Aviation services provider AAR has announced a major corporate restructuring set to begin in the fourth quarter of 2026. The firm will reorganize into four distinct operating segments: Parts Supply, Repair Engineering and Software, Government Solutions, and a newly defined Legacy Commercial Programs segment.
The company plans to wind down the Legacy Commercial Programs division, which historically focused on asset-heavy, flight-hour-based component repair contracts. According to AAR leadership, this move is designed to improve capital efficiency. CEO John M. Holmes stated that these legacy programs no longer align with the company’s required return thresholds, necessitating a shift toward a more simplified business model.
For operators currently holding these contracts, the wind-down process is expected to span three to four years. While the transition will see AAR divest the assets supporting these programs, the company expects to redeploy its current workforce to other internal growth initiatives. This strategic pivot highlights a broader industry shift where MRO providers are increasingly prioritizing specialized services and software solutions over capital-intensive, hardware-reliant repair agreements to drive margin expansion.