Fast 5: Engine Values Drive Earlier Aircraft Teardowns

Shane Hennessy, origination and trading EMEA director at EirTrade Aviation, discusses how engine values and parts demand are driving earlier aircraft teardowns and the company’s plans to expand disassembly activities.

What are you seeing in the aircraft teardown market, and are asset owners increasingly considering younger aircraft for disassembly?

Teardown economics remain strong across all airframe types, although we expect a higher rate of Airbus A320ceo and Boeing 737 aircraft retirements over the next 12 months. We’ve already seen several A220s come to the market, and we anticipate more to be parted out in the next six to 12 months. On certain widebodies, 777-300ER and A330 especially, EirTrade Aviation is competing for feedstock against P2F conversion parties looking to extend the aircraft's economic life rather than tear it down, which is tightening supply on those types further. The bigger shift is that asset managers are progressively choosing to part out airframes earlier. Up to 90% of an aircraft's value can sit in the engines, and that economics has driven decisions well ahead of where they would have been made historically. We have recently partnered with Residco to disassemble two of the youngest A320neo-family aircraft (ex-Spirit Airlines) ever committed to teardown, purely because engine and component demand justified it.

Which aircraft and engine types are currently most attractive to EirTrade, and how are parts shortages affecting asset values and teardown decisions?

We are actively pursuing a variety of airframes. In the narrowbody market, we are focusing on the A320ceo/neo, 737NG and 737 MAX platforms; and on the widebody side, the A330, 777 and 787. On the 787 aircraft platform, EirTrade Aviation managed the first two 10-year-old 787-8s ever retired from commercial service, back in 2023. On engines, our current focus is acquiring CFM International CFM56-5B/7Bs, Pratt & Whitney PW4168s and GE Aerospace CF6-80E1s for teardown. Parts shortages are reshaping both valuation and timing. Asset managers are choosing to part out aircraft earlier in their life rather than running them to the end of a lease or D-check cycle, where aircraft were historically torn down at 24 years old, because engine and rotable values now outstrip the return from keeping the aircraft in service. At the same time, scarcity is pulling in more buyers chasing the same pool of teardown candidates, including passenger-to-freighter conversion parties competing for widebody feedstock, which is pushing up acquisition prices for suitable aircraft. Together, these conditions mean teardown decisions are being made faster and further ahead of an asset's natural end-of-life point than they were even a year or two ago.

EirTrade has expanded its aircraft and engine disassembly capabilities in recent years. What further investment or capacity growth are you planning?

EirTrade Aviation has received full planning permission from Mayo County Council to quintuple our Knock, Ireland, facility, adding 10,500 m² (113,021 ft.²) to our existing 2,100 m² site, including a narrowbody-capable hangar for disassembly. Our Part-145 line maintenance-approved facility provides parking and preservation, and AOG support for major European airlines and lessor partners. It's also where we can tear down CFM International CFM56 engines, and it remains the only airframe teardown location in Ireland. Our goal is to create a center of excellence in Ireland where we can strategically support our customers both in the aircraft leasing community and airline customers.

How is EirTrade positioning its used serviceable material (USM) business as airlines and MRO providers seek faster, more economical alternatives to new parts?

USM has gone from a cost-saver to, in many cases, the only realistic route to availability. We've seen continuous growth in USM demand throughout all aircraft types as airlines lean into fleet-renewal strategies. USM typically prices well below new OEM parts, but the real draw is improved lead time.

Where does EirTrade see its strongest growth opportunity: aircraft disassembly, engine asset management, component trading or broader lifecycle services?

We don't see these as separate bets, and we pride ourselves on taking opportunities and being adept across all of them. That's the thread running through our track record: EirTrade Aviation tore down the first two 787s ever removed from commercial service in 2023. In early 2026, we partnered with Residco to disassemble the two youngest A320neos to be torn down, and over the last number of years, we have previously managed the teardown of brand-new CFM56-5B and CFM56-7B engines. Each was a case of moving on an opportunity as soon as the economics justified it, rather than waiting for an asset to reach a conventional end-of-life point. Looking ahead to growth, we're building out our pool of on-lease aircraft and engines over the next 1-3 years to ensure guaranteed feedstock for the USM pipeline.