Eyb+2011+i pad

2011
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Y O U R E N G I N E I S O U R P R I O R I T Y.

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Engine MRO outlook
Engine MRO represents the biggest part of MRO spend and the engine fleet is expected to grow
at 2.5 per cent a year over the next decade. David Stewart of industry consultancy AeroStrategy
looks at the facts and figures.

I
n 2009, there were approximately 20,500 sion but also in the coming years when the next
active air transport aircraft with 45,000 jet aerospace cycle moves into an upswing. The
engines. This fleet flew about 114 million reduced spend and the timing of this recovery
engine flying hours, and generated $15.3bn in is, of course, one of the aforementioned short-
engine overhaul spend. term challenges!
By these measures and many others, the air
transport engine market is thus one of great Engine fleet
significance. Engine OEMs and MROs are AeroStrategy and UBM Aviation together
together responsible for the performance of an produce an independent forecast of the aircraft
asset which is a prerequisite to airline reliabil- and engine fleet, and associated MRO spend,
ity and aircraft availability and a driver of fuel over the period 2009-2019. Based on this fore-
costs. It also represents the largest share of cast, the engine fleet is expected to grow at
MRO spend (see below). 2.5 per cent per annum, from 45,000 to
This article provides the numbers behind 57,500 over the next decade.
this engine market. It also highlights some of This fleet can be segmented in a number of
the key trends and challenges for the engine different ways that can inform supplier strate-
MRO supply chain, not only today in the reces- gies and focus in the coming years. For exam-

2 The Engine Yearbook 2011

Table 1
Engine OEM Fleet Size Fleet Size CAGR (%) Fleet Share Fleet Share
2009 2019 2009 (%) 2019 (%)
CFMI 15,200 23,000 4% 34% 40%
GE 9,800 13,100 3% 22% 23%
P&W 8,570 4,730 -6% 19% 8%
Rolls-Royce 6,460 8,110 2% 14% 14%
IAE 3,590 7,050 7% 8% 12%
Other 1,150 1,420 -4% 2% 1%

ple, the regional analysis of the fleets in 2009 already developed corporate, capacity, cus-
and 2019 (see Graph below) highlights some tomer support and logistics strategies for the
obvious yet dramatic conclusions. Everyone Asia region risk losing out in a significant way.
knows that the growth rates in Asia (especially A second way of segmenting the fleet is by
China and India) will be relatively high. But what engine OEM. Table 1 (above) provides the asso-
does that mean in absolute terms? The active ciated information.
jet engine fleet in Asia Pacific (including China This demonstrates (amongst other things)
and India) will grow from 9,650 in 2009 to the huge growth in the narrowbody engine fleet
15,500 in 2019 — that’s an additional 5,850 (CFMI and IAE), the growing share of the fleet
engines to support and maintain. At 4,040 represented by GE (including its share of CFMI
engines, this is larger than the absolute engine engines), and the significant decline in the Pratt
fleet growth in North America and Europe com- and Whitney fleet (excluding their share in IAE).
bined. It is clear that engine MRO suppliers and This table does not address one clarion issue:
others in the related supply chain who have not “What about the potential re-engining of the A320
and the 737?” This subject that might have
greater clarity by the time this article is published
and read. The data assumes that re-engining
does NOT occur, and by so doing, shows how mas-
sively significant for some OEMs this re-engining
Engine fleet growth by region 2009-2010
decision is. For example, if the A320 family is re-
(region, CAGR and absolute increase) engined with a Pratt & Whitney GTF (geared tur-
bofan) and a CFMI alternative option (an outcome
70,000 that seems increasingly likely at this time), how
different would the above table look for Pratt &
Whitney and IAE? Very different is the answer.
60,000 A third important segmentation approach is
by maturity of the engine. Using the following cat-
egories: in production (e.g., CFM56-5B, CFM56-
50,000
7, CF6-80E, GE90); future (e.g., GENX, Trent
XWB, SAM146); mature (e.g., CF6-80C2,
40,000 PW2000, RB211-535); and old (e.g., JT8D, CF6-
50, RB211-524). Graph 2 (p6) shows the
emphatic switch in the engine fleet towards the
30,000 “in-production” and “future” categories. In
2009, these represented 50 per cent of the
fleet, and in 2019 this share grows to 78 per
20,000 cent. The old fleet declines at 10 per cent per
annum, the mature fleet at four per cent per
annum. What’s the implication for the supply
10,000 chain? For those suppliers with a portfolio
focused on mature and old engine types, it’s
clear that the challenge of how to get capability
0
on and access to newer engine types is now
2009 2019
looming very large.
Rest of World, +3.3% p.a. + 2,800 engines Europe, +1.5% p.a. + 1,940 engines
MRO spend outlook
Asia-Pacific, +4.8% p.a. + 5,850 engines North America, +1.3% p.a. + 2,100 engines
The 45,000 engines and 20,500 air trans-
port aircraft generated an MRO market in 2009


worth $42.7bn, a decrease from the 2007
Table 2
peak year of spend of about $45bn. This
decline was driven primarily by the permanent
parking of aircraft resulting from the high fuel Region Engine MRO Engine MRO Absolute
price and airline failures in 2008 and from the
recessionary pressures of 2008 and 2009 that
Market 2009 Market 2019 Growth ($B)
resulted in declining fleet-wide aircraft utilisa- ($B) ($B)
tion. North America 5.3 6.0 0.8
How does this MRO spend break down? The
Europe 4.5 6.0 1.4
largest segment is engine overhaul at $15.3bn
(36 per cent), followed by component overhaul Asia-Pacific 3.4 6.9 3.5
($9.4bn, 22 per cent), line maintenance 0.8 1.7 0.9
Middle East
($8.7bn, 20 per cent), airframe heavy mainte-
nance ($6.3bn, 15 per cent) and modifications Rest of World 1.4 2.0 0.6
($3bn, seven per cent). That is, engine over- TOTAL 15.3 22.5 7.2
haul, defined as off-wing engine maintenance
activity only (i.e., excluding engine manage- sation is expected to increase as airlines seek
ment and on-wing activity) is the biggest driver to improve asset utilisation and reduce unit
of airline MRO spend. cost. The associated forecast shows annual
What are the expectations for growth? engine utilisation growing from 114 million
Whilst the total MRO market will grow to $58bn hours to 174 million (4.3 per cent per annum).
in 2019 at 3.2 per cent per annum (in constant Once again, the engine-related MRO spend
2009 $ terms), engine overhaul is forecast to information can be usefully segmented to illus-
grow at above this rate, at four per cent per trate or re-emphasise the challenges for the
annum, to $22.5bn in 2019. This growth rate engine MRO supply chain.
is higher than that for the engine fleet (2.5 per The MRO spend regional analysis (Table
cent per annum) because average aircraft utili- 2) reinforces and exacerbates the previous

The Engine Yearbook 2011 5

suppliers. OEMs have the ability to sell long-
term MRO support deals at the point of air-
Share of engine fleet by engine maturity, 2009 and 2019 craft purchase and they control access to
technical data, documentation and many
100% parts. They can also be more flexible on mate-
rial pricing within their MRO offers, should
they choose to do so. As evidence of the mar-
80% ket strength of OEMs, one just has to observe
the market penetration of the Rolls-Royce
TotalCare offer on their own engine models,
especially the Trent family.
60% So the 2019 information from this segmen-
tation analysis (by engine maturity) raises an
important challenge for airlines - they need to
40% develop strategies that enhance competition
and/or help protect/reduce costs, especially
on the larger, newer engines where OEMs tend
to have a stronger market position. The ability
20% of the engine OEMs to raise/escalate their
prices even in the midst of the current reces-
sion remains an open and regular complaint of
Future
0% many airlines.
Old One segmentation approach obviously not
Mature yet discussed is by engine type. In 2009, there
were five engine families that generated more
In Production than $1bn in demand (in descending order of
market size): CF6-80C2, V2500, CFM56-3,
PW4000 (all versions), and CFM56-7. In 2019,
there are seven engine families with MRO
observation on the importance of Asia in demand greater than $1bn (in descending
the future. order of market size): V2500, CFM56-7,
Asia Pacific accounts for almost 50 per cent CFM56-5B, GE90, PW4000, CF6-80C2 and the
of the absolute growth in engine MRO spend CF34.
Table 3 and the region will be a larger engine MRO mar- It is staggering to note that the largest three
ket than North America and Europe in 2019. engine markets, those that power the A320
This is driven not just by the fleet growth, but and 737NG, will alone generate a combined
Measure 1995 2009 also by the age demographics of the fleet 2019 market size of over $9bn! This is a huge
already in operation. potential market, and this once again highlights
Market
A different segmentation is by aircraft cate- the dramatic impact that a re-engining decision
Size ($B) 6.5 15.3
gory: regional jet engine (e.g. CF34, AE3007), of the A320 and 737NG (with a discussed
In-House
single-aisle (e.g., CFM56-7, V2500) and twin- entry into service of about 2014/2015) will
Share 54% 23%
aisle (GE90, PW4000, Trent family). Whilst twin- have on the future breakdown of the market.
OEM aisle engines account for 27 per cent of the
Share 13% 43% fleet, such engines generate some 45 per cent Engine MRO supply
Independent of the engine MRO spend, simply because they There are four main categories of supplier in
Share 14% 19% are larger and more expensive to maintain. engine MRO — the OEMs, in-house airline
Airline Third Regional jet engines represent 14 per cent and shops, airline third-party providers (e.g., Delta
Party Share 19% 15% six per cent of the fleet and spend respectively, Tech Ops, LH Technik, Iberia) and independents
Outsourced whilst for single-aisle, the numbers are 59 per (e.g., MTU, Standard Aero and ST Aerospace).
Market ($B) 3.0 11.8 cent and 49 per cent. This is of particular In 2009, engine OEMs held a 43 per cent
importance to airlines because, unsurprisingly, share of supply. This includes OEM-based joint
there is less supplier choice on the larger venture suppliers such as TAESL, SAESL and
engines and therefore typically less competi- HAESL. Some 23 per cent of engine MRO is
tion. conducted in-house, 19 per cent by independ-
It was pointed out in the earlier fleet analy- ents and 16 per cent by airline third parties.
sis that “in-production” and “future” engines Note that in this calculation, where, for exam-
will account for 78 per cent of the fleet in ple, LH Technik overhauls engines for
2019. The same is roughly true for engine Lufthansa, this is considered in-house.
MRO spend. And on newer engine models, it There has been a significant shift in this
is also valid to say that engine OEMs have a supply breakdown over the last 15 years (see
competitive advantage over other third-party Table 3).


Since 1995, OEMs have increased their
share of the market by 30 percentage points, Engine MRO market in recession
primarily by taking work from “in-house” supply, The recent recession has obviously
the proportion of which has dropped by 31 per- impacted spend on engine MRO. Airlines have
centage points. Interestingly, the combined parked many of the old maintenance intensive
share held by airline third parties and inde- aircraft such as the 737 Classic and they have
pendents remains virtually unchanged at 33-34 reduced overall aircraft utilisation to better
per cent. As a result of this change in purchas- match capacity with demand.
ing behaviour by airlines, the “available” or out- Given the imperative to reduce costs, air-
sourced market has grown at just over 10 per lines have sought many other ways to reduce In 2009, there were
cent per annum over this period, to $11.8bn in their engine MRO spend as well. Examples
approximately 20,500 active
2009. include: a reduction in workscope for shop vis-
This outsourcing trend will likely continue its; where possible, more repairs and less air transport aircraft with
into the future, albeit not at such a fast rate as replacement of expensive parts; deferment of 45,000 jet engines. This fleet
historically. The reasons for this are threefold. the replacement of the very expensive life-lim-
First, as airlines move into new aircraft, the ited parts and use of short-stub engines;
flew about 114 million engine
associated new engines are becoming increas- greater leverage of spare or surplus engines in flying hours, and generated
ingly reliable and the cost to establish overhaul lieu of an overhaul; and of course, some air- $15.3bn in engine overhaul
capability is getting higher. These two factors lines have sought to renegotiate their MRO con-
make the business case for in-house capability tracts.
spend.
more and more difficult to justify. Second, air- All these changes in behaviour have meant
lines today are focusing more on their “core that engine overhaul suppliers, depending on
business” of flying passengers. And engine their engine and customer portfolio, have seen
maintenance to most airlines is non-core. revenues decline on average by 10-15 per cent.
Third, a viable supply base exists for many When will recovery occur? This is ultimately
engine types, so airlines can and should lever- driven by the financial health of the airline
age this opportunity. industry, which in turn is very dependent on


economic growth and fuel prices. The current Despite this, PMA remains a strategic tool
outlook is for relatively slow global economic for airlines to use in the face of increasing
(GDP) recovery in the order of two to three per prices or poor parts availability from OEMs.
cent per annum, with fuel prices being quite Therefore, it is expected that adoption of PMA
high at over $80/barrel. In this case, 2010 will will recover and increase, especially in the air-
likely be a year of low single digit percentage frame components and interior parts of the air-
growth, with recovery really taking hold in craft.
2011. A number of key challenges have already
However, a worst case scenario would be been raised. In particular, there is the growing
another drop in economic growth and continu- importance of the Asia Pacific market and the
ing high fuel prices. In this event, the engine perceived threat (to costs) of more limited
MRO market is likely to remain depressed for a sources of supply on the new larger engines
while longer. In an upside scenario, where the coming into service in the next decade. In addi-
It is staggering to note that the expected slow economic growth continues, and tion, the size and growth of the single-aisle
the fuel prices drop below $80, the market engine MRO market (A320/737NG) will have
largest three engine markets, would probably see a quicker and more “V- been an expected foundation for many suppli-
those that power the A320 and shaped” recovery. ers’ revenue prospects over the next decade. A
737NG, will alone generate a decision to re-engine the A320 and the 737NG
Trends, challenges and would change the long-term outlook for the cur-
combined 2019 market size of opportunities in engine MRO rent engines significantly.
over $9bn! This is a huge No engine MRO market review would be Opportunity obviously also exists. Market
potential market, once again complete without a comment on the status and recovery is expected in the not too distant
development of PMA. The recession has seen future and robust growth of four per cent per
highlighting the dramatic the use of PMA decline by some 17 per cent annum (in constant $) is forecast. This com-
impact that a re-engining since the 2007 peak. There are a number of bined with an increase in outsourcing means
reasons for this, including: airline use of buffer an even higher growth rate in the available mar-
decision of the A320 and
stock rather than buying of inventory; more ket will occur. However, this higher market
737NG will have on the future repairs rather than replacement of parts; park- “availability” will only be realisable and acces-
breakdown of the market. ing and cannibalisation of the mature aircraft sible to airline third-party and independent
fleets where PMA had a higher penetration of MROs if they develop counter-strategies to the
material content; reduced airline resources threat of OEM-based long-term MRO contracts
available to the PMA approval process; and last signed at aircraft delivery.
but not least, OEM defensive measures. This Engine MRO is a large, global, competitive,
latter point can be illustrated by GE/CFMI’s technologically and service demanding market.
agreements with potential adopters/users of The critical long-term threats and opportunities
PMA, the independent suppliers such as are evident for all to see. The winners will be
AVEOS and ST Aerospace. This has success- those who take action, develop the appropriate
fully given GE/CFMI greater influence over the strategies and build the right capabilities, part-
parts/material supply chain. nerships and portfolio to succeed. I


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An aero engine’s life cycle can be divided into three main stages: the financial, management and
trading phases. Careful and far-sighted management is necessary to balance maintenance cost
against operational risks whilst maintaining maximum asset value as the engine progresses
through these different periods.

Managing engines wisely
E
verything is rosy during the ‘honey- processes are safely and adequately working), best life-limited part (LLP) management phi-
moon period’, the first years of an aero the operator has no more engine management losophy.”
engine’s life cycle and main part of the responsibility.
initial financial phase. The power plant has But this sweet, uncomplicated life typically Power-by-the-hour
been freshly delivered from the OEM and comes to an end after approximately seven A power-by-the-hour (PBH) or total support
mated with its original operator who will gen- years; although this does depend on the type agreement with the OEM or an MRO provider is
erally be able to enjoy its daily faithful, rev- of aircraft and its utilisation. At this point the one option for the operator. This would allow con-
enue-creating service without worrying much engine is taken off wing for its first scheduled tinued flying without assuming the responsibility
about prolonged and expensive mainte- maintenance shop visit. The OEM’s warranty of balancing maintenance costs against opera-
nance. Premature engine removals for com- begins to expire in individual areas, and its tional risks and determining the maintenance
ponent deterioration should be covered by financial support starts to dwindle. The engine planning. Normally, the engines stay in the serv-
the OEM as part of its product warranty, and becomes ‘adolescent’, as David Garrison, MD ice of the initial operator as there is only limited
even foreign object damage (FOD) events engine and component maintenance at Delta aircraft remarketing taking place at this point in
might fall under a separate insurance policy. TechOps in Atlanta, US, puts it. For him, the time. The operator can pay the OEM/MRO an
Typically, the OEM will also make guarantees operator has to take on more responsibility for individually arranged, flight hour-based rate for
for fuel consumption, piece-part life and reli- the power plant’s maintenance planning in this their technical support services and concentrate
ability, especially on new-generation equip- second part of the financial phase. Garrison on its main business of providing air transport.
ment, and possibly even commit to cost per states: “During this phase one will be actively For example, Delta TechOps’s PBH contracts
flight hour and/or flight cycle. Apart from managing the unscheduled engine causes and usually include fleet removal forecasting, service
ensuring compliance with the regulatory determining the engine’s true capabilities bulletin modification and inspection recommen-
requirements and keeping a moderate level based on the current design and the owner’s dations, on-wing engine condition monitoring,
of technical oversight (to make sure the [airline or lessor] operating parameters. and the development of a maintenance pro-
required maintenance and operational During this phase one is also analysing the gramme, according to Garrison.


During the initial ‘honeymoon’ period of an engine’s life cycle, its maintenance is largely determined by the OEM’s product warranty policy and
guarantees, and the operator/owner does not need to manage an engine plan.

However, even apparently comprehensive ments,” explains Steve Froggatt, engineering objectives of its owner, if it is a leased engine,
packages do not necessarily cover all eventual- manager at TES Aviation. “We won’t always go is the first step for any technical management
ities that might concern an aircraft operator or for time and material if the power-by-the-hour team before determining the future mainte-
owner. “One comment about total support is contract makes more sense. It all depends on nance plan.
that all too often it is not really total support,” the engine, operator, any specifically harsh
remarks Karl Gibson, operations director of operating area or condition.” Management phase
TES Aviation, an aero engine management com- For Abdol Moabery, CEO and president of GA This becomes increasingly important as the
pany based in the UK. He highlights that total Telesis, an aircraft asset management firm, engine progresses from the financial phase
support and PBH agreements always carry component supplier and maintenance provider into the management phase. By then the pow-
exclusions and might not cover certain work; in Fort Lauderdale, Florida, the issue comes erplant is between 12 and 15 years old, may
FOD removal as an example. These extra-con- down to whether the operator wants to make have transitioned from one operator to the
tractual maintenance events have then to be regular payments to a PBH/total support next, its PBH/total support contract may be
accomplished on the basis of their individual provider for the maintenance in advance or pay expiring, and it will need to come off-wing for its
(man hour) time and material cost require- for the individual events as they come along. second, third or fourth shop visit. All product
ments. In that case the operator incurs both “The provider of that [PBH/total support] serv- warranty and guarantees have finally expired,
the cost of the regular PBH/total support pay- ice is accumulating cash for a 10 or 15-year and the maintenance plan is no longer gov-
ments, whether any regular maintenance work programme. Some airlines view that cash as erned by the OEM’s product and repair devel-
has actually been done or not, as well as the important to their business [now]. So they opments. There will be a range of alternative
individual time and material-based payments don’t want to pay up front and would rather just PMA parts and DER repairs available on the
for the additional work. Hence Gibson argues do it as time goes by.” market, which will give the operator/owner
that, in order to forecast the entire MRO expen- Whatever decision is eventually made, it is some choice to tailor the future maintenance
diture for an engine over a given period of time, of fundamental importance to get a clear under- plan to its individual needs. “The management
the operator has to make an analysis of likely standing of the full maintenance cost that is phase is where most change is going to take
time and materials cost in the first place, irre- likely to be encountered throughout the pro- place within an engine and its value,” states
spective of whether the company then decides posed service period for the engine. Although Froggatt. “The management decisions one
to sign a PBH/total support contract or not. these expenditures can vary substantially makes at that particular point, for a number of
This does not mean that a PBH/total sup- between different operators and equipment, shop visits, is going to dictate the residual
port agreement won’t still be the best option. they can nevertheless be predicted with great value when one gets towards the trading phase
“We look at what is best for our customer’s precision over long periods of time. Analysing [when the engine will eventually be disassem-
requirements and do studies across a number an engine’s remaining life cycle in light of its bled to serve as a parts source]. As the lessor,
of maintenance cost per flight hour agree- operational requirements and the financial one is looking more into the asset value,


deterioration can be expected in terms of both
extent and rate. Establishing the fuel flow and
exhaust gas temperature (EGT) parameters
will allow the management team to outline an
initial overhaul strategy, according to
Moabery. “As turbine blades get older, the
wear starts to cause EGT margin degradation,
and the engine will very quickly move from a
strong performing engine to one that operates
with no EGT margin.”
Once all these parameters have been deter-
mined, it becomes possible to predict which
maintenance tasks will be necessary in the
future, what this will cost, what options the
operator will have to control its spending, and
how this might be affected by additional,
unscheduled maintenance. “We run those
engines forward on our system which allows us
to forecast all the events. We would work-scope
each engine individually as a paper exercise
and identify what the costs were against the
critical elements within that work scope, what
the material costs would be based on the
material standard that is in there [the engine],”
explains Gibson. “We would include all the
unscheduled events that could potentially hap-
pen, lease costs, everything ... and we would
give them effectively what the cost per hour of
their operation would be.”
If it is a leased engine, the interests between
the operator and owner are likely to diverge as
indicated above. The airline might only be con-
tractually obliged to release the engine with a
certain life left on it at the end of the lease
agreement. This would allow the company to
minimise the workscope accordingly to reduce
its costs during the lease period. On the other
Trading phase: when the value of the individual parts and components exceed the book value of a hand, however, the lessor will be looking at the
complete engine, it is teardown time and the asset will serve as a spare part source. cost of operation over the entire ownership
because one is looking at the end and what period, which might go long beyond the original
one wants to do with the asset. The operator, operator’s lease agreement. The lessor will want
specifically, is looking at the cost per hour, to enhance the workscope as much as possible
because that’s what it is all about to turn a in order to maintain a high asset value. This
profit.” would make it more attractive and marketable to
The main factors in the assessment of an other operators who might lease the engine in
“The risks of operating PMA engine’s remaining life cycle, which will indi- the future. The two parties have then to find
some common ground to keep the cost per hour
parts are vast. The risks are cate how long the engine may be able to stay
on-wing until the next shop visit, are aircraft of the engine at a level that is acceptable for
calculated over a fleet of utilisation, the status of the LLPs and their both. If the lessor demands a technical standard
engines. So in the case of an remaining flight hours/cycles, the mainte- that is significantly higher than what is neces-
sary to the operator, one solution could be that
airline with a vast fleet, one nance history, and the airworthiness directive
the lessor makes a contribution to the mainte-
(AD) status. If the analysis is performed from
can look at that risk and an operator’s perspective who has leased the nance cost.
decide it is worth doing. But engine, the length of the proposed service The use of PMA parts and DER repairs,
period is another major determinant. External instead of the standard OEM material and
the small operator may look at processes, is clearly one, if not the, most impor-
engine management consultants are typically
it and say, ‘for the cost savings engaged in contracts over three or five years. tant and powerful means to reduce engine main-
that I save, it’s not worth it’. Engine trend monitoring data at different tenance costs. However, while their use has
power settings (usually idle, take-off and been widely established throughout Western
— Abdol Moabery, CEO and Europe and North America, this is not neces-
cruise) will provide a clear picture of the
president, GA Telesis power plant’s current performance and what sarily the case in all other regions. PMA parts


The use of PMA parts and DER repairs instead of the standard OEM material and processes is one of the central questions when an engine enters the
management phase and the future value strategy is determined.

can become an obstacle when trying to find a an overhaul. The engine’s technical standard capacity, the older, less efficient aircraft are the
lessee for an overhauled engine, for example, in and performance has been surpassed by its first ones to stay on the ground. “A good exam-
China and India — two future growth markets. younger counterparts in the fleet, and possibly ple right now is the CFM56-3 model [for 737
But even within the boundaries of jurisdic- even by new-generation equipment that has Classics], where there are so many spare
tion of the FAA and EASA, the cheaper alterna- emerged in the meantime. Furthermore, there engines available in the market that an operator
tive repair materials and processes might not will be an increased number of other engines of may decide to run off ‘green-time’ on a leased
always pay off either. In light of the increased the same type and similar age on the market, engine as opposed to putting in $2-3m to repair
operational risk of using PMA parts and DER which have been phased out by other operators the original engine,” reports Moabery.
repairs, the potential cost savings might be and have consequently brought down engine While the deferral of maintenance and
considered much less tempting for an airline lease rates and spare part prices. Not only using-up of surplus engines will help to drive
with, for example, 10 aircraft than a carrier with does it then become cheaper for the operator older equipment permanently out of the mar-
a fleet of 100 aircraft. “The risks of operating to swop an engine against a leased one rather ket, it would be a short-sighted waste of mate-
PMA parts are vast,” believes Moabery. “The than to repair or overhaul it, indeed there rial and finances to take advantage of aircraft
risks are calculated over a fleet of engines. So comes the point where the value of the individ- capacity cuts in the current economic climate
in the case of an airline with a large fleet, one ual parts and components exceed the book and apply the practice to younger equipment
can look at that risk and decide it is worth value of the complete engine. It is teardown too. Garrison warns: “In the airline industry,
doing. But the small operator may look at it and time at this point and the engine will serve as economic cycles are a way of life and have a
say, ‘for the cost savings that I save, it’s not a source for spare parts. significant impact on an airline’s budget sensi-
worth it’. If I have a major engine failure or a The dynamics of the trading phase are sub- tivities. The airline industry is a cash hungry
catastrophic event, then all of those savings ject to the economic conditions at the time. In business and during an economic downturn,
are wiped out by one event.” periods of growth, when queues before airline airlines work hard to preserve cash. This
check-in desks and OEM sales offices are long, stance can make engine management very dif-
Trading phase the service lives of older aircraft are stretched ficult, because you will need to invest in your
At approximately 20 years of age, the too, and consequently lease prices for older fleet during the shop visit to make sure that
engine enters into the trading phase, the final engines with some residual ‘green-time’ are sta- you build in the goodness to obtain your engine
part of its life cycle. By this time, the value of ble. ‘Green-time’ is the available period during run time and reliability plan. Airline customers
the entire aircraft is mainly driven by the engine which an older engine can remain in service who do not maintain the investment discipline
value. Ironically, however, the book value of the until its last maintenance records expire and it during the economic downturns can expect
power plant in itself is coming down so far at will be torn down. Conversely, when the industry their cost per hour and total cost to increase in
this point that it no longer warrants the cost for goes into a downturn and airlines are cutting future years.” I


Spare engine financing
Just as the aviation industry was showing signs of economic recovery the ash cloud descended
and traffic figures slumped. It is hardly surprising that there is a reluctance to invest but there
are, as Jon Sharp, president and CEO of Engine Lease Finance Corporation, writes, some reasons
for optimism.

T
o say that the second quarter of 2010 did values. Reduced flying means less MRO work
not present a great outlook for aviation and less demand for spare engines; all the
finance is an understatement. Last year engine lessors have equipment available for
saw the largest decline in air traffic since WWII. immediate lease and rentals have dipped
That was already on top of a massive traffic accordingly.
decline in 2008. Record losses were sus- Longer-term, the leasing companies have
tained, according to IATA, and prospects remain had to accept that certain aircraft and associ-
poor for this year. Airlines reacted quickly by ated engine types have suffered a permanent
cutting capacity: routes were culled and fre- reduction in value, which demands a write-down
quencies reduced; new aircraft deliveries, on their balance sheets. However, new aircraft
where possible, were delayed or even can- types are overrunning on costs and timescales,
celled; and large quantities of existing aircraft which prolongs the valuable life of some older
were parked in the desert, with the emphasis aircraft types, at the same time as introducing
on parking the less efficient aircraft and an more uncertainty into residual value prediction.
obvious attendant downwards impact on their As if that was not enough, oil prices remain


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Lessors like to receive maintenance reserves as the airline burns value off the engine asset
volatile thereby introducing yet more uncer- and cycles of the economy, both at regional
tainty into residual values in the shorter term and global level, by absorbing some of the
(and airlines face the risk of making losses pain when times are bad.
solely from backing the wrong hedging policy,
Leasing companies have had which does not help them or their lessor part- Air finance and engines
ners). Small wonder then, there has been a flight
to accept that certain aircraft of capital from the air finance industry with only
Through capacity cuts, load factors were
and associated engine types maintained in a reasonable range, but yields a few of the cannier banks hanging on in there.
have suffered a permanent suffered badly; the special offers made by the Even now, with signs of global economic recov-
air carriers to attract the flying public back ery quietly but steadily emerging , the upturn
reduction in value, which into their seats meant that prices were for the airline industry has been confounded by
demands a write-down on their slashed and revenues suffered, although the ash cloud hanging over much of Europe;
balance sheets. However, new there is now evidence that fares are creeping the scientists tell us that the eruption may go
back up to sustainable levels on key routes on for many months and we are in for a period
aircraft types are overrunning such as the North Atlantic. The airlines need of randomly disrupted air travel. In the second
on costs and timescales, which these revenues and their suppliers — the half of 2010 we are faced with a crisis in the
leasing companies — are relieved to see it euro zone and the concern that Greece’s eco-
prolongs the valuable life of
happening; the airlines in the Northern hemi- nomic problems will become contagious, lead-
some older aircraft types, at sphere at least need to earn substantial sur- ing ultimately to a double dip world-wide
the same time introducing pluses in the summer months to see economic recession. The industry continues to
themselves through the lean winter months. stagger through these and similar problems
more uncertainty into residual and reluctance to invest continues.
It is during the winter that defaults on rental
value prediction. payments are most frequent, due to cash The real problems with air finance have
shortages. Most leasing companies are hav- been largely disguised by the continuance of
ing to deal with delinquencies and even very low interest rates thanks to the interven-
defaults or bankruptcies — as such, being tion of various governments following the
between the banks and the airlines, they pro- global credit crunch. The banks that have
vide to the industry an essential mid- supply funded the industry have done so because they
chain buffer that helps modulate the peaks can charge high margins as a result of low


underlying interest rates; low base rates will
not last forever, however, and without a struc-
tural overhaul of the financial system, the
industry will only struggle on. Some banks
have now returned to the fray and some
strongly funded leasing companies are still writ-
ing new business, but there remains a funding
gap for new deliveries of aircraft and engines.
There is also the small matter of several very
large leasing companies looking for a buyer.
The banks, not surprisingly, favour loans
guaranteed by the Export Credit Agencies
(ECAs), who have hugely increased their partic-
ipation in the last year or two (ECGD [UK export
credit agency] will probably guarantee twice as
much in 2010 as they have in previous years)
but the ECAs cannot alone sustain this gap in
aircraft and engine financing markets, nor can
the Original Equipment Manufacturers (OEMs).
The leasing companies are next most attractive
to banks, who by lending to a lessor against a
specific asset will have a clear mortgage on an
identifiable piece of metal that is being man-
aged by the lessor to maximise its future value.
Thus the lessor is an essential part of the sys-
tem, yet current OEM behaviour is actually dis-
couraging to this form of external finance right
at the time when the market needs it most.
Manufacturers such as Rolls-Royce are becoming increasingly concerned with aftermarket support.
OEMs muscle in on the aftermarket
To explain: the OEMs spend vast amounts who now have to review OEM risk as well as air-
of R & D in developing a new engine and need line balance sheet risk.
to recover those costs not just from new sales,
but from the lifetime spares sales and MRO Secondly, there are concerns about the
services. They are understandably getting portability of the fund. When Airline A has fin-
more and more possessive about their after- ished his lease, does the OEM pay the total Lower labour costs available in
markets, and preventing the use of non-OEM remaining amount of the fund to the lessor and Asia Pacific and South America
parts and repairs (PMA and DER) whilst can the lessor transfer the benefit to his next
squeezing those leasing companies and MROs customer, Airline B? Possibly not, but even if
make them attractive regions
(Maintenance and Repair Organisations) and so, is the amount collected enough, given that to develop MRO facilities with
parts suppliers who are not owned or part- (a) the hourly and cyclic rates will probably have all the associated
owned by them. Fair enough. Unfortunately been set at a concessionary level to win a
the increasingly common OEM inclusive main- sales campaign, (b) with respect to engines at infrastructure. China, Japan,
tenance packages are not friendly to non-OEM least, depending on the package structure, the Brazil, Russia and other
owned leasing companies and so reduce the level of payments may refer to a first run and
countries with aspirations to
amount of finance available from them. The so not reflect true averaged lifetime cost and
problems leasing companies have with OEM (c) the two airlines A and B may have very dif- develop commercial aircraft
‘Inclusive Care’-type maintenance packages ferent operational profiles meaning that rate and engine manufacturing have
fall into three categories: may not be enough overall and Airline B would
have to pay ‘catch-up’. Some aircraft inclusive
an opportunity for a fresh start
The first is the matter of security. The les- maintenance agreements do not even separate and should take note and think
sor likes to receive maintenance reserves as out the rate for engines from the total. about the structure of their
the airline burns value off the lessor’s asset, to
offset credit risk. With an inclusive mainte- Thirdly, there is the choice of MRO
industry and how they
nance package, the OEM and not the lessor, provider. With an OEM maintenance pack- interface with the financial
receives the reserves and holds them in a age, there is no choice and the asset has to community.
fund, so the lessor’s security is at least dimin- go back to the OEM or its nominated service
ished or even becomes non-existent. Also the provider. Airline B who wants the available
lessor is exchanging airline risk for OEM risk, aircraft/engine from the lessor but is already
admittedly in some cases a better credit, but it locked in to a long-term maintenance pro-
is the concentration of such risk in one MRO gramme with a third-party provider will find
provider which is worrying to credit committees his choice of equipment restricted and the


lessor simultaneously find his re-marketing region, with growth in China continuing but at
options restricted. a slightly less frenetic level (which does give
So the OEMs (engine OEMs in particular), by more confidence of avoiding a nasty bubble).
increasing their efforts to sell inclusive mainte- There is much press about the new aircraft
nance packages are driving away the remaining types coming out of the Asia Pacific region.
The ECAs cannot alone sustain independent sources of finance for their prod- Abu Dhabi is investing heavily in the MRO sec-
ucts; does this mean they are moving to a tor not only in the Middle East but also in the
the gap in aircraft and engine West. Lower labour costs available in Asia
model where they keep the engines they pro-
financing markets, nor can the duce on their own balance sheets? Is this Pacific and South America make them attrac-
OEMs. The leasing companies really desirable? The trend is certainly grow- tive regions to develop MRO facilities with all
ing and some OEMs are talking about selling the associated infrastructure. China, Japan,
are attractive to banks, who by ‘power only’ for the next generation of engines. Brazil, Russia and other countries with aspira-
lending to a lessor against a These new engines will be designed to have a tions to develop commercial aircraft and
engine manufacturing have an opportunity for
specific asset will have a clear fixed life with all LLPs at the same limit as the
expected power restoration interval and an air- a fresh start and should take note and think
mortgage on an identifiable line would pay a fixed amount for the engine for about the structure of their industry and how
piece of metal that is being that period of operation, before exchanging it they interface with the financial community.
for another one, upon payment of another fixed The Chinese and Middle East airfinance mar-
managed by the lessor to kets may well be largely be captive to their own
amount. So there is never the matter of the
maximise its future value. Thus ownership of the engine passing from the OEM. banks and Sovereign Wealth Funds, but what
the lessor is an essential part Nothing for a bank to have security over and the Western leasing companies do have is a
nothing for a lessor to own. I also wonder how wealth of expertise and it is that which can be
of the system, yet current OEM allied with the new wealth to create new, suc-
an ECA can participate in such a structure.
behaviour is actually The inevitable conclusion is that new style cessful partnerships.
discouraging this form of relationships between OEMs, the financial com- So, a new business model is needed. A
munity and MRO organisations are essential, simple conclusion is the airfinance industry
external finance right at the not just for the benefit of those three parties, needs new, fresh thinking alliances between
time when the market needs it but also for their customers, the airlines. the airlines, lessors, OEMs and MROs on the
one hand and new alliances of old expertise
most. Whatever signs of economic recovery in the
aviation industry there are have been led by and new money on the other. A really enlight-
the Middle East traffic growth, albeit from a rel- ened approach would be to combine the two.
atively small base, and in the Asia Pacific Somebody has to make this happen. I


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The evolution of low-emissions
combustion chambers in
commercial aircraft engines,
1990 — 2010
During the 1990s the aerospace industry was forced to confront the world’s growing
environmental awareness, which manifested itself in tougher certification requirements for
aircraft engines and the introduction of local environmental regulations, particularly in Europe.
David Cook, President of ASM Consulting, was sales director at CFM International from 1989 to
2001 with account responsibility for Northern Europe. Through sales campaigns at Austrian
Airlines, Swissair, SAS and Finnair he saw firsthand how the aero-engine industry responded to
demands for cleaner engines which, in turn, explains why the industry is so well-equipped to
meet the challenges facing a new generation of commercial aircraft engines.

A
s mass air travel started to develop in responsibility of the Committee for Aviation at airlines such as SAS, Braathens SAFE,
the 1970s the public, particularly those Environmental Protection (CAEP), established Finnair and Icelandair, I came to understand the
living around airports, became more and in 1983, which published its first set of regula- fragile nature of the Scandinavian environment
more vocal in their concerns about aircraft tions (CAEP 1) in 1988. and how much it is under threat from external
noise and atmospheric pollution. Images of After training and serving as a technician in sources of pollution such as large power sta-
earlier generation four-engined jets heading for the Royal Air Force, followed by a number of tions in other parts of Europe. While they could
distant destinations with engines bellowing years with a British regional aircraft manufac- not do much about external sources they were
long plumes of smoke are emblematic of this turer, I was recruited by Snecma to join the CFM determined to protect themselves from internal
period. By the late 1970s the International Civil sales team with specific responsibility for sources, developing the ‘bubble’ concept
Aviation Organisation (ICAO) decided to act by Scandinavia. It quickly became apparent that whereby any new industrial project was required
bringing in limits for aircraft engine noise and environmental issues were a principle concern to account for all emissions generated by its
polluting emissions, defining certification stan- for my new customers, one clue being that the activity. It was as a result of this philosophy that
dards for Nitrous Oxides (NOx), Unburned president of the one-time Swedish domestic air- the world’s first local emissions legislation was
Hydrocarbons (UHCs) and Carbon Monoxide line Linjeflyg had his environmental advisor applied to Swedish airports in 1990, limiting
(CO). These standards were put under the located in the office next to his! Meeting people NOx emissions emanating from all aspects of


the airport’s activities and initiating charges for
aircraft movements dependent on the aircraft
engine’s certified NOx emission levels. While
ground vehicle activity, in particular private cars,

NOX emission levels (g/kn thrust - LTO cycle)
was clearly the main source of airport NOx CAEP 4 limits
emissions this concept was also aimed at cur-
tailing, or at least penalising, movements of air-
80 CAEP 6 limits
craft with high NOx emitting engines.
At around about the same time Austrian
Airlines and Swissair launched an evaluation to
replace their ageing DC-9 fleets, finally select- Conventional combustors
ing the Airbus A320-family as their preferred 60
airframe. This gave them an opportunity to eval-
TAPS / TALON combustors
uate both CFM56-5B and IAE V2500-A1
engines in a competitive selection process. As DAC combustors

Switzerland had recently followed Sweden’s 40
example by introducing airport NOx emissions
? I?
taxes the message from the airlines was clear onX PSI
Tal TA
— all other things being equal, they would Early turbofan engines
select the engine with the lowest certified NOx 20 CFM56-5B4 family
emissions. The gauntlet had clearly been CFM56-7B26 family
thrown down and it was up to the aero-engine IAE V2527-A5 family
industry to respond.

Controlling aircraft emissions 10 20 30 40 50
It is perhaps worth reminding ourselves
what emissions are produced by an aircraft Overall pressure ratio (OPR)
engine and how they may be controlled. As pre-
viously mentioned, those emissions controlled
by the engine’s certification process are NOx, As is often the case with anything to do with tively rich, providing high power and good fuel
UHCs, CO and smoke. Limits for these emis- aircraft engines, the combustion chamber economy but generating large amounts of UHC
sions are defined by ICAO dependant on the designer is faced with a multitude of conflicting and CO at low power settings. These pollutants
engine’s overall pressure ratio (OPR) and meas- priorities. He must make sure that maximum would be burned off as they moved into a rela-
ured through what is called the landing and thrust is produced at takeoff, that maximum tively lean combustion environment when addi-
takeoff cycle (LTO) ie: the sequence of events fuel economy is achieved at cruise, that the tional air was introduced further down the
beginning with start-up and taxi out to the end flame does not go out at high altitude or in combustion chamber. At high power settings
of the runway, engine acceleration to takeoff heavy rain ... and, of course, that the engine the NOx produced in this rich burn process
thrust, through the takeoff run, up to 3,000 meets its environmental certification require- would be limited by quickly cooling, or ‘quench-
feet on the climb-out, then from 3,000 feet on ments. In order to minimise UHC and CO pro- ing’, the combustion gases by introducing large
the descent to touchdown on the runway duction the combustion chamber needs to volumes of cooling air just downstream of the
threshold, the landing run, taxi in and shut- avoid producing these compounds by a highly burner flame. It is my understanding that the
down. Visible smoke consists of small soot efficient combustion process, or be able to work done IAE/Pratt and Whitney at this stage
particles in the jet exhaust and is created by burn off the by-products of inefficient, low-rpm, made a significant contribution to the develop-
inefficiencies in the combustion process. combustion. In order to minimise NOx produc- ment of their TALON (Technology for Advanced
Similarly, UHCs and CO are produced by ineffi- tion the combustion chamber needs to reduce Low NOx) combustion chambers which later
cient combustion, particularly at low engine as much as possible the amount of air sub- equipped the IAE V2500 and PW4000 series
rpm. The most important pollutant in terms of jected to the elevated temperatures of high-rpm engines.
amounts produced and potential environmental operation. This is achieved by either limiting The CFM solution was to draw on a radically
impact is NOx. This is produced by an engine the volume of air subjected to high tempera- new combustion chamber design already in the
when air (consisting of oxygen and nitrogen) is tures or by reducing combustion temperatures. prototype stage at GE (GE have design respon-
subjected to high temperatures, particularly The problem facing CFM and IAE back in the sibility for the CFM56 engine core). Called the
during the combustion process, and decom- early 1990s was how to resolve these two con- double annular combustor, or DAC, it effectively
poses. It plays many different roles in terms of flicting design requirements to meet the split the combustion chamber in two, each sub-
its environmental impact: it is a recognised Austrian/Swissair challenge. chamber having its own fuel nozzle. The outer
human health risk, promoting asthma and a Obviously, I was not privy to IAE’s proposal chamber was relatively long and operated at
wide range of respiratory diseases and, in the but we at CFM were led to believe that their the lower thrust levels. This long chamber pro-
presence of sunlight, NOx creates ozone at low solution revolved around modifications to an vided the time in the combustion process to
altitudes thus contributing to the greenhouse existing combustion chamber design. burn off UHCs and, together with a leaner
effect. NOx is also very persistent, remaining in Conventional chambers function on the basis fuel/air ratio, reduced CO. At high thrust levels
the atmosphere for many years after other pol- of what is called the Rich Quench Lean (RQL) both chambers were lit, providing the required
lutants have either dispersed or decomposed. process. The fuel mixture at the nozzle is rela- levels of thrust but with a relatively shorter


The author at the delivery of the first SAS 737-600 equipped with CFM56-7B20 DAC engines, September 1998. The green flower logo was used by SAS
to promote its environmental strategy.
chamber compared to the equivalent conven- ficult for them to agree on a replacement air- separated the two parts of the chamber. To
tional chamber, thus reducing the time at which frame. As mentioned earlier, Sweden had their credit the airlines who selected the DAC
air was exposed to the high combustion cham- already introduced emissions taxes at its air- accepted this additional maintenance cost bur-
ber temperatures (residence time) and so ports and so SAS took a great deal of interest den, as well as a healthy supplement to the
reducing NOx. The design was complex and in the Austrian/Swissair engine selection engine list price, believing it to be a fair price to
could only be controlled by the use of an elec- process. It was therefore inevitable that, once pay to demonstrate their environmental cre-
tronic fuel control system, or FADEC, in order to SAS had decided to replace its DC-9 fleet with dentials. In retrospect, it would probably be fair
correctly manage the staging of the two sets of the 737-600 aircraft, they too should specify to say that the -5B engine entered service with
fuel nozzles throughout the flight regime. the DAC for their CFM56-7B engines. relatively few problems: some hot starts, some
However, with its promise of over 30 per cent Finnair was another airline which later over-temping during taxiing, but no major diffi-
NOx reduction compared to its equivalent sin- selected the DAC engine. While not subjected culties as far as I recall. As the -7B used the
gle annular combustion design, and the fact to specific airport emissions taxes themselves, same core (HP compressor, combustion cham-
that this programme had more credibility due to Sweden was an important market and they did ber, HP turbine) as the -5B CFM believed that
its advanced prototype testing, this was the not want to be at a competitive disadvantage they could confidently offer a -7B DAC to SAS
solution selected by Austrian and Swissair. In with SAS. Having selected the Airbus A320- which would build on the Austrian/Swissair
March 1995 the first CFM56-5B DAC-powered family to replace their DC-9s the decision was, experience and provide a ‘low risk’ entry into
A321 entered service with Swissair, the first of to some extent easier for Finnair as the service. This was not the case.
a total of 375 DAC engines to go into airline CFM56-5B DAC engine had already been in Problems began even during initial engine
service. service with its launch customers for a couple testing. Austrian and Swissair were using their
While Austrian and Swissair were the first of years. The first Finnair A321 with CFM56-5B -5B engines on A320 and A321 aircraft at
airlines to specify low-emission engines for DAC engines entered commercial service on thrusts ranging from 25,000lb up to 31,000lb.
their aircraft they were not the only ones inter- February 5, 1999. SAS had selected the 737-600 aircraft for their
ested in the subject. During the 1990s there domestic and intra-Scandinavian routes and,
were a number of attempts to create close Teething problems as such, the aircraft were expected to operate
alliances between Austrian, Swissair, SAS and With such a complex combustion chamber with very light fuel loads, little baggage and in
Lufthansa. While these early negotiations did design, and the requirement to optimise the a relatively cool operating environment. They
not reach a definitive conclusion they were to staging of the two sets of fuel nozzles, it was only required the -7B engine at its minimum
lead to what is now known as the Star Alliance. inevitable that there would be some teething certified thrust of 18,000lb and, even then,
Much of the discussion focused on fleet com- problems. From the start of the DAC pro- expected to operate with a significant derate.
monality but, despite the fact that these air- gramme CFM recognised that this new cham- Despite the fact that the -7B core was the
lines operated large numbers of Douglas DC-9 ber would generate additional maintenance same as for the-5B, this lower thrust proved
and MD-80 series aircraft, it was extremely dif- costs due to erosion of the centre body which troublesome for DAC development. No matter


The CFM56-5B entered service with relatively few problems.
how they tried the GE engineers just could not were replaced, unserviceable engines stripped
get the -7B DAC to work correctly at 18,000lb down, turbine blades and disks rushed into the
thrust. Get the NOx right and the CO would go laboratories for analysis. The problem was obvi-
off the scale. Get the NOx and the CO right then ously related to LPT blade fatigue but what was
the smoke would be uncontrollable. In the end the cause, and why had the other DAC opera-
CFM were forced to accept that the -7B18 DAC tors not experienced the same problem? The
The combustion chamber
engine was not certifiable and agreed to pro- answer came from a careful analysis of SAS designer is faced with a
vide SAS with a -7B20 engine, 20,000lb thrust flight data and an understanding of the way multitude of conflicting
being the minimum thrust level at which they they operated their 737 aircraft. DAC FADEC
could get the DAC to work effectively. The software was programmed to schedule a fairly priorities. He must make sure
engine was duly certified, the aircraft delivered clear ‘switch’ from single, outer burner opera- that maximum thrust is
and the first scheduled flight of an SAS 737- tion at low rpm to double burner operation at
produced at takeoff, that
600 equipped with CFM56-7B DAC technology high rpm. What in fact was happening was that,
took place on October 31, 1988 - ironically in operating their aircraft into congested maximum fuel economy is
enough, on an early morning rotation between European airports, SAS were forced to fly long achieved at cruise, that the
Stockholm and Paris Charles de Gaulle. landing approaches at intermediate altitudes,
stepping down into the landing pattern. This
flame does not go out at high
The -7B DAC quickly settled into service and
seemed to bear out CFM’s claims of a reliable, forced the FADEC to keep switching the DAC altitude or in heavy rain ... and,
derivative engine. However, during the long, from single burner operation to double burner of course, that the engine
dark winter of 2000, worrying stories began to operation during the landing approach, thus
emerge from the SAS flight line. An engine was inducing a resonance in the LPT disk which
meets its environmental
showing signs of high vibration and borescope weakened the LPT blade root. After more than certification requirements.
inspection revealed that it had lost a low-pres- 1,000 cycles or so blades started to break.
sure turbine (LPT) blade, sheared off cleanly at Alternative operating procedures were
the blade root. A few days later another engine rushed in to avoid ‘long, low’ approaches, LPT
exhibited the same symptoms and, within a disks were re-designed and, over a period of
matter of weeks, SAS had lost five engines. almost two years, engines were modified. This
This was clearly a serious problem and the full was a major challenge to both CFM and the air-
weight of CFM customer support swung behind line but again, their willingness to resolve the
the effort to help this major customer. Engines problem and keep the DAC engine flying was a


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