In the May issue of AviTrader MRO, Keith Mwanalushi gets some answers by speaking to Wasim Akhtar, Director of Engines at AJW Group, and others in the industry. He enquires about the effects of the ‘bottlenecks’ in MRO services brought about by deferred engine shop visits during the pandemic.

 

AJWs Director of Engines takes the hot seat first, opening with an optimistic statement,

 

‘In line with the surging demand for travel, the aircraft engine leasing market is undergoing immense growth.’

 

To avoid high capital costs associated with buying engines, airlines are choosing to lease engines rather than purchase them, as this gives them more flexibility in terms of fleet and risk management.

 

Akhtar observes, ‘With the pent-up demand for engines, the traditional dry leasing routines have come back, and AJW is seeing the rates going back to 70 percent of pre-pandemic levels.’ He discusses the fierce competition in the market and the increase in the number of engines needing overhaul or retirement. Mwanalushi says this is impacting engine part demand and the MRO market, but is positive for companies such as AJW Group, that offer MRO services and the supply and lease of components.

 

 

Craig W. Welsh, SVP and Chief Commercial Officer at Willis Lease Finance Corporation (WLFC), comments on the short supply of new aircraft green time engines and how airlines are adapting business operations to find more financially sound ways to handle maintenance services. He does express his concern at the possibility of green time engine supply not meeting market demand. 

 

Marc Pierpoint, SVP, Head of Trading & Investments at WLFC, notes that due to supply chain and service delays, the demand for narrowbody engines is strong. Al Landolfi, VP and General Manager, Willis Aeronautical Services, Inc, offers his comments on the diminished, but still evident, logistic challenges and how these continue to affect supply chain fulfilment. 

 

Akhtar discusses pre and post-pandemic engine supply noting that ‘the demand for green time engines exists for the foreseeable future.’ There is agreement within the industry that cost saving is foremost among airlines, who are postponing replacement and repair of engines in favor of the various green time engine leasing options. 

 

David Blackburn, Senior Vice President, Asset Leasing & Trading at PTS Aviation (a Standard Aero company), follows with his insight into engine demand, and AerFin, Director of Trading, Nick Filce, says his company is seeing a ‘significant demand for both the engine leasing and trading pool, along with engine components division for materials.’

 

Mwanalushi explains that IBA data indicates that lease rates have recovered to pre-pandemic levels for certain engines and that delivery delays are leading to increased demand, and Filce further explains supply chain demands and needs relating to green time engines, teardowns, and sales.

 

Ryan Anderson, VP Commercial – Americas at Aero Capital Solutions (ACS), touches on the depleted industry workforce as a contributing factor to long TATs and maintenance shop delays and delves into the rising cost of parts and services. He comments on the fact that ‘inflation in MRO costs for engines’ is contributing to the increased demand for green time engines and explains more about engine delivery contracts.

 

Mwanalushi concludes the article by speaking to Joe Hussar, Executive Vice President – Head of Portfolio at Engine Lease Finance Corporation (ELFC), who offers his views on what is being done with green time engines once they come to the end of their workable life. Hussar reiterates Akhtar’s earlier observations about the sustainability of the market despite the gloomy global economy.