Podcast: Inside The CFM Leap MRO Network Ramp-Up

As the CFM Leap family of engines approaches 4,000 in-service engines, a figure forecasted to double by 2030, Aviation Week editors James Pozzi, Thierry Dubois and Lee Ann Shay discuss how the network is ramping up and how repair developments are pacing. Is it quick enough? What are Safran and GE doing differently than with the CFM56 support program?

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Transcript

Lee Ann Shay:

Welcome to the MRO Podcast. I'm Lee Ann Shay, Executive Editor for MRO and Business Aviation for Aviation Week. Today's subject, the CFM LEAP aftermarket and what the industry is doing to support it. As background for today's discussion, Aviation Week's fleet and forecast data shows that about 3,400 CFM LEAP engines are in service today, but that fleet should double by 2030, about five years away. As you all probably know, the LEAP 1A powers the Airbus A320neo and the LEAP 1B powers the Boeing 737 MAX families. There are about 10,000 LEAP engines on order or options over the next decade, according to the Aviation Week data.

To discuss this hot market, two of my colleagues who have been covering this are joining me, James Pozzi, our MRO Editor for the MIA region, and Thierry Dubois, Aviation Week's European Technology Editor and our France Bureau Chief. Gentlemen, welcome. To start off Thierry, you visited Safran a couple of weeks ago in Brussels where they talked about the shop network, which is dealing with both scheduled maintenance and the technology insertions. What's your take on the network and the shop demand?

Thierry Dubois:

Well, they are obviously expecting high demand for LEAP engine maintenance, especially shop visits in due time, related to the very fast growth in LEAP engine fleet. As you mentioned, the numbers are already high and expected fleet to double, as you mentioned, in the coming years. They... I when say they, Safran and GE, so Safran Aircraft Engines and GE Aerospace, have a different agreement compared to the agreement they had, they still have with the CFM56, which is the predecessor of the LEAP engine, and a new agreement calls for the two companies to be on a par in terms of offering services to customers. So they no longer compete. It's a joint venture also about maintenance and the agreement is quite far-reaching. GE and Safran have defined three regions in the world, the Americas, Asia-Pacific and Europe, the Middle East and Africa. And in each of those regions, both companies, GE and Safran are offering, are going to offer LEAP maintenance services, as opposed to one company being in charge of one region and the other one another region.

So an airline operating LEAP engines in North America, for instance, may have part of its fleet maintained at a GE Aerospace service facility, and the other part of the fleet, if that's convenient, at a Safran Aircraft Engines facility. So it's a very different scheme, different organization for the two companies. And it means that both of them are investing in new capacity for LEAP maintenance, and especially true for Safran, which network used to be smaller in number of facilities and in capacity, smaller than GE's network. So Safran is investing a lot.

Lee Ann Shay:

Great. And they also talked about developing parts repairs, and the industry always clamors for more parts development. Can you elaborate what you heard?

Thierry Dubois:

Yes, absolutely. So in addition to shop visit, to engine shop visits where the engine is inspected and parts are possibly replaced or modules are possibly replaced with new ones, they are developing parts repair capacity slightly further down the line. So they will keep investing in parts repair after 2030 and they are developing new ways to repair parts as opposed to replacing them. Of course, you are more competitive when you offer a repair than a replacement, and by the way, it's better for sustainability if the parts last longer.

So it's quite impressive, again, in numbers and in investments. And for instance, they are developing, I think it's 250 new repair processes per year for the LEAP. And when I say they, it's Safran only. So maybe GE is doing the same.

Lee Ann Shay:

Repair development is such an important part. Like you said, there's a sustainability aspect. It's usually cheaper, and especially with the supply chain constraints, you can usually do a repair faster than getting a new part. But actually, no, that's sometimes not true because some of the component repair shops are having slower turnarounds, but still, I agree, repairs are important.

And James, speaking of repairs, you recently wrote about some engine shops such as TAP and Israel Aerospace Industries adding LEAP capabilities in the past month. What stands out to you?

James Pozzi:

Yeah, well, these were quite major announcements. They've really added or will add extra capacity to the LEAP network in Europe, which obviously is growing. Obviously, got some companies that have been in it for some time here, notably Lufthansa Technik and Air France, KLM Industries Engineering and Maintenance. But yeah, as we mentioned that the volume of LEAPs is going to be huge. So they need more capacity for overhauls testing, but in the immediate future, one that they need shops to do hospital shop visits or quick turn services because there's such high demand for that now, and that's something I could touch on later with what some smaller shops are looking at towards that.

But yeah, back to some of these new shop announcements then and that network growth. So let's start with Israel Aerospace Industries. They've been very busy this year, took them around six months, I believe to get the certifications for both the 1A and the 1B. So pretty impressive how quickly that was done, and there's going to be a lot of investment there. Obviously, in tooling, the workforce, they're going to expand and grow at their Tel Aviv shops. So it was the end of the summer when they got the one 1A capacity... Sorry, the 1A capability, which of course, is for the Airbus A320neo aircraft. And they've just added 1B last month, a couple of weeks ago now, at the end of October.

So initially, these will be quick turn services. They've already [inaudible 00:06:50] their first 1A and the first 1B is coming into the shop, I believe sometime this month. But the scale of their operation, I've yet to go to that facility, but I do know they have 15 hangars in total, which covers a whole load of maintenance activities, base maintenance, obviously the P2F, passenger-to-freighter conversion services they do. And obviously, they've got a lot of engine capacity there. Seven test cells for engines, which is a lot of test cells, but they've earmarked two of those test cells for the LEAP. But given the scale of the operation, they say capacity is still in short supply. They need to keep building in order to meet some of this demand. And they do plan to open a new engine facility which will have a big LEAP focus by 2027. They're currently going through the stages to get that built, but yeah, to really show a sign of the scale of the operation is that between next year and 2026, they estimate that they'll be inducting 80 to 100 LEAP engines annually.

Now, that all sounds very good, all that demand, but given that the lead times on LEAP engines can in the most extreme cases, still surpass 200 days, and that's certainly been the case over the last few years due to a multitude of factors around workforce, part shortages and even tooling supply, to name but three. If these engines are taking up these slots for long amounts of time, they'll make it difficult to induct more engines and that's when that demand outstripping supply becomes a problem. So a lot of investment there from them. And also of course, yes, as you mentioned, Lee Ann, tap maintenance and engineering. Of course, they do some engine services in Lisbon. They focus on a few engines there, but yeah, they've added LEAP 1A capability for the Airbus A320neo, and they're going to open up some slots to the market by 2025 and they're going to ask for approval, FAA and the UK CIA, and they're looking for the Chinese regulator, the CIA, shortly to get approval there, to open up that.

So they've already inducted their first LEAP engine, and one of the challenges I was told by them is that balancing capacity with the existing CFM56 and engine repairs, which of course, is a program that has many years left. That's not going away anytime soon. It will decrease obviously as over the years, as more LEAPs come into service and more newer aircraft variants, but the CFM56 has a lot of life and a lot of shop visits left on it still.

TAP, like IAI, is also building a new engine shop close to its MRI facility in Lisbon, to add that further capacity as well. And they're also investing in some side repairs too. Nacelles is one area they've looked to target for the 1A and they want to add complementary parts repair service as well to the program. And they're obviously going to focus on the nacelles repair market, which they see as quite a good opportunity for them as well.

Thierry Dubois:

So James, you referred to that 200 days lead time for the LEAP. The numbers we had in Brussels were a bit more optimistic, but apparently you had very good info, very good insight. But as far as Safran is concerned, they say that the turnaround time for LEAP engine shop visit is slightly above 100 today, and they are aiming to cut that down to 70 days, which has been the CFM56 standard.

James Pozzi:

Yeah, back close to the average. I'm not sure if that was in the most recent example. IAI said that was an extreme example. Of course, I know just after the pandemic at some of the early engine conferences we attended, certainly people were reporting that for the LEAP, but that definitely does sound more optimistic and like they have got a grip on those TATs.

Lee Ann Shay:

To jump in there, a slightly different topic this week also, a new high pressure turbine blade for the CFM LEAP 1A is nearing regulatory approval, and that should start shipping to overhaul shops by the end of the year, according to Safran, and that is going to address the hot section durability issue. So hopefully once that blade is shipping and integrated into the engines, that should also help shop times too, I think.

James, you brought up a really good point about the LEAP. The CFM56 is a venerable engine, lots of them flying and they have a long life left. And a lot of the same shops that are servicing the LEAP and working on the LEAP ramp up are still servicing the CFM56 family engines too. So I think all that comes into the quick turns too. Shops just need to be as efficient as possible to be able to turn these engines from module swaps to these quick turns.

James Pozzi:

Absolutely. Yeah. And balancing that capacity is going to be a challenge, but also something that a lot of these shops are really focusing on and how they can have that throughput of CFM56 engines, but also meet the LEAP demand. Some shops with the resources have built separate LEAP shops or maybe separate from other engines they repair, focusing or dividing them from the other repairs they're carrying on other programs. So that's a method they've used to help things. But yeah, they're not going to be short of work, that's for sure, especially on those two engines. But the LEAP is really changing how some of the smaller companies, especially the ones that will just do quick turns or hospital shop visits, not the full overhauls that maybe the larger MROs will do.

There's one company in the UK who I visited a few months ago. They've completely almost changed what they're doing to really focus on the LEAP. They've moved into a new facility and the LEAP is just going to drive what they're doing, these quick throughputs where it'll be very minor repairs, and then it leaves the shop after a certain time and they get the next LEAP engine in from nearby Heathrow Airport, for example. And also, it is interesting, some of the new players in the LEAP market, so United Aerospace Maintenance Company, they're a new company that was set up this year in Cyprus. They're just simply focusing on LEAP 1A and 1B quick turn and hospital shop visits. They've just actually, just before we came onto the podcast, signed an offload agreement with GE to do those quick turns.

So they're going to have a high throughput as well going out there. But even Magnetic MRO, of course, who have in the last few years in Estonia, have one of several companies that ventured into hospital shop visits and quick turn services during the pandemic time when there was so much demand for that. They want to grow their engine lines in Tallinn, and they cited the LEAP as a big reason for that, and they want to add those capabilities.

So I don't think these shops will be alone. I think we'll see a lot more of these MROs adding more capability, and that'll be interesting, obviously as the LEAP network grows as well, which companies will join that network and who will have the capability? But yeah, it's got so much focus now from shops and they are, as I say, going all in on that program.

Thierry Dubois:

Talking about the transition for the coexistence of the two programs, the CFM56 and LEAP, in terms of parts repair, Safran is using the skills its engineers and technicians already have in CFM56 parts repair as a basis to develop new parts, to perform parts repair for the LEAP in existing facilities. And of course, that's for the parts that can be compared between the two programs. Some cannot be compared such as the fan blades, the fan blades on the LEAP, our composite fan blades with a titanium leading edge, a very high technology that Safran developed over the last couple of decades. And they are going to turn the production facilities, one in France, for example, the one is in Eastern France, in Commercy. They are going to add maintenance capabilities. So it'll not only be a production facility, but also fan blade maintenance facility.

Lee Ann Shay:

Lots of developments in the market and I think we could talk for a lot more, but we have run out of time. So Thierry and James, thank you for your insights. Very much appreciate it. And that's a wrap for this MRO Podcast. Don't miss the next episode by subscribing to the MRO Podcast wherever you listen to them. And one last request, if you're listening in Apple Podcasts, please consider leaving us a star rating or writing a review. Thank you.