Airlines with leased aircraft fleets and those with limited cash reserves are turning to green-time engine leasing as an appealing solution.

 

As flight schedules increase and passenger numbers take a positive upturn, Low Cost & Regional Airline Business Magazine approached journalist Alex Preston to speak to industry leaders to gain insight on green-time leasing.

 

Wasim Akhtar, Director of Engines at AJW Group, acknowledges the ongoing negative impact of world events on the global supply chain within the aviation industry. He notes a continued lack of serviceable used material and manpower resources are the primary reasons for the struggling supply chain. He continues by saying an exodus of qualified people and technicians out of the aviation industry into other industries has affected the level of qualified personnel available to service components. As a result, turnaround times are high in the MRO sectors.

 

Alex Vella, COO, Magnetic Leasing, holds similar sentiment and says engine demand is outstripping supply due to delayed shop visits, and this is putting pressure on lease rates and engine values. This applies to narrowbody engines, in particular, as more airlines are turning to these aircraft for long-haul flights.

 

‘By changing their business and MRO strategies, companies are looking at low-cost alternatives to new components and engines,’ says Akhtar. ‘The trend towards green-time engine leasing opens the door for growth in engine services across the globe, and moves the aviation industry closer to a more sustainable way of doing business.’

 

David Archer, Head of General Aviation and Aftermarket Value at IBA gives a detailed explanation of green-time engine leasing, and AJW’s Director of Engines puts it simply, ‘Green-time engine leasing involves harvesting engines from newly retired aircraft teardowns and using them with their useful life left, which could be anywhere from three to 36 months.'

 

Green-time engines ultimately conserve money, can avoid lengthy shop visits, and can bridge the gap when engines are undergoing repair or downtime. These engines allow for flexibility, reduce downtime, and save on maintenance costs.

 

 

Industry experts agree that green-time engine leasing is a popular trend in the industry as financial considerations are foremost in stakeholders’ minds. This is most certainly a viable option for airlines in the current climate.

 

Akhtar discusses what type of airline customers take advantage of green-time engines, and Archer lists various suitable engine candidates. The article discusses details about redelivery conditions and engine life and explains what lessees and lessors look for when inspecting an engine for green leasing to ascertain the remaining life of the engine.

AJWs Wasim Akhtar notes several challenges facing maintenance teams dealing with Entry into Service (EIS) issues for newer technology engines, among these being technical, labour, and material supply. He remains positive, however, even in the aftermath of the pandemic as he says there is now a stock of healthy spare engine supplies.

 

The article concludes with Akhtar saying, 'Having a good supply of cheaper, serviceable engines with favourable lease rates now available, the trend among airlines is to save costs by delaying the replacement or restoration of ageing engines and opting instead for the green-time engine leasing opportunities that are available.’