Industry Insight Report: Aircraft Engine and Parts Mfers Q2-2026

The aircraft engine and parts manufacturing sector continues to operate in a market defined by strong long-term demand and short-term volatility. While new orders for non-defense aircraft and parts reached $13.9 billion in February 2026, monthly order activity remains uneven as manufacturers, suppliers, and airlines navigate production delays, supply chain bottlenecks, and evolving trade policies. According to Vertical IQ, despite a 42.4% decline from the prior month, orders remained up 24.1% year over year, highlighting continued recovery across the aerospace ecosystem.

Demand Remains Strong Despite Production Challenges

Aircraft manufacturers and suppliers continue to benefit from elevated commercial aviation demand, but production schedules remain inconsistent. Boeing and Airbus suppliers are still working through component shortages, labor constraints, and certification timelines that have limited the industry’s ability to fully capitalize on growing airline demand. Industry analysts continue to point to engines and critical aerospace components as key bottlenecks affecting delivery schedules across the global aviation supply chain.

Recent developments surrounding tariffs and trade policy could provide some relief. The aerospace sector has largely maintained exemptions on many aircraft and aircraft-part imports, helping stabilize costs and improve component availability throughout the supply chain. However, uncertainty surrounding future tariff actions remains a consideration for manufacturers and suppliers planning long-term production investments.

Workforce Growth Signals Industry Confidence

Employment growth continues to reflect confidence in the sector’s long-term outlook. According to Vertical IQ, employment among aircraft engine and engine parts manufacturers increased 5.9% in March compared to a year ago. Over the past decade, industry employment has expanded 26.4%, significantly outpacing overall private employment growth of 11.3%.

Wage growth remains robust as manufacturers compete for skilled labor. Average wages for aerospace products and parts manufacturing employees reached $52.16 per hour in March, up 3.7% year over year. Over the last three years, wages increased 16.1%, exceeding the broader private sector growth rate of 11.7%. For business owners, these trends demonstrate continued investment in workforce development while highlighting the importance of labor retention and operational efficiency.

Industry Forecast Remains Positive

Vertical IQ forecasts sales for U.S. aircraft engine and parts manufacturers to grow at a 4.88% compounded annual rate from 2026 through 2030, outperforming expected overall economic growth. Long-term demand drivers remain intact, including commercial fleet modernization, increased global air travel, military spending, and sustained demand for maintenance, repair, and overhaul services.

Texas remains an important aerospace manufacturing hub, benefiting from its concentration of aerospace suppliers, defense contractors, and skilled manufacturing labor. Businesses with diversified customer bases and specialized capabilities continue to attract significant buyer interest.

Texas M&A and Business Valuation Outlook

From an M&A perspective, buyer demand remains strong for aerospace manufacturers with recurring contracts, FAA certifications, proprietary processes, and diversified revenue streams. Strategic acquirers continue seeking opportunities to strengthen supply chains, while private equity groups remain interested in niche manufacturers serving commercial aviation, defense, and aftermarket repair markets.

We continue to see strong interest from buyers seeking businesses that can demonstrate predictable cash flow, experienced management teams, and the ability to scale production efficiently. For owners considering an eventual exit, current market conditions present an opportunity to begin preparing for a future transaction while industry fundamentals remain favorable.

Looking Ahead

Although aircraft order activity will likely remain uneven throughout 2026, the industry’s long-term trajectory remains positive. Companies that can navigate supply chain challenges, maintain workforce stability, and build operational resilience are likely to remain attractive acquisition targets.

Whether you’re planning to sell your aircraft engine and parts manufacturing business in Texas this year or simply evaluating your options, understanding your current market value is a critical first step.

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• Lion Business Advisors’ quarterly industry insights incorporate data and trends sourced from internal deal flow and buyer activity, Vertical IQ, and market comparables from platforms such as Axial and BVR (Business Valuation Resources).