This is a higher than its earlier forecast that the industry will grow 3.
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However, they could be hindered by rising labour costs and temporary infrastructure and capacity constraints. However, it will lose four percentage points of market share. The Middle East could grow at 4. Article source. Every year commercial passenger and freighter aircraft are withdrawn from service.
The number of organizations offering teardown or part- out services has increased in recent years. The part-out process is described here. Potential part-out candidates and resulting asset values are considered. Some of the main teardown service providers are also summarized.
The part-out process involves an aircraft being withdrawn from service and dismantled. Engines and other components are removed and either returned to stock to support the rest of the fleet, or made available for sale or lease so that the owner can maximize asset values. Aircraft might be parted out when they still have years of operational life remaining because owners believe the sum of the parts is worth more than the revenue that could be obtained from continued operations. Alternatively, an aircraft may be parted out as it approaches its utilization threshold or when it becomes obsolete.
Aircraft might belong to different types of owner when they are parted out. These include airlines, leasing companies, banks, specialist investment funds and parts trading companies. Mike Corne, commercial director at eCube Solutions, believes that airlines account for only a small percentage of global part-out demand.
Banks and leasing companies may occasionally be customers in the part-out process, but typically dispose of aircraft before they are disassembled.
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In many cases, aircraft are sold or consigned to parts trading specialists shortly after they are removed from service. Touchdown Aviation TDA is a parts trading specialist with experience of the part-out market. It offers aircraft component sales, leasing and exchange programs.
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TDA manages part-outs for aircraft it has acquired directly or that it manages on a consignment basis for third-party owners. AJW Aviation is another parts trading specialist with experience of the part-out market. It provides component sales, loans, exchanges, power-by-the-hour PBH support and parts pool access, among other services. The part-out process is appealing to parts specialists like AJW Aviation, because it provides an avenue for them to obtain high-demand component items at lower costs to support their PBH and sales activities. Selling or consigning an aircraft for part-out to a parts trading specialist allows third-party-owners to make returns on component asset values without having to invest in developing skills and experience outside of their core business activities.
AJW Aviation has previously bought its own aircraft to part-out, but has also managed the process under consignment agreements. Parts trading specialists will contract a third-party dismantling provider to tear down an aircraft in most cases. There are occasional exceptions to this rule, with some organizations providing combined trading and dismantling services. Some components will be removed from the part-out aircraft in serviceable condition.
Others may need to be sent for inspection, repair or overhaul. AJW Technique provides us with high- reliability repairs and competitive rates, which helps us to control re-certification costs.
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Engines and components will be returned to the parts trading company once they have been removed and, if necessary, sent for inspection or repair. They will then be added to its spares inventory where they will be made available for sale, lease and PBH component support services. Some parts trading companies like AJW Aviation will part out airframes and engines. Others, such as Aviall, only focus on engines. These agreements often involve forecasting, ordering and delivering OEM replacement parts through our worldwide distribution and supply chain capabilities.
Some other parts traders might specialize in the part- out of older types with fewer in-demand and lower value components.
It is not unusual for an aircraft to enter a short period of storage following its withdrawal from service while ownership changes hands and final decisions are made regarding its ultimate fate. Many dismantling providers also offer storage services. Some dismantling companies will be approved Part maintenance providers, or will work closely with a partner or affiliate Part organization.
This allows them to provide necessary care and maintenance during any storage periods. In most cases, the aircraft will be sold or consigned to a parts trader before the physical teardown process begins. The engines are inhibited when all of the necessary checks have been completed. Upon completion, all the extra spoiler locks, gear door locks and gags are fitted to prevent inadvertent operation and relevant circuit breakers are pulled to prevent the operation of systems.
At this point the hydraulics are drained, the fuel is removed, tanks are opened for venting and all gaseous systems are deflated.
Depending on the level of demand and maintenance status, engines may not be parted out with the rest of the aircraft. Each aircraft that is disassembled will bring two engines on to the market. These may be disassembled for parts, leased out, used internally or scrapped for their metal value. Since airframe and engine life cycles are not necessarily in sync, some engines may be parted out independently of any airframes.
Spoors says that once the engines have been removed, items including the auxiliary power unit APU , avionics, flight control actuators and air- conditioning and hydraulic systems components take priority. The interior is then removed, including the seats and carpets. The disposal of such materials comes with additional associated costs.
Parts are normally shipped straight to the customer that owns the asset. If they need a shop visit they may well sit on a shelf until a demand arises. A number of scenarios could lead to certain aircraft types or individual airframes becoming part-out candidates. The part- out process may also appeal to operators looking to exit an aircraft type entirely or for those who want to retire an aging fleet. If it makes economic sense, they may decide to sell the aircraft as a part-out candidate and cash in on any maintenance reserves, rather than invest in restoring the aircraft to a condition for a further period of operation.
A downside or risk with part-out is that as the fleet for a type diminishes in numbers, the quantity of material and spares from dismantled aircraft increases, while demand from a small fleet reduces. Those aircraft were in Spanair livery, with Spanair seats and Spanair internal trim. Aircraft might be parted out at an even younger vintage if the owner thinks this approach will offer the best return on investment. Gregory says that the average age for A family part-out candidates is about 18 years, but that ASI has processed a number of year old examples, and even one aircraft as young as seven years.
Other aircraft will be parted out at much older vintages, as their accumulated utilization approaches operational limits of validity. For owners of younger in-production aircraft variants the part-out process is one of several options to maximize remaining asset value. Passenger-to-freighter P-to-F conversions have traditionally been considered economically viable when aircraft are years of age.
Some aircraft types are being converted at up to 25 years old in the current market. P-to-F conversions are only available for certain types, however. There are few alternatives to the part-out process for aircraft older than 25 years, should the owner consider it uneconomic to continue passenger operations.
High-demand candidates are generally relatively young airframes of no more than years of age, for which the part-out process is preferred over alternative use options, includingcontinued passenger operations or P-to-F conversion. In that field, however, you are also competing with potential buyers who want to fly the aircraft. The most in-demand narrow-body candidates are NGs including the and series, and younger A family variants including As, As and As.
Early aircraft also had different APUs and slight differences related to the landing gear. Aircraft types for which there is less demand for aftermarket spares will see less demand as part-out candidates. This might include aging types in excess of years of age that are being retired from service, resulting in a contraction in the active fleet and in many cases an oversupply of aftermarket spares. These aircraft will have few alternative options to the part-out process. This may lead to high numbers of part-outs for certain types, regardless of the lack of demand for associated spares and the resulting impact on asset values.
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