Engine Markets Waiting On MAX, But Relief Not Likely To Come Quickly in Summer

One source of relief from capacity pressures in engine aftermarkets will be increased supplies of used materials, which can only come from increased aircraft and engine retirements.

Mike Stengel, senior associate at Aerodynamic Advisory, thinks these will come when the Boeing 737MAX reenters service, but not necessarily as quickly as if the MAX had not been grounded. “If the MAX comes back in spring, the airlines will just be starting their summer schedules, the busiest time of the year, and may be reluctant to pull NGs out of service,” Stengel observes.

Engine aftermarkets are under stress for familiar reasons. Huge fleets of V2500s and CFM-56s are soaking up overhaul capacity, while new engines, GTFs, Trent 1000s and, to a lesser extent, LEAPs are coming off-wing much earlier than expected, and every time a solution is found for new engine teething problems, “there’s been another problem,” Stengel says.

Spare engines are scarce, with Willis’s orders for 50 LEAPs indicating OEMs are not meeting spare requirements. Parts, especially turbine blades, are another restraint, and major casters like Precision Castparts are not apparently adding capacity. It does not help that the new LEAP needs more blades than its predecessor CFM-56. “There’s lots the engine OEMs can’t control,” Stengel says. “Although Rolls-Royce may have more control with some internal casting capacity.”

Shop capacity has been tight, although MTUs and some others are adding capacity. Tightness in skilled labor markets is indicated, Stengel says, but the fact that Boeing did not lay off skilled aviation workers during the MAX production shut-down. “They may have been afraid they would lose them.” 

Mobile maintenance provided by some major MROs could relieve a bit of the scarcity in shop capacity, but Stengel does not believe, “it will move the needle much.” Airlines that can bring overhauls in-house have a big advantage, but this option is available only to a few giant carriers. Most must attempt to schedule shop visits well in advance.

The Aerodynamic consultant urges airlines to exploit their relationships with OEMs to access necessary spares. 

PMAs are not much of a solution to part scarcity, in part because OEM resistance has held PMA use in engines pretty flat, and partly because casting capacity is tight, and PMA makers depend on the same casting capacity as OEMs. 

Of course, carriers that are under flight-hour programs for new engines have already shifted much of the burden of tight capacity to OEMs or shops. But that solution has usually not applied to older powerplants.