Three years ago, Rolls-Royce & Partners Finance was leasing an engine for a large narrowbody jet for $120,000 a month. Today, a similar powerplant commands a rate of just $50,000. Underpinning the 58% price cut is a simple equation: supply and demand.
A significant amount of airframe heavy maintenance work soon could be up for grabs in the MRO market.
Air Canada had several lines of overhaul work at Aveos before the MRO provider closed its doors less than a month ago.
In addition, AMR Corp.’s American Airlines previously performed much of its airframe work in-house, but as part of its Chapter 11 bankruptcy reorganization is seeking to close a heavy maintenance facility at Fort Worth Alliance Airport and possibly reduce work at its base in Tulsa, Okla.
DALLAS — Global military aircraft maintenance, repair and overhaul (MRO) spending was roughly $66 billion in 2011, but is expected to decline 2.7% this year because of reduced utilization and increased budgetary restrictions, according to consultancy ICF SH&E.
The overwhelming market response to the Airbus A320NEO and the Boeing 737 MAX, coupled with aggressive production rate growth plans by both OEMs, could create a huge wave of CFM Leap and Pratt & Whitney PW1000G engine shop visits by the middle of the next decade, according to an analysis by US Airways.
Southwest Airlines has aggressive plans to dispose of its Boeing 737 Classics over the next several years, but at the same time needs to keep pace, in a cost-effective manner, with the scheduled overhauls on the CFM56-3 engines that power those aircraft. The airline does not want to have to buy expensive new parts for engines that are unlikely to be in the Southwest fleet for more than just a few years.
Aveos Fleet Performance, the former maintenance, repair and overhaul (MRO) arm of Air Canada that has been operating as independent, privately held company since 2004, suddenly closed its doors over the weekend and sought court protection from its creditors under the Companies’ Creditors Arrangement Act (CCAA). In a statement late Monday afternoon, Aveos, whose primary customer is Air Canada, said it has ceased its airframe MRO operations and will make decisions about its other operations, primarily engine and component MRO, after assessing its options.
Pemco World Air Service, one of the largest independent airframe MRO providers in the U.S. and a long-time specialist in passenger-to-freighter conversions, Monday filed for Chapter 11 bankruptcy protection. The company says that it has secured debtor-in-possession (DIP) financing and that it plans to restructure and emerge from Chapter 11 within 90 days.