Wings provides line maintenance for Silk Avia, Fly Khiva and Titan Airways in Tashkent and Air Samarkand in Samarkand.
These steps "create favorable conditions for attracting new foreign air carriers to the airports of Uzbekistan, as well as provide an opportunity to organize additional jobs", according to Uzbekistan Airports.

3. Technological and Expertise Exchange

These collaborations bring expertise, technology, and best practices from established global MRO providers to the region, aiding in the upgrade of local service offerings to meet international standards.
Training and Workforce Development
A major focus is on training and certifying local technicians to meet the growing demand for skilled labor. Partnerships with aviation academies and international certification bodies are ensuring that the workforce is equipped with the latest skills and knowledge. UAT's partnership with Lufthansa Technik exemplifies this effort, facilitating the training of local technicians to international standards.

in March, during the meeting between the leaders of Turkmenistan and Turkey, a memorandum of understanding was signed between Turkmenistan Airlines and the University of Turkish Aeronautical Association. The details of the agreement are not known, apart form the fact that the memorandum was concluded as part of "the implementation of national programs aimed at <...> deep modernization of the material and technical base of the [Turkmenistan] transport system”.

In June the Aviation Administration of Kazakhstan (AAK) and JAA Training Organisation (JAA TO), a Dutch non-profit organisation and the Associated Body of the European Civil Aviation Conference (ECAC), announced the signing of a three-year Training Service Agreement (TSA).

Under the terms of the agreement, JAA TO will provide comprehensive training services to the AAK, focusing on enhancing the skills, knowledge and competencies of the country's aviation professionals. The training programs will cover a range of topics, including aviation safety, aircraft maintenance, aviation auditing and regulation.
Regulatory Enhancements
Central Asian countries are aligning their regulatory frameworks with international aviation standards, such as those set by the European Union Aviation Safety Agency (EASA) and the Federal Aviation Administration (FAA). This alignment is critical for gaining the trust of international airlines and expanding the market for MRO services in the region.

An important step for the UAT will be obtaining FAA certification this year, in addition to the existing approvals of 15 other aviation authorities. According to UAT CEO Umid Khusanov, the certificate of the U.S. Federal Aviation Administration was a requirement of some potential customers, so the company decided to obtain it.

In early March, Aviation Administration of Kazakhstan (AAK) has successfully passed a certification to have developed and implemented a Quality Management System (QMS) as per the ISO 9001 standards.
The introduction of a QMS made it possible to optimize and unify the main organizational processes (Efficiency in Business Operations), such as planning and implementation of technical oversight and control, drafting regulations, and resource provision processes, AAK says.

The ISO certificate conforms with the compliance of operational processes, services, and documentation with the requirements of ISO 9001 national standard to conduct the following scope of activity:
  • participation in the development of draft regulations in the field of civil aviation;
  • provision of public services for certification of individuals and legal entities operating in the field of civil aviation;
  • technical oversight and surveillance of aviation safety and security;
  • international cooperation with aviation authorities of foreign countries and specialized international organizations on issues of aviation safety and security.
In addition, certification will facilitate the implementation of a system for managing risks and realizing opportunities related to the AAK's area of activity and its objectives.

As a result of successful QMS certification and in the conditions of constant maintenance of compliance with the ST RK ISO 9001-2016 standard, a reduction in the level of reputational risks and an increase in the aviation regulator’s brand value at Central Asia region as a reliable partner, are expected.

4. Key Challenges

  1. Skilled Labor Shortage: There is a notable shortage of trained technicians and engineers in the region, posing challenges for MRO providers. Access to skilled labor is unanimously seen as the primary challenge for MRO providers operating in Central Asia. There is a shortage of trained technicians and engineers with the right skills to perform maintenance tasks, making it difficult for MRO companies to find and retain qualified personnel.
  2. Infrastructure and Capability Gaps: The region significantly lags behind international standards in base maintenance capabilities, necessitating investments in local MRO infrastructure. The Central Asian region has a notable gap in base maintenance capabilities compared to international benchmarks. There is a lack of established MRO facilities and service centers authorized by aircraft manufacturers, posing challenges for international providers looking to expand their operations in the region.
  3. Supply Chain and Logistics Issues: Extended lead times for spare parts and materials, coupled with logistical challenges due to the geographic location, impact the efficiency of MRO operations. MRO providers in Central Asia face supply chain challenges, including extended lead times for spare parts and materials, as well as logistics issues related to the region's geographic location. The ongoing conflict between Russia and Ukraine has further exacerbated these challenges, impacting the availability of raw materials like steel and titanium for OEMs.
  4. Regulatory Compliance and Certification: International MRO providers must ensure compliance with local aviation regulations and obtain necessary certifications from aviation authorities in Central Asian countries. International MRO providers must ensure compliance with local aviation regulations and obtain necessary certifications from aviation authorities in Central Asian countries. This process can be lengthy and complex, posing challenges for companies seeking to establish operations in the region.
  5. Increasing Competition: As demand for MRO services in Central Asia grows but remains partly unsatisfied, competition is intensifying between international providers and local and regional players, who are expanding their capabilities.
  6. Geopolitical and Economic Factors: The Central Asian region is influenced by geopolitical tensions and economic factors, such as inflation and currency fluctuations, which can impact the operations and profitability of international MRO providers.

5. Notable Achievements

  • Increased Capacity: The expansion of MRO facilities has significantly increased the capacity to handle more aircraft and a wider variety of maintenance tasks, from routine checks to complex overhauls.
  • Enhanced Service Quality: The adoption of advanced technologies and international best practices has led to improvements in service quality, reducing aircraft downtime and enhancing safety.
Economic Impact and Future Prospects
The growth of the MRO sector contributes to the economic development of the region by creating jobs, attracting foreign investment, and supporting the aviation industry as a whole. The continued expansion of MRO facilities, adoption of advanced technologies, and strategic international collaborations indicate a robust future for the MRO sector in Central Asia.

In summary, the MRO sector in Central Asia is evolving rapidly, with significant investments in infrastructure, technological advancements, and strategic partnerships driving growth. These developments are positioning the region as an emerging hub for aircraft maintenance and overhaul services, adhering to international standards and addressing local challenges.