IBA, aviation market intelligence and consultancy company, has predicted that engine market values and lease rates are likely to increase given the current and ongoing supply chain issues and the more specific GTF engine problem.
The company expects the industry to suffer longer term due to growing pressure on shop visits and turnaround times, which are forecasted to increase.
MRO shop visits are already under pressure from the post-Covid resource gap and the unscheduled GTF engine inspections, the IBA team, comprising President Phil Seymour, Engine and Parts Manager Jamie Davey, and Sarah Farrugia-Warren Senior Technical Manager - Powerplant, said. Previous generation engines are still undergoing shop visits following deferred maintenance because of the global pandemic, resulting in high parts demand.
In the shorter term, turnaround times are likely to be strained further as Pratt & Whitney GTF engine issues increase pressure. The number of engines due to be inspected will cause a short-term spike in shop visit demand and the impact will be far-reaching, especially if the mandated inspections of the high pressure turbine (HPT) create additional work once engines are opened up.
Some of the operators most affected by the GTF issues include Go First with 88 engines, IndiGo with 80 engines, and Air China with 36. Other affected airlines include large A320 operators such as Wizz Air.
“We have to remember that the engine OEMs are at the leading edge of design and material technology. The incredible advances in fuel burn saving over the decades has led, and will likely continue to lead, to some form of Airworthiness Directives action. It's the price we pay for driving towards more efficient aircraft and engine combinations, with the overriding need for safe operations. We will have to see if the fuel burn benefits also create a long-term improvement in on-wing times and overall lower cost per hour/cycle,” said Phil Seymour, IBA’s President.
IBA predicts that, in 2024, there will be around 2,500 shop visits (excluding the GTF additional shop visits) followed by a significant jump to 3,500 visits in 2025. There were 2,250 visits in 2023. This situation should come to a slight plateau between 2025 and 2027 at around 3,800 visits annually before peaking to over 4,000 visits in 2028. This will then start to decrease, ending the decade just below 4,000 visits in 2030.
According to the company, here will be new engine production delays and USM supply chain demand will continue to affect values and lease rates.
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