MRO & Manufacturing
HAECO Xiamen Expands Facility to Meet Aviation MRO Demand
HAECO Xiamen is expanding its facility to enhance next-gen engine MRO capacity and sustainability by 2026 amid global aviation maintenance challenges.
HAECO Engine Services Xiamen’s announcement of a new facility expansion represents a strategic response to the global aviation maintenance, repair, and overhaul industry’s mounting capacity constraints. The new 10,015 square meter facility, set for completion by the fourth quarter of 2026, will significantly enhance HAECO’s capability to service next-generation engines including the GE9X, GP7200, and CF34-10A, positioning the company to capitalize on unprecedented demand in the aircraft engine MRO sector. This expansion occurs against a backdrop of industry-wide capacity shortages that have pushed engine shop turnaround times up by 35% for legacy engines and over 150% for new generation engines compared to pre-pandemic levels. The facility represents HAECO’s commitment to addressing critical supply chain bottlenecks while advancing sustainable aviation practices through energy-efficient design and solar power integration.
The significance of this development is underscored by the broader industry context. The MRO sector has become a pivotal component of the aviation value chain, especially as airlines struggle with deferred maintenance, supply chain disruptions, and the accelerated introduction of new engine technologies. HAECO’s expansion is not only a response to immediate operational challenges but also a forward-looking investment in technological capability, sustainability, and market leadership in the Asia-Pacific region and beyond.
This article explores the strategic, operational, and technological implications of HAECO’s Xiamen facility expansion, examining its impact on the company’s competitive position, the global MRO industry, and the evolving landscape of aviation maintenance services.
The Hong Kong Aircraft Engineering Company Limited (HAECO) is one of the world’s most established aircraft engineering and maintenance organizations, with a heritage spanning over seven decades since its founding in 1950. Originally created through the merger of PAMAS and JAMCo, HAECO has grown from its Hong Kong base to become a global MRO powerhouse. Its trajectory has been marked by a steadfast commitment to safety, quality, and operational excellence, which has underpinned its reputation and market position for 75 years.
HAECO’s international expansion began in the 1990s, a decade that saw the formation of key joint ventures such as TAECO in Xiamen (now HAECO Xiamen) and the HAESL engine facility in Hong Kong. The opening of a state-of-the-art facility at Hong Kong International Airport in 1998 was a major milestone, further cementing its status as a leading MRO provider. Over the subsequent decades, HAECO broadened its operational footprint to include facilities in Singapore, Bahrain, and across mainland China, as well as the acquisition of TIMCO Aviation Services in the United States in 2014. In 2018, HAECO became a wholly owned subsidiary of Swire Pacific, strengthening its integration into the Swire Group’s aviation portfolio.
Today, HAECO operates 16 companies with a workforce of approximately 16,000 staff across Hong Kong, mainland China, Europe, and the Americas. The group serves over 400 customers from 27 locations worldwide, supported by more than 4,000 suppliers. Its comprehensive service offerings span airframe and line maintenance, component overhaul, engine support, parts manufacturing, and technical training. Even during the turbulence of the COVID-19 pandemic, HAECO continued to invest in new capabilities, such as digitalization and sustainability initiatives, positioning itself for post-pandemic opportunities and continued growth.
HAECO’s Xiamen operations, established in 2008, have become a cornerstone of its Asian strategy. Initially focused on GE90 engine overhaul and testing, the facility quickly earned recognition as a licensed GE90 Service Provider and secured a GE Branded Service Agreement (GBSA) for the Asia region. The addition of a Phase 2 building in 2011 reflected HAECO’s long-term commitment to Xiamen as a critical aviation maintenance hub.
Xiamen has developed into one of China’s most established aviation maintenance centers, attracting leading MRO enterprises and fostering a comprehensive ecosystem for aircraft structural overhauls, engine and landing gear maintenance, and technical training. In the first half of 2025, HAECO Xiamen completed projects for airlines from 14 countries and regions, with maintenance hangars operating at full capacity and 110 inbound aircraft supervised by Xiamen Customs. The value of bonded aviation maintenance operations increased by 29.4% year-on-year, reaching 98.05 billion yuan ($13.68 billion). Innovative regulatory measures have played a key role in this success. Xiamen Customs pioneered China’s first “bonded maintenance outside comprehensive bonded zones” pilot, enabling guarantee-free operations and tax rebates for MRO enterprises. Furthermore, an “integrated aviation maintenance supervision” model has helped reduce aircraft ground time by one to two days and cut customs clearance time by over 25%. These improvements have enhanced Xiamen’s competitiveness as a destination for international maintenance contracts.
“The operational efficiency of HAECO Xiamen has been further enhanced by innovative regulatory and customs procedures implemented specifically to support the aviation MRO industry.”
Construction of HAECO Engine Services Xiamen’s new facility began in August 2025, adjacent to the existing Phase 2 building. The new facility covers 4,420 square meters of ground and offers a total floor area of 10,015 square meters across two levels. This expansion is designed to relieve current capacity constraints and accommodate growing demand for advanced engine maintenance services.
Crucially, the new facility will enable HAECO to service additional engine types, including the Engine Alliance GP7200, GE CF34-10A, and the next-generation GE9X. This strategic move positions HAECO to support the Comac C909 regional airliner and Boeing 777-9, both of which use these advanced engines. The facility will also provide expanded space for maintenance and storage, supporting scaled-up operations and improved workflow efficiency.
Sustainability is a core feature of the facility’s design, with energy-efficient LED lighting and solar panels integrated to reduce environmental impact. This aligns with broader industry trends and regulatory requirements for sustainable operations. According to HAECO executives, the new facility exemplifies the company’s commitment to innovation, customer service, and environmental responsibility.
“The new facility will enhance capacity while enabling the development of capabilities for both current and next-generation engines,” Simon Smith, Director and General Manager, HAECO Engine Services Xiamen
The global MRO industry is experiencing unprecedented demand pressures, with turnaround times for engine maintenance rising sharply. Bain & Company reports a 35% increase for legacy engines and over 150% for new generation engines compared to pre-pandemic levels. Deferred maintenance during the pandemic, supply chain disruptions, and unexpected repair needs for new engine types have all contributed to this capacity crunch.
Supply chain issues, particularly shortages of spare parts, have extended shop visits and increased operational complexity. Airlines are delaying the retirement of older fleets, further straining MRO resources. The availability of used serviceable materials (USM) has also declined, affecting cost structures and maintenance options for operators.
Industry forecasts suggest that MRO demand will peak in 2026 and remain constrained through the decade. Bain & Company projects that, without significant capacity additions, demand for engine shop visits will exceed supply by more than 17% by the end of the 2020s. This imbalance could limit air traffic growth and create broader economic implications for the aviation sector.
China’s aircraft MRO market is one of the fastest-growing globally. According to Grand View Research, it generated over $10.7 billion in revenue in 2023 and is projected to reach $15.6 billion by 2030, with a compound annual growth rate of 5.6%. Engine overhaul services are the largest revenue segment, and modification services are the fastest-growing. Regulatory innovations in Xiamen, such as bonded maintenance outside comprehensive zones and streamlined customs procedures, have made the city a preferred hub for international maintenance contracts. Over 80% of aviation maintenance orders in Xiamen come from overseas clients, underscoring its global reach.
China’s share of the global MRO market stands at 12.6% by revenue as of 2023. The country’s ability to attract international business and its focus on next-generation engine technologies align with HAECO’s expansion strategy, positioning the company to benefit from regional and global growth trends.
HAECO has demonstrated robust financial performance, with recurring profit reaching HK$672 million in 2024, up from HK$465 million in 2023. Growth was driven by increased demand for engine overhaul services and base maintenance, as well as improved performance across component business segments.
The Xiamen facility has been a key contributor, recognized as ‘Asia MRO of the Year – Engine’ in 2024. Long-term agreements with GE Aerospace, including the extension of the GBSA and Offload Agreement through 2040, provide revenue stability and strategic value.
These investments reflect HAECO’s commitment to capturing market opportunities while addressing capacity constraints. The company’s ability to expand facilities while maintaining strong financial health underscores effective capital allocation and long-term strategic planning.
Next-generation engines like the GE9X present both opportunities and challenges for MRO providers. GE Aerospace has invested over $1.5 billion in developing ceramic matrix composite (CMC) materials and over $1 billion in MRO infrastructure for the GE9X. The complexity of these engines demands specialized maintenance capabilities and significant capital investment.
The Boeing 777X program, powered by the GE9X, has faced delays, with first deliveries now expected in 2027 or later. This affects the timing of demand for GE9X MRO services but also allows providers like HAECO more time to prepare and invest in the required infrastructure and training.
Technological advances in digitalization, AI, and predictive maintenance are transforming MRO operations. These innovations improve inspection accuracy, reduce downtime, and enhance operational efficiency, helping providers manage capacity constraints and improve service quality. “The integration of energy-efficient LED lighting and solar panels in the new Xiamen facility reflects HAECO’s commitment to environmental responsibility and industry sustainability trends.”
HAECO is among the world’s leading MRO providers, competing with companies such as ST Engineering Aerospace, Lufthansa Technik, and Air France Industries KLM Engineering & Maintenance. Its extensive network, technical expertise, and long-term agreements with engine manufacturers provide competitive advantages in a crowded market.
The company’s recognition for operational excellence and customer satisfaction, such as the ‘Asia MRO of the Year – Engine’ award, strengthens its market position. Strategic partnerships and a focus on next-generation engine capabilities ensure HAECO remains at the forefront of industry developments.
Emerging competitors are leveraging digital technologies and forming alliances with OEMs and airlines. HAECO’s ongoing investments in innovation, sustainability, and workforce development are critical to maintaining its leadership in the evolving MRO landscape.
HAECO Engine Services Xiamen’s facility expansion is a timely and strategic response to the global MRO industry’s capacity challenges and technological evolution. The new facility, scheduled for completion in Q4 2026, will enable HAECO to meet growing demand for next-generation engine services while advancing sustainability and operational excellence.
With robust financial performance, a strong competitive position, and a forward-looking investment strategy, HAECO is well-placed to capitalize on future growth opportunities in the aviation maintenance sector. The Xiamen expansion exemplifies the proactive investments required to navigate an increasingly complex and demanding industry environment.
What is the significance of HAECO’s new Xiamen facility? Which engine types will the new facility support? How does HAECO’s expansion align with industry trends? What makes Xiamen a strategic hub for aviation maintenance? How is HAECO addressing environmental sustainability? Sources: HAECO Press Release
HAECO Xiamen Engine Services Expansion: Strategic Response to Global Aviation MRO Capacity Crisis
HAECO Group: Seven Decades of Aviation Excellence
Xiamen Operations: A Strategic Asian Hub
The New Facility: Expanding Capabilities for Next-Generation Engines
Global MRO Market Dynamics and Capacity Constraints
China’s Strategic Position in Global Aviation MRO
HAECO’s Financial Performance and Strategic Positioning
Industry Technology Trends and Next-Generation Engine Challenges
Competitive Landscape and Market Position
Conclusion
FAQ
The new facility will expand HAECO’s capacity to service next-generation engines, address industry capacity constraints, and support sustainable operations through energy-efficient design.
The facility will accommodate overhaul and maintenance for Engine Alliance GP7200, GE CF34-10A, and GE9X engines.
The expansion addresses rising demand for MRO services, supports advanced engine technologies, and incorporates sustainability features in line with regulatory and market expectations.
Xiamen offers innovative regulatory support, efficient customs procedures, and a strong ecosystem for international aviation maintenance, making it a preferred location for global MRO contracts.
The new facility integrates LED lighting and solar panels, reflecting HAECO’s commitment to reducing environmental impact and meeting evolving sustainability standards.
Photo Credit: HAECO
MRO & Manufacturing
GA Telesis Expands Asia-Pacific Reach with South Korean Approval
GA Telesis Engine Services secures South Korean MOLIT certification to offer engine overhaul services and signs new deal with MIAT Mongolian Airlines.
This article is based on an official press release from GA Telesis.
GA Telesis Engine Services (GATES), the Helsinki-based engine maintenance subsidiary of GA Telesis, has announced a major expansion of its operational capabilities in the Asia-Pacific region. According to an official company press release, GATES has received Approved Maintenance Organization (AMO) certification from South Korea’s Ministry of Land, Infrastructure, and Transport (MOLIT). This certification authorizes the facility to perform full overhaul services on specific engine models for South Korean airlines.
In a simultaneous development, the company confirmed a new engine maintenance agreement with MIAT Mongolian Airlines. These announcements mark a strategic push by GATES to establish itself as a primary independent alternative to Original Equipment Manufacturer (OEM) facilities in a region heavily reliant on narrowbody aircraft.
The newly acquired MOLIT approval is a critical regulatory milestone for GATES. Under South Korea’s Aviation Safety Act, foreign repair stations must undergo a rigorous audit of their quality control systems and technical procedures before they are permitted to release South Korean-registered aircraft to service. By securing this certification, GATES can now bid directly for heavy maintenance contracts with South Korean carriers without requiring third-party approvals.
According to the press release, the MOLIT approval covers full overhaul authority for three major engine types:
This scope is particularly significant given the composition of the South Korean commercial fleet. Market data indicates that the CFM56-7B is the primary engine for the country’s low-cost carriers (LCCs), including Jeju Air, T’way Air, and Jin Air, which operate substantial fleets of Boeing 737-800 aircraft. Additionally, the CF6-80C2 remains in service with major carriers like Asiana Airlines and Korean Air for their widebody operations.
“This approval allows us to bring our world-class engine maintenance solutions directly to South Korean airlines, offering them a competitive alternative for their fleet requirements.”
, Statement from GA Telesis Press Release
Alongside the regulatory news, GATES announced a definitive agreement with MIAT Mongolian Airlines for the maintenance of its CFM56-7B engines. MIAT, the national flag carrier of Mongolia, operates a fleet centered around the Boeing 737-800. This contract underscores the technical capabilities of the Helsinki facility and provides MIAT with a maintenance partner located strategically between its Asian and European route networks.
The agreement validates GATES’ strategy of targeting operators who require flexible, cost-effective maintenance solutions outside of the traditional OEM network. By utilizing the Helsinki facility, MIAT gains access to a European Aviation Safety Agency (EASA) environment while maintaining logistical efficiency for its fleet. The Rise of Independent MROs in Asia
The entry of GATES into the South Korean market represents a shift in the regional Maintenance, Repair, and Overhaul (MRO) landscape. Historically, South Korean airlines have relied heavily on OEM-affiliated shops, such as the Korean Air Tech Center, or major regional players like ST Engineering. These relationships often come with rigid pricing structures and capacity constraints.
As an independent provider, GATES is positioned to compete on turnaround time (TAT) and workscope flexibility. For LCCs operating on tight margins, the ability to perform targeted repairs, rather than mandatory full overhauls, can result in significant cost savings. The “hospital shop” concept, which focuses on surgical repairs to return engines to service quickly, is likely to appeal to carriers like T’way Air and Jeju Air as their fleets age and maintenance events become more frequent.
Furthermore, the timing of the MOLIT approval coincides with a high demand for CFM56 shop visits globally. As supply chain issues continue to plague the new engine market (LEAP and GTF), airlines are holding onto older aircraft longer, increasing the need for reliable maintenance capacity for legacy engines like the CFM56 and CF6.
The GATES facility is located at Helsinki-Vantaa Airport in Finland. According to company data, the site spans 180,000 square feet and features an integrated test cell capable of handling engines with up to 100,000 lbs of thrust. The facility has an annual capacity of approximately 200 engines.
With the addition of the South Korean MOLIT certification, GATES now holds approvals from major global regulators, including:
This broad regulatory portfolio allows the company to serve a diverse customer base across Europe, Asia, and the Americas, reinforcing its status as a premier independent engine maintenance provider.
GA Telesis Engine Services Secures South Korean Regulatory Approval, Expands APAC Footprint
Breaking Barriers in the South Korean Market
Authorized Engine Types
Strategic Partnership with MIAT Mongolian Airlines
AirPro News Analysis
Facility Capabilities and Global Reach
Sources
Photo Credit: GA Telesis
MRO & Manufacturing
ITP Aero to Acquire Aero Norway, Expanding CFM56 MRO Services
ITP Aero signs agreement to acquire Aero Norway, enhancing aftermarket capabilities for CFM56 engines and expanding its European MRO presence.
ITP Aero, a global leader in aerospace propulsion, has signed a binding agreement to acquire Aero Norway, a specialized maintenance, repair, and overhaul (MRO) provider focused on CFM56 engines. According to the company’s official announcement, the transaction is expected to close during the first half of 2026, subject to customary regulatory approvals.
The acquisition represents a significant expansion of ITP Aero’s aftermarket capabilities. By integrating Aero Norway’s facility in Stavanger, Norway, ITP Aero aims to reinforce its status as a leading independent player in the aerospace services sector. The move follows a trajectory of aggressive growth for the Spanish propulsion company since its acquisition by Bain Capital in 22.
Aero Norway operates out of a facility at Sola Airport in Stavanger, employing a workforce of over 200 skilled technicians. The company has established a reputation for high-quality engine maintenance, specifically for the CFM56 engine family, serving a global client base of airlines, lessors, and asset managers.
In its press statement, ITP Aero highlighted that the two companies possess “highly complementary strengths.” The deal combines Aero Norway’s deep expertise in engine overhaul with ITP Aero’s existing engineering capabilities and component repair infrastructure. This synergy is designed to offer a more comprehensive suite of services to the aftermarket sector.
This agreement is the latest in a series of strategic moves by ITP Aero. In 2023, the company acquired BP Aero in the United States and was recently selected to join Pratt & Whitney’s GTF MRO network. These steps are part of a broader “2030 Strategic Plan” which aims to double the size of the business and increase the global workforce by 50% by the end of the decade.
While the press release focuses on corporate synergies, the acquisition underscores a critical trend in the current aviation landscape: the extended dominance of the CFM56 engine. As new-generation engines like the LEAP and GTF face supply chain delays and durability challenges, airlines are keeping older aircraft powered by CFM56 engines in service longer than originally planned.
Industry data suggests that approximately 20,000 CFM56 engines will remain in service through 2025. Consequently, the demand for maintenance shop visits is projected to peak between 2025 and 2027. By acquiring a specialist shop like Aero Norway, ITP Aero is effectively positioning itself to capture high-value work during this period of “structural undersupply” in the narrowbody market. This “Golden Tail”, the long, profitable tail end of an engine program’s lifecycle, provides a stable revenue runway for MRO providers capable of handling heavy overhauls. The crossover point where new-generation engine shop visits outnumber CFM56 visits is not expected until later in the decade, making capacity for legacy engines a premium asset today.
Leadership from both organizations emphasized the value of combining their respective technical strengths. Eva Azoulay, CEO of ITP Aero Group, described the agreement as a key component of the company’s roadmap.
“The signing of this binding acquisition agreement marks a significant milestone in our strategic roadmap. This acquisition reinforces our ambition to become a leading independent player in the aerospace aftermarket.”
, Eva Azoulay, CEO of ITP Aero Group
Neil Russell, CEO of Aero Norway, noted that the merger would unlock synergies beneficial to their customer base.
“By combining the complementary strengths of ITP Aero and Aero Norway, we will unlock significant synergies that enhance our competitiveness and deliver even greater value to our customers.”
, Neil Russell, CEO of Aero Norway
ITP Aero reports that it has tripled its earnings since 2022 and is currently implementing a long-term business plan that spans civil, defense, and MRO segments. The company was advised on legal M&A matters regarding this transaction by Baker McKenzie.
Pending regulatory clearance, the integration of Aero Norway into the ITP Aero Group will finalize in 2026, solidifying the company’s footprint in the European MRO market.
Sources:
ITP Aero to Acquire Aero Norway, Strengthening Position in CFM56 Aftermarket
Strategic Expansion in the MRO Sector
AirPro News Analysis: The “Golden Tail” of the CFM56
Executive Commentary
Future Outlook
Photo Credit: ITP Aero
MRO & Manufacturing
AkzoNobel Invests €50 Million to Upgrade US Aerospace Coatings Facilities
AkzoNobel invests €50 million to expand and modernize aerospace coatings production in Illinois and Wisconsin, enhancing capacity and supply chain resilience.
This article is based on an official press release from AkzoNobel.
AkzoNobel has officially announced a significant investments of €50 million (approximately $52–55 million) to modernize and expand its aerospace coatings capabilities in North America. According to the company’s announcement on December 18, 2025, the project will focus on upgrading its flagship manufacturing facility in Waukegan, Illinois, and establishing a new distribution center in Pleasant Prairie, Wisconsin.
This strategic move aims to increase production capacity and shorten lead times for airline and Maintenance, Repair, and Operations (MRO) customers. By enhancing its supply chain infrastructure, AkzoNobel intends to address the growing demand for air travel and the subsequent need for advanced aerospace coatings.
The investment centers on the Waukegan facility, which currently serves as AkzoNobel’s largest aerospace coatings production site globally. The site employs approximately 200 people and houses a dedicated color center. According to the press release, the capital injection will fund the installation of new machinery and automated processes designed to handle larger batch sizes.
To further optimize operations, the company is relocating its warehousing and distribution activities to a new facility in Pleasant Prairie, Wisconsin. This relocation is intended to free up floor space at the Waukegan plant, allowing for a focus on complex, customized chemical manufacturing.
Patrick Bourguignon, Director of AkzoNobel’s Automotive and Specialty Coatings, emphasized the forward-looking nature of the investment:
“This investment will increase our comprehensive North American supply capability and solidify our position as a frontrunner in the aerospace coatings industry. Demand for air travel is expected to grow significantly… and we want to make sure our customers are able to meet that demand.”
A key component of the upgrade is the introduction of a “Rapid Service Unit” dedicated to faster turnaround times for the MRO market. The company states that the new infrastructure will include a “liquid pre-batch area” and “high-speed dissolvers” to accelerate production.
Martijn Arkesteijn, Global Operations Director for AkzoNobel Aerospace Coatings, noted that these improvements are designed to enhance flexibility for customers: “We’ll be able to provide current and future customers with even more flexibility through the delivery of large batch sizes, better responsiveness to market needs and shorter lead time for color development.”
While AkzoNobel’s announcement focuses on internal efficiency, this investment arrives during a period of intensified competition within the North American aerospace sector. Earlier in 2025, rival manufacturer PPG announced a massive $380 million investment to construct a new aerospace coatings plant in Shelby, North Carolina.
In our view, AkzoNobel’s strategy differs significantly from its competitor’s greenfield approach. Rather than building new capacity from scratch, AkzoNobel is executing a targeted upgrade of existing assets. This “efficiency war” suggests that the company is betting on agility and technology upgrades, specifically the ability to deliver custom colors and small batches quickly via its new Rapid Service Unit, rather than simply expanding raw volume output.
The upgraded facilities are also aligned with the aviation industry’s push for decarbonization. AkzoNobel highlighted that the investment supports the production of its “Basecoat/Clearcoat” systems, which are lighter than traditional coatings. Reducing paint weight is a critical factor for airlines seeking to lower fuel consumption and carbon emissions.
Furthermore, the new automated processes are expected to reduce chemical waste and solvent use. The facility upgrades will likely support the increased production of chromate-free primers, meeting stricter regulatory requirements in both the United States and the European Union.
By localizing more storage and production capacity in North America, AkzoNobel also aims to bolster supply chain resilience, addressing vulnerabilities exposed during the post-pandemic aviation recovery.
AkzoNobel Announces €50 Million Upgrade to US Aerospace Coatings Operations
Strategic Expansion in Illinois and Wisconsin
Operational Efficiency and the “Rapid Service Unit”
AirPro News Analysis: The Competitive Landscape
Sustainability and Technology Integration
Sources
Photo Credit: AkzoNobel
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