IBA analysis: despite multiple challenges, robust orders sustain aero engine market

In recent months throughout the aviation industry, there have been many issues and challenges. Aircraft engines in particular have felt the impacts of shop visit escalations, costs of ownership, inflationary pressures, and a higher cost of borrowing. Operators who have newer generation engines such as the LEAP-1A and PW1100G are feeling these impacts to a greater extent.

IBA has witnessed increases in the cost of ownership, with some cost escalations nearing double-digit percentage increases. The ownership economics of newer and more fuel-efficient engines are more favourable to airline operators, and it is therefore expected that operators will absorb the cost of shop visits in the long run. For more mature assets, IBA expects questions to be raised about the likelihood of an engine being serviced. IBA