Rolls-Royce grew its footprint in China last year by establishing an engine MRO joint venture with Air China.
Equities analyst Jefferies has said it is “warm to aftermarket momentum” after upgrading its view of Rolls-Royce.
The British engine manufacturer has endured a torrid few years, but Jefferies believes that improving widebody flying hours and China’s reopening represent significant positives for the company.
Data from Aviation Week Network’s 2023 Commercial Fleet & MRO forecast bears this out, illustrating Rolls-Royce’s strong position in China.
There are almost 600 Rolls-Royce Trent family engines in China, including 150 Trent XWBs for the Airbus A350 and about 380 Trent 700s for the A330.
Those 600 engines represent roughly a 50% market share of widebody engines in China, which compares very favorably to the Trent’s 10% share in the U.S. and even its 40% share in Europe.
Furthermore, Rolls-Royce looks likely to maintain its position in China, with Aviation Week predicting it will deliver 90 new engines to the country over the next five years, versus 86 from rival GE.
Equally important is the large fleet of older Trent 700s in the country, many of which are serviced under the most profitable time and material contracts.
Aviation Week predicts that Chinese airlines will generate about 1,000 Trent 700 overhaul events over the next 10 years, with total maintenance demand for the engine in the country peaking at $1.6 billion in 2027.
For all Trent engines, Chinese MRO demand is forecast to total $13.7 billion from 2023-32, versus $11.6 billion for GE’s widebody engines.
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