Navigating the Skies of Change: Aircraft Production Trends and the MRO Squeeze
The commercial aviation sector closes 2025 in a state of complex friction. While passenger demand has surged back to, and in many regions surpassed pre-pandemic levels, the industrial machinery required to support that growth is still misfiring. For airlines and lessors, 2025 has been defined by a widening gap between the aircraft they needed and the aircraft they received.
This imbalance has created a distinct set of operational realities for the year ahead, shifting the centre of gravity from new deliveries to the maintenance of existing fleets.
The 2025 New Aircraft Production Landscape: A Year of Friction
As 2025 concludes, the aircraft production story has been one of ambitious targets meeting stubborn supply chain realities. Both major OEMs faced significant headwinds, though their trajectories differed.
Airbus: Pushing Production Rates
Airbus spent 2025 aggressively ramping up output speed to meet its delivery target of roughly 820 aircraft. The focus remained heavily on the A320neo family, the industry's narrow body aircraft workhorse. By November 2025, production rates for the A320 family had climbed significantly, hitting approximately 67 assembled aircraft per month; a strong signal that the manufacturer is closing in on its medium-term goal of 75 per month by 2027. Despite this progress, the backlog remains daunting, with over 7,000 A320 family jets still in the queue, meaning an airline ordering today would not see a delivery slot for years.
Regarding widebody aircraft models, the A350 programme showed improvement in the final months of 2025, producing eight aircraft in November, above the six-per-month target. However, total A350 output through November averaged only five aircraft per month, underscoring continued production inconsistency. The A330neo maintained steady but modest production at around six units monthly.
Boeing: Stabilizing the Line
Boeing's 2025 was characterized by regulatory constraints and stabilization efforts. Following the FAA's imposition of a production cap earlier in the year, the manufacturer spent much of the period restricted to 38 737 MAX jets per month. While regulators eventually cleared the path to increase this rate to 42 per month in late 2025, actual production has lagged behind approvals. November 2025 data indicates the 737 MAX production was hovering around 32 jets, underscoring the difficulty of restarting a stalled supply chain even when regulatory lights turn green.
On widebodies, the 787 Dreamliner performed more consistently, hitting its target of eight aircraft in November and confirming management's stated goal of ramping to ten per month by 2026. However, the stretched 777X programme continues to face delays, pushing entry into service further into the decade and leaving a gap in the ultra-long-haul market.
For the year as a whole, Boeing is working toward a total of approximately 610 deliveries, a substantial performance improvement over 2024's 348 units, but still far below pre-MAX grounding levels.
The 2026 Outlook: Easing Bottlenecks?
Looking toward 2026, the industry anticipates a slow "un-kinking" of the supply hose, though optimism is tempered by experience.
Supply Chain Normalization
The acute shortages of engines and structural components that plagued 2024 and 2025 are forecast to begin easing in the coming year. Industry consensus suggests that while 2026 will not be problem-free, it will mark the turning point where stability returns to Tier 1 and Tier 2 suppliers. However, geopolitical instability, raw material constraints, and labor availability remain ongoing concerns.
Production Plateaus
While OEMs are desperate to deliver, total annual production is not expected to hit its new equilibrium; around 2,200 aircraft globally until closer to 2028 or 2029. For 2026, this means airlines must continue planning for delivery delays and extended lead times. Some forecasts suggest the industry will not normalize until potentially 2031 or even 2034, given the record backlogs and sustained order intake.
Fleet Strategy Shifts
With backlogs at record highs, reaching 58% of the in-service fleet compared to a historical average of 40%, carriers are rewriting their fleet strategies for the near future. Airlines are prioritizing life-extension programs over fleeting hopes of early delivery slots, and in some cases, are even reactivating retired aircraft to bridge capacity gaps.
The Aging Fleet Reality
One of the most striking consequences of the production bottleneck is the aging of the global commercial fleet. The average age of the world's commercial aircraft has reached 15 years; the oldest in aviation history, compared to 13 years before the pandemic. This aging is driven by deferred retirements as airlines struggle to secure replacement aircraft.
Retirement rates have actually decreased in 2025 compared to 2024, reflecting the limited availability of replacement capacity. While approximately 10,900 retirements are projected over the next decade, the annual rate remains constrained in the near term. Interestingly, a small number of relatively young A320neo and A321neo aircraft (aged 6-8 years) were retired in 2025 for economic reasons related to engine leasing opportunities, highlighting the complexity of current fleet dynamics.
The MRO Squeeze: A Burgeoning Market
The direct consequence of the OEM delivery lag is a boom and a bottleneck in the Maintenance, Repair, and Overhaul (MRO) sector. Because airlines could not retire older jets as planned in 2025, the global fleet is older and flying harder than anticipated, creating additional pressure on supporting systems and operational efficiency
Life Extension is the New Standard
Airlines are holding onto aircraft that were slated for retirement. This has driven a surge in heavy maintenance visits (D-checks) and structural life-extension programs. MRO providers are seeing fully booked slots well into 2026 as carriers scramble to keep aging metal airworthy. The global MRO market is projected to have reached a record $104 billion in 2024 and is expected to grow to $119 billion in 2025, eventually reaching $156 billion by 2035, reflecting a continued rise in demand for long-term maintenance solutions.
Supply chain disruptions are expected to cost airlines more than $11 billion in 2025 alone, largely due to higher fuel costs, increased maintenance expenses, engine leasing costs, and surplus inventory holding costs associated with keeping older aircraft operational.
Supply Chain: The Used Parts Drought
Historically, retiring aircraft provided a steady stream of Used Serviceable Material (USM) to the MRO market. With retirements delayed, fewer aircraft are being dismantled. This has created a scarcity of quality used parts, driving up prices and forcing MROs to rely on more expensive new OEM parts, further increasing maintenance costs. As more current-generation aircraft begin retiring in larger numbers in the coming years, the USM market may see increased supply, though timing remains uncertain and carries important implications for operators maintaining commercial jetliners.
The Engine Shop Crunch
The engine segment remains the most stressed point in the MRO ecosystem and is projected to grow from $30 billion to $49 billion by 2027. New-generation engines (like the LEAP and particularly the Pratt & Whitney GTF) have required more frequent off-wing maintenance than their predecessors due to durability issues in harsh environments. The GTF-related groundings have been particularly severe, with 747 of the 976 single-aisle aircraft in storage as of June 2025 being GTF-powered. Combined with the extended life of legacy engines (CFM56 and V2500), engine shops are operating at capacity, with turnaround times stretching significantly.
The Labour Crisis
Compounding the physical constraints is a deepening labour shortage. The MRO industry is experiencing a significant skills gap, with an aging workforce approaching retirement and an insufficient pipeline of new, skilled technicians. Boeing forecasts a global demand for 716,000 maintenance technicians by 2042, while industry projections suggest a 20% shortfall in maintenance technicians by 2028. The global MRO workforce could face a deficit of over 38,000 technicians by 2027, with the Asia-Pacific region expected to be most heavily impacted.
Many engineers who left the industry during the pandemic have not returned, and younger generations are hesitant to enter the profession due to long qualification timelines, high training costs, and job security concerns. This labour constraint is creating delays, increasing maintenance costs, and putting pressure on existing teams across operators and service providers.
The Widebody Wild Card
While narrowbody production dominates the headlines, the widebody segment presents its own dynamics. Modern, fuel-efficient widebodies like the Boeing 787 and Airbus A350 are in high demand for long-haul flight routes, yet production remains constrained. This scarcity has led to some surprising developments, including the continued operation and in some cases reactivation of the Airbus A380 on high-density routes where slot constraints and premium travel demand justify the aircraft's higher operating costs. These pressures also have revenue and fleet-planning implications for airlines serving global customers.
The delayed arrival of the Boeing 777X has left a gap in the ultra-long-haul market, forcing carriers to extend the service life of existing 777-300ER aircraft and maintain older widebody types longer than planned. Production of the 787 is targeting ten units per month by 2026, though achieving and sustaining this rate will be challenging.
Summary
As the industry moves into 2026, the narrative has shifted from "recovery" to "resilience." The failure of the supply chain to deliver enough new aircraft in 2025 has cemented the MRO sector's role as the linchpin of global aviation capacity. For the near future, the ability of an airline to fly will depend less on the aircraft they ordered, and more on how well they can maintain the aircraft they already have. The convergence of aging fleets, parts scarcity, engine reliability issues, and workforce shortages has created a perfect storm for the MRO industry, one that represents both significant operational risk and substantial commercial opportunities for those positioned to meet the demand.