The settlement between CFM International and IATA on treatment of PMA parts and DER repairs continues to elicit optimism, along with some important questions, among providers of engine PMAs. Their hope is that the agreement sets a path forward for more OEMs and the leasing firms that are crucial in determining actual PMA use.
“This is a significant win for alternate solution providers like Wencor Group,” argues Senior Marketing Manager Raisa Ferdinand. “This agreement removes significant OEM-imposed restrictions on the use of alternate part solutions.”
Ferdinand believes CFM will apply the more PMA-tolerant policies across its engine types, and CFM-partner GE will do so as well. Thus, an airline using a PMA part or DER repair will be able to have engine maintenance performed at a shop licensed by CFM or GE Aviation. She says these PMA and DER alternatives can range from very simple hardware to complex bearings and blades.
Another gain in the settlement is no longer denying warranties or access to manuals if a PMA part is used. Ferdinand notes these restrictive penalties have not been confined to CFM and GE. Thus, “this landmark settlement has significant implications for all aspects of the alternate parts business outside of just CFM and GE.”
Wencor’s alternate part solutions are less common in engine cores and more common in systems and accessories that attach to engines, such as the internal drive generators and starters. The company has been distributing the settlement terms to its current and possible future customers. “Wencor is excited about the agreement and is looking forward to supplying part solutions that compete based on value propositions and significant savings for customers,” Ferdinand says.
Nadim Fattaleh, vice president of business development at Jet Parts Engineering, also believes that CFM and GE will now follow the same, more tolerant policies toward PMA parts and DER repairs. And Jet Parts has already begun to receive request for quotes on parts that are alternatives to CFM parts from customers who have not historically accepted test-and-computation PMAs for CFM engines. “Ultimately, buying behavior depends on customers’ interpretations of the agreement between themselves, IATA and CFM and GE,” Fattaleh acknowledges. “Having said that, we are optimistic that more opportunities will open up for customers to save on the material portion of their maintenance costs.”
Fattaleh is worried, however, by clarifying comments made by Bill Dwyer, GE Aviation Services marketing leader, on September 13. Even though FAA approves the use of engine manuals to determine airworthiness during the certification of PMAs and DERs, Dwyer said GE and CFMI will continue to allow MROs under their influence to use these manuals to determine airworthiness only for OEM, but not for non-OEM parts, encountered during overhauls. “This anti-competitive strategy forces their customers to seek alternative ways to obtain 8130-3s, resulting in additional costs and longer turnaround times,” Fattaleh says.
In any event, Jet Parts believes that CFM’s acceptance of PMAs and DERs will influence the other OEMs as well. GE already plans to follow the same policies as CFM. The whole negotiation began when IATA filed a complaint with EU antitrust regulators in 2016 charging CFM and Honeywell with anti-competitive maintenance contracts. “We would expect Honeywell to follow CMF's lead in the near future,” Fattaleh says.
But Honeywell spokesperson Steve Brecken says, “Honeywell believes that our practices are fair and in compliance with all relevant laws. We have and will continue to cooperate with the European Commission’s preliminary inquiry.”
Due to the relationship between GE and GECAS, Jet Parts also believes that aircraft financiers, such as lessors, debt providers and capital markets, will see the value and benefit of reduced maintenance costs from PMAs and DERs. “More global acceptance of PMAs and DERs will minimize any hit to financiers’ balance sheets that results in a reduced book valuation of assets that utilize alternative parts, including aircraft, engines and components,” Fattaleh says.