A 737 being serviced at AAR’s MRO facility in Indianapolis. AAR
A 737 being serviced at AAR’s MRO facility in Indianapolis.

Boeing 737-800 Not Expected To Peak Until 2021

Expect the Boeing 737-800 stalwart to generate $14.6 billion in aftermarket expenditures this year (excluding the additional CFM56-7B inspection costs).

Printed headline: Mass Appeal

The Boeing 737-800 is the most popular narrowbody aircraft in the world, with more than 5,000 expected to be in service by the end of 2018, according to Aviation Week Network’s Commercial Aviation Fleet & MRO Forecast.

Its main rival—and second-most numerous aircraft in service—is the Airbus A320-200. And while the A320 family has outsold the 737NG family, Boeing’s baseline 737-800 remains the top choice for airlines, lessors and financiers.

Powered by CFM56-7B engines, the 737-800 entered service in 1998. Since then, engine, airframe, avionics and cabin upgrades have maintained the aircraft’s popularity with airlines and passengers; in-service numbers are expected to peak in 2021 at around 5,200 aircraft. Furthermore, no 737-800 retirements are expected before 2021.

At that point, Boeing will be focusing production on the -800’s successor, the 737 MAX 8, whose in-service numbers should rise to about 2,400 in 2022 from 363 in 2018, according to Aviation Week Network. In fact, MAX 8 production is expected to overtake 737-800 output this year and then sharply accelerate. Aviation Week predicts 502 deliveries of the newer aircraft in 2019, versus 84 of the -800.

AAR

A 737 being serviced at AAR’s MRO facility in Indianapolis.

Naturally, fleet estimates depend somewhat on oil prices. Should these creep back to the $100-per-barrel mark, 737NG retirements may accelerate, but a return to recent norms of $50 per barrel could mean deferrals of MAX deliveries.

For now, the 737-800 remains popular across most vintages, which should prove a boost for the maintenance and modifications market. “Demand is strong for the 737NG family, and a lot of operators are extending lease periods with aircraft lessors,” says Donatas Dockus, vice president of sales for aircraft lessors at Lithuanian MRO provider FL Technics.

Aftermarket

The 737NG output has stayed at high rates for almost two decades, offering a steady stream of overhaul work for airframe and engine MRO providers. Most of this is for the 737-800, which will provide $14.7 billion of maintenance demand in 2018, rising to nearly $16.6 billion in 2022.

“The 737NG fleet is large and drives a lot of maintenance requirements,” agrees Troy Jonas, vice president of global sales and marketing for MRO provider AAR. It will continue to drive a large share of MRO needs in the foreseeable future.

Aviation Week Network expects the maintenance market for all 737 types to reach $21.7 billion in 2018. Of that total, 41% is projected for component work, 27% for engine maintenance, 22% for line maintenance, 5% for airframe work and 5% for modifications.

FL Technics reports that 737NGs entering its hangars are on average 9.5 years old. At that age, most 737NGs are approaching their first heavy check. The company says its turnaround time for an initial C check is 3-4 days, rising to 11-14 days for older aircraft requiring heavier checks that incorporate some out-of-phase work.

One of the most time-consuming aspects of heavy checks is fuel tank inspections, which require “many hours to remove the sealant inside the fuel tanks so we can access the structure to do both visual and [nondestructive testing] inspections,” Jonas says. “The irony is it takes all that effort, but we very rarely find defects—it’s just part of the inspection requirements.”

Both AAR and FL Technics report vapor barrier cracking near the wing root as a common issue during 737NG checks. “Cracks are often found in the wing root structure, and they require reinforcing repair, involving repairs to the fuel tank structure,” says Kestutis Jasutis, head of production planning for base maintenance at FL Technics.

Access to the affected sites is difficult, however, and further operational checks are required after repairs are performed. Even then, problems can recur: “A few issues that we see occur are with the lower 663 section vapor barrier,” says Jonas. “It’s fairly common to find that it’s cracked, and previous repairs to the same area have not proven to hold up.”

Another common problem is corrosion near wet areas such as bathrooms and galleys, although such issues are not restricted to the 737NG and often occur on any type of aging aircraft. At their most severe, such problems can require floor beam replacements.

Engines

Unlike the A320, which comes with a choice of CFM or IAE powerplants, the 737NG is powered only by the CFM56-7B. Boeing also released the 737 MAX with a single-engine option—the CFM Leap 1B—and some industry watchers say this has hurt its sales against the A320neo, although lack of choice never harmed its predecessor, the 737NG.

Instead, the 737NG has benefited from an engine that has proved extraordinarily reliable and durable, with some lasting one-third longer than their initially envisaged mean time between overhauls. And despite being 16% less fuel-efficient than the new Leap engine, the CFM56-7B still offers economic operations for cost-conscious operators.

The Aviation Week Network predicts CFM56-7B maintenance spending will jump to $4.2 billion in 2018 from $3.3 billion last year, stabilize until 2022 and then steadily rise to $6.5 billion by 2026.

However, those forecasts may prove an underestimate because they were made before the uncontained failure of a CFM56-7B on a Southwest Airlines flight in April. Following the accident, in which one passenger died after engine debris shattered an adjacent window, the FAA and European Aviation Safety Agency ordered operators to perform ultrasonic inspections of any -7B fan blades with more than 30,000 cycles. The airworthiness directive (AD) was then extended to mandate inspection of fan blades before they reach 20,000 cycles, with follow-up checks required every 3,000 cycles.

The April incident, and another engine failure that occurred with a different Southwest 737 in 2016, were both linked to metal fatigue. The FAA said the extended AD covers about 3,700 engines, which will increase unscheduled maintenance spending considerably over previous forecasts. 

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