Major Flag Carrier – Design and Implementation of Revised Engine Overhaul Strategy
Nyras was asked by a major flag carrier to review engine-related expenditure, following a planned extension of all leased aircraft in the client’s fleet, and a significant and unexpected increase in forecast engines expenditure, as compared to previous years. Our key aims were to:
- Review engine expenditure within the five-year plan.
- Identify opportunities for significant cost savings.
Nyras drew together an experienced team consisting of an engineering finance / lease professional and a powerplant expert, who reviewed the detailed supporting data provided by our client.
In order to understand the increase in forecast engine expenditure, we reviewed the figures included within the five-year plan, taking into account engine maintenance cost per hour (MCPH) contracts, engine overhaul strategy and the requirements of leases.
We aligned this information to the powerplant department plans, and worked with the powerplant team to understand the engine overhaul strategy. Our team then applied this knowledge to ‘fly forward’ to the current end of lease, and then a proposed a new end of lease, to ascertain the accurate costs.
Finally, we reviewed the forecast engine shop visit costs and compared them to the requirements of the lease and best practice shop visit costs and engine management.
Nyras identified opportunities for significant cost mitigations by changing engine overhaul policies for both first and second shop visits.
We then worked with our client to align revised engine policies to lease extension proposals and fleet strategy delivering savings of some $109m.