Guy Norris/SAN DIEGO

Shannon Engine Support (SES), an Irish-based company specialising in supporting the CFM International CFM56-3, is promoting a concept in which airlines will club together to create a pool of spare engines. The initiative has been prompted by estimates that the industry will have to spend $30 billion on spare powerplants over the next 20 years.

Outlining the idea at the Aviation Industry Conferences engine meeting in San Diego, California, SES managing director Heber McMahon said that airlines would each purchase or lease a minimum number of engines for their own use, giving a "60%confidence level" of immediate availability.

The airlines would then work together to build up a pool of additional powerplants, taking confidence levels to 80%. These incremental engines would be pooled for "defined access" by all the participating airlines. The pool itself would be managed on a fee basis by an independent agent, such as SES, according to McMahon. The agent would be free to raise revenues from spare capacity.

SES believes that the concept would not only help reduce initial capital outlays, but would also help airlines get full use out of their assets and guarantee spare capacity.

SES predicts that, with 16,000 new aircraft delivered over the next 20 years, engine requirements would run to about 38,400 units. Of these, 4,600, or 12%, are likely to be spare engines - down from the current ratio of 17%. Based on an average engine cost of $6.5 million, this generates a 20-year market worth $30 billion and an annual spend of some $1.5 billion.

"At the moment, up to 25% of commercial aircraft are leased by the airlines and this figure is growing annually," says McMahon. "It is reasonable to assume that airlines will not purchase spare engines to support leased-in aircraft. It would also appear that the major aircraft lessors have little appetite for the smaller ticket business," he says.

Source: Flight International