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Why Engine-Exchange Programs Can Make Sense for Airlines

Airline options for short-term engine and module exchanges.

Many airlines--probably the majority of them--participate in the whole-engine and module exchange programs offered by some major engine OEMs.

In fact, recent attempts by this reporter to contact 11 large carriers--among them legacy network airlines, low-cost carriers and one large regional airline--in North America, Latin America, Europe and Africa to ask them their views on engine- and module-exchange programs resulted in eight saying they didn’t get involved in such programs. The jury remains out on the other three, which were not immediately responsive to e-mail and telephone inquiries.

However, there are plenty of airlines that do find that engine- and module-exchange programs make sense operationally and economically.

So several major engine OEMs offer airline customers such programs, understanding that at certain times airlines--particularly smaller carriers that don’t have substantial resources in terms of maintenance facilities or spare-engine inventory--find that it makes compelling sense for them to transact a two-way engine or module exchange.

One manufacturer that offers engine and module exchanges is GE Aviation. It does so as part of its TrueChoice Transitions program, a portfolio of services run by subsidiary GE Aviation Materials for customer airlines and lessors.

In addition to offering engine and module exchanges, the TrueChoice Transitions program offers a range of services that include green-time leases, material buy-back and custom workscopes.

Rudy Bryce, general manager of GE Aviation Materials and head of the TrueChoice Transitions program, says the airlines that are typically interested in engine and module exchanges are carriers which either require spare-engine support or have a short-term need for spare engines.

At the same time, such carriers want to ensure they make the best overall choice for their investment horizons and their operational requirements.

For such airlines, it can make compelling sense to receive an engine immediately to end an aircraft-on-ground (AOG) emergency, while at the same time being able to trade what might be a damaged and no longer fully serviceable engine back to GE Aviation in a separate transaction in which the airline receives a fair market value price for the engine’s remaining useable materials.

Similar considerations can apply to engine modules, typically the non-core fan and low-pressure turbine modules that can be removed from an engine at an on-wing maintenance support facility without the need for the entire engine to be taken into overhaul.

If an airline wishes to keep its exchange transaction costs as low as possible, GE Aviation is willing to take serviceable components from the engine that is coming off the carrier’s aircraft and use those in the replacement engine.

Engine and module exchanges often mean an airline can avoid the double engine change that is involved whenever the airline contracts a short-term lease of an engine it is sending out for overhaul.

In some cases, however, if the airline needs a replacement engine immediately to mitigate an AOG emergency but wants for its longer-term replacement engine a specific, customized build, GE Aviation will provide the carrier immediately with a low green-time engine on a short-term lease.

This gives GE Aviation the time to build a replacement engine to the carrier’s specific workscope requirement for longer-term operation. This type of transaction does involve two separate engine changes.

Find out more about how airlines and lessors use engine and module-exchange programs, and the programs that several OEMs offer, in the May issue of Inside MRO magazine.

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