Lessors and MROs celebrate IATA/CFM agreement

victoria@aviationnews-online.com
By victoria@aviationnews-online.com August 2, 2018 16:51

Lessors and MROs celebrate IATA/CFM agreement

The response to the agreement between the International Air Transport Association (IATA) and CFM International (CFM) announced yesterday which will substantially improve the opportunities available to third-party providers of engine parts and MRO services on the CFM56 and the new LEAP series engines, has been overwhelmingly positive. Lessors are very happy at the news, which will ensure their engine maintenance agreements are less complex and no doubt improve their portfolio values. Maintenance, repair and overhaul (MRO) companies, which are authorised CFM repair stations, too are celebrating the news. Aero Norway states that it is set to be a beneficiary alongside airlines, lessors, other third-party MROs and parts manufacturers.  The benefits will accrue for all parties via increased competition in the marketplace for MRO services on engines manufactured by CFM, leading to reduced operating costs.

Glenford Marston, CEO of Aero Norway, has praised CFM on reaching such a significant agreement with IATA and considers the knock-on effect that their new conduct policies will have across the entire industry.

“Authorised third-party repair shops like Aero Norway are part of a recognised expert supply chain and we are keenly awaiting ratification of the proposed new conduct policies” explains Marston. “These proposed measures mean that we will be able to pass on savings directly to airline customers, by reducing our ‘fully-burdened’ rates which presently include licence fees and a % of revenue per engine – this is our chance to offer more flexible engine MRO solutions and to give something back.”

He goes on to say that maintaining dispatch reliability, and reducing operating costs to ensure that airlines can thrive as businesses by continuing to offer affordable flights, are key aspects of the industry. “As OEMs seek to tighten their hold on the supply chain, operators and lessors of mature aircraft assets face enormous pressure as they seek to maintain, upgrade and transition older aircraft cost-effectively in the face of continued delays in new aircraft deliveries.”

Specifically the agreement covers CFM56 series engines. The CFM56-5B is the engine choice of the global A320 family due to its high reliability and durability, and the CFM56-7B is exclusively powering the B737 NG – making it the most popular engine combination in commercial aviation. However, CFM will apply the agreement to all commercial engines produced by the company, including engines in its new LEAP Series.

“Aero Norway aspires to remain a CFMI overhaul specialist for the foreseeable future as this is where the organisation holds a depth of expertise and knowledge,” continues Marston.   “We have held talks with CFMI and the team at Aero Norway hopes that the rigorously sustained quality output of the repair shop will support our strategy to obtain a licence for the LEAP engine because eventually there will be a lot of demand for this engine type and it is evident that the crucial role that third party repair shops play in maintaining the efficiency of supply chain is recognised.”

It will not be until the end of 2018 at the earliest that CFMI will consider granting any repair licences to independent MROs like Aero Norway. The costs involved with introducing the model, and evaluating the necessary tooling required, means that any potential introduction of the LEAP engine into the facility would be 2020 at the earliest.

victoria@aviationnews-online.com
By victoria@aviationnews-online.com August 2, 2018 16:51