Aircraft maintenance contracts under review by regulators

European regulators are investigating whether airlines are being forced to enter anti-competitive contracts to keep their 24,000 aircraft flying, as equipment makers seek a slice of the $60 billion a year maintenance market.

The European Commission has written to airlines and aircraft component manufacturers, asking for information about the provisions being written into service contracts – terms that could restrict choice when servicing everything from engines to wifi networks.

“They are looking at the third parties that manufacturers licence for maintenance and at the data and information they share with those third parties,” said one airline, which recently received a detailed questionnaire from Brussels and preferred to remain anonymous.

News of the inquiry comes as the airline industry shells out record sums for next-generation passenger and cargo aircraft, to help meet soaring global demand for air travel. Over the next 10 years, the global fleet is expected to grow from 23,927 in 2015 to more than 34,000.

Willie Walsh, chief executive of airline group IAG, this summer warned of possible legal action after expressing concern that limited competition might be keeping prices for aircraft, engines and maintenance services high.

– (Copyright The Financial Times Limited)