Dubai Engine Part Specialist Seeing More Engines For Teardown

Dubai-based Aeras Aviation is seeing an increase in teardowns for CFM56s and V2500-A5s, says spokesperson Persia Rana. The engine aftermarket company is continually bidding for parts on these types, as it expects to be doing a large volume of shop visits on them over the next three to five years. “It is important to have a constant flow of materials for when those shop visits increase,” Rana says.

But the engine market is very small, and the same companies are always bidding on the same assets, making competition a little tough. “It is sometimes necessary to acquire a complete aircraft including both engines instead of acquiring individual assets.”

The Aeras exec notes that catalogue list prices for parts on these engines are still increasing 5-6% annually. Used part prices depend on a number of factors, including yield rate of the part, repair costs, history of hours and cycles and back-to-birth paperwork of a part to name a few. Taking into account these factors, “we are certainly not seeing a decrease in pricing,” Rana says.

Used part prices have been steadily increasing along with new part prices. Some used engine parts sell for as much 100-110% of new part prices, prorated by length of useful life remaining. “Part of this is driven by lessors wanting to maintain value of each their assets, resulting in their paperwork requirements becoming more stringent year on year.”

Aeras Aviation specializes in acquisition and part out of end-of-life CFM56s and V2500-A5s, repairing parts and selling them.

Rana says the company is small, with low overheads and margins, acts quickly and works closely with customers. The approach appears to be successful. Aeras did $4.5 million of business in its first year and $25 million in the second year. It has branches in London, Milan, Istanbul and Luxembourg and seeks to open a U.S. branch in 2020 or 2021. “One of our goals is to focus on quick engine change and line replaceable unit exchanges, an area we feel has lots of potential.”