Dallas-based BeauTech Power Systems and Japanese conglomerate JALUX have formed an aero-engine leasing joint venture (JV) which is set to invest $150 million in Airbus A320 engines.
The newly formed business, named BVJ Engine Holdings, has been created as a 50-50 JV. BVJ has a mandate to buy up and then lease International Aero Engines V2500-A5s, which power A320-family aircraft, and Pratt & Whitney PW1100Gs, which power A320neo-family aircraft.
The JV will combine BeauTech’s engine leasing experience with JALUX’s V2500 and PW1100G MRO data. JALUX will also give the partnership a strong presence in Asia, particularly in Japan.
“BVJ Engine Holdings will acquire up to $150 million in engine assets in its initial phase,” the partners said on announcing the JV in mid-March.
The JV is planned to offer short- and long-term engine leases to help clients minimize aircraft downtime. Both Pratt & Whitney and CFM International are progressing durability upgrades for their respective new-generation engine families. The backlog of upgrades to be implemented have forced airlines to park substantial parts of their fleets; PW1100G operators particularly have been suffering.
“Reliable engine availability is critical to airline operations,” BeauTech Power Systems president and CEO Lee Beaumont said.
Founded in 2011, BeauTech Power Systems is active in engine leasing, asset management, aircraft and engine trading. The company’s portfolio includes GE CF34, CFM56 and Leap engines. JALUX was established in 1958 as a subsidiary of Japan Airlines (JAL), and is active in aviation, MRO, retail and travel services.
Hiroshi Naito, JALUX managing executive officer and Aviation & Airport Unit president, said the partnership will broaden JALUX’s global footprint. “We are always looking for opportunities to expand our role in the aviation industry,” he said.
At Aviation Week’s Engine Leasing, Trading and Finance Americas conference in January 2025, industry experts said they expect leased engine demand to remain high for years, with airlines are increasingly assuming mid- to worst-case scenarios for new aircraft deliveries.
Speaking at the January 2025 event, Engine Lease Finance Corporation (ELFC) EVP Joe Hussar said that of ELFC’s portfolio of around 600 engines, only nine were off lease. Meanwhile, 85% of ELFC’s leases had been extended, because of upgraded engine delivery delays. MTU Maintenance Lease Services MD Patrick Biebel also noted a “complete imbalance of demand and supply,” creating extremely high demand for leased engines.
On a Feb. 26 earnings call, AerCap CEO Aengus Kelly said he expects OEM delays and engine reliability challenges to continue into 2025 and beyond. “These are very desirable assets,” he said, referring to the strength of AerCap’s engine leasing business.
AerCap partners with the OEMs on engine leasing, moving “vast numbers” of engines around the world every week. The business is very logistics focused, moving engines to where they need to be, often at short notice. “It's a different type of business to leasing,” he said.
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