CASL Plans Aircraft Disassembly Ops As China’s USM Market Accelerates

BEIJING—Hong Kong-based MRO provider China Aircraft Services Limited (CASL) plans to launch an aircraft disassembly and dismantling business that it expects to open the flow of used serviceable material sales into and out of China.

On the sidelines of MRO Greater China, CASL CEO Norbert Marx told Aviation Week that the company is working to obtain regulatory approvals and accreditation from the Civil Aviation Administration of China (CAAC), Hong Kong’s Civil Aviation Department, the European Union Aviation Safety Agency (EASA) and the Aircraft Fleet Recycling Association. 

The goal is to begin pilot teardown and disassembly projects in August and “set up a good trading platform and bring additional value to the old system or options for traders and airlines,” Marx said.

While launching this type of business in Hong Kong may not initially sound logical, “because you need cheap land and cheap labor,” which are hard to come by there, Marx noted that “Hong Kong has a tax-free environment and you can bring aircraft in tax-free.” He added: “Normally, if you dismantle aircraft in mainland China, under the rules of the CAAC, you only can sell the parts in China, and if you do it outside of China, you only can sell them outside. We think we can sell both inside and outside.”

CASL will first harvest parts under its Part 145 certification from its hangar at Hong Kong International Airport, then transport them to a dismantling site for further disassembly. Marx said everything will then be transported by barge to a full end-of-life recycling facility it is developing with its joint venture partner Elior Group, a subsidiary of Derichebourg Group.

Marx aims to do three disassembly projects this year, which could potentially increase to 25 or 26 projects annually. “After a ramp-up phase, we hope we can also do it in a technical, very efficient, and very environmentally conscious and responsible way,” Marx said.

Aircraft recycling and used serviceable material (USM) were major themes during the MRO Greater China conference this week. Stakeholders noted that China is seeking to proactively address supply chain challenges as production rates lag and aircraft lifespans increase.

Airbus and its parts subsidiary, Satair, presented on the country’s projected MRO and USM growth, noting that they expect China’s aftermarket to grow at a 5.1% CAGR—the highest among major regions—and to generate approximately $63.8 billion in demand by 2044. The aircraft manufacturer opened the Airbus Lifecycle Services Center in Chengdu in 2024, which has established teardown and recycling capabilities for the A320 and A330 under CAAC and EASA approvals. Its sister company, Satair Chengdu, also provides USM distribution services.

Felix Yang, head of commercial for the Airbus Lifecycle Services Center (ALSC), told Aviation Week that the company expects demand for 100 aircraft teardowns in China annually over the next decade. However, he noted that Airbus is in discussions with the government to address regulations that prevent aircraft disassemblers in China from dismantling aircraft from other countries.

Marx said CASL’s new disassembly and dismantling business will “offer something in addition” to the ALSC. “There is a lot of demand in the market still for harvested parts, especially in the region,” he said. “It is very common in the U.S. and in Europe, but not so much in Asia yet, so I think there is an opportunity and there are enough aircraft to be dismantled for Airbus and for us together.”

Beyond disassembly, CASL is also exploring options for a parts-trading platform tailored to Hong Kong. “When you want to sell in China, you have to use the [Civil Aviation Maintenance Association of China] platform,” he said. “If you work outside, there are some established channels you can use, but I think Hong Kong doesn’t have their own platform yet and I think that could also be interesting if we really get to the scale [that CASL is targeting].”

CASL is a joint venture between China National Aviation Corporation (Group) Limited, Hutchison CCF Investments and China Airlines Limited. It operates from a 100,000-ft.² hangar at Hong Kong International Airport, offering a range of services including line and base maintenance, Part 147 training, ramp and cabin services, supply chain management and aircraft-on-ground support.