Niche Numbers Belie CF6-80A’s MRO Prospects
Potentially lucrative aftermarket opportunities are usually linked to metrics that highlight growth, such as an expanding fleet population or an imminent wave of overhauls. In the case of aircraft powered by the General Electric CF6-80A turbofan, however, the opposite is true: A small fleet that remains integral to its operators has created a chance for savvy providers to generate business.
GA Telesis is a prime example. The aftermarket services specialist counts Air Transport Services Group (ATSG)—a cargo aircraft operator, lessor and maintenance provider—as a long-time customer. ATSG or its subsidiaries, a group that includes lessor Cargo Aircraft Management, own 33 of the 47 CF6-80A-/80A2-powered aircraft left in the global fleet—all Boeing 767-200s or -200ERs. All but three are freighters, making them desirable assets amid a global downturn in travel demand that has resulted in an increase in belly capacity on parked passenger aircraft. This has occurred at the same time some freight segments, notably e-commerce-driven shipping, are rising.
Last summer, ATSG and GA Telesis saw an opportunity to expand their relationship by focusing on the CF6-80A/A2 fleet. The companies struck a deal that sees GA Telesis provide repair, part-out and inventory management services for ATSG’s CF6-80A-family engines. Material pulled from disassembled engines is fed back into ATSG’s fleet as well as offered to other operators and MRO providers.
The arrangement gives GA Telesis an expanded business line with an established customer. Meanwhile, ATSG can focus on growing its overall operation without becoming bogged down in how to best leverage a sunsetting subfleet.
“It is fair to say that the -80A became a unique opportunity, conceived from our long-standing cargo business relationships and born from our partnership with ATSG,” says Russ Shelton, president of GA Telesis’ Engine Strategy Group. “It only made sense due to the ATSG concentration of the -80A fleet within its operators and Cargo Aircraft Management.”
GA Telesis has disassembled “multiple” -80As “over the years,” Shelton says, including some linked to its ATSG partnership. Part of the challenge going forward is sourcing enough parts to maximize the fleet’s service life without relying too much on cannibalizing engines. While a jump in freighter conversions will help add capacity to the midsize widebody freighter fleet that the 767-200 helps fill, the slump in long-haul passenger demand likely means freight operators will need all of the dedicated cargo aircraft they can procure for the next several years. That could make the 767-200Fs too valuable to park unless absolutely necessary.
“This will be an ongoing challenge,” Shelton says. “Generally, supply is meeting demand at the moment. However, the situation could change rapidly. Therefore, we are actively seeking sources to continue to support the requirements.”
The global 47-aircraft fleet is old; airframe manufacturing dates span from December 1981 to February 1990, Aviation Week Fleet Discovery data shows. But its key role in the high-demand cargo market means it is both stable and active.
Aviation Week’s Tracked Aircraft Utilization (TAU) figures show half of the active fleet averaged at least two cycles per day in November, and 27 aircraft topped 100 flight hours.
A look back at comparable data from November 2019 shows 50 aircraft listed in the global fleet, meaning only three were removed during the pandemic. The aging fleet’s staying power is impressive under any circumstance, let alone one that has seen scores of aircraft sent to the desert until demand trends become clearer. Even more notable is the average number of flight hours and cycles per airframe were higher in November 2021 than November 2019, TAU data shows, further underscoring the fleet’s importance to its operators.
Steady flying and few projected retirements mean the CF6-80A aftermarket’s near-term prospects, while niche, figure to be consistent. Aviation Week’s MRO Prospector forecasts 30 engine overhauls through 2024, generating about $137 million in business. Most of them are projected in the next two years, with 12 per year in both 2022 and 2023.