Aircraft Retirement Accelerates Due to Parts Shortages, Boosting Asset Trading
What happened
Industry executives report that aircraft are being dismantled much sooner than anticipated, driven by a shortage of parts, particularly aircraft engines, which has increased costs for airlines. An Airbus A320neo, which was delivered in July 2022, was stripped for parts at a facility near Phoenix, Arizona. Aviation asset management and trading firm EirTrade Aviation purchased the aircraft and plans to sell over 1,000 parts from it.
Why it matters
The accelerated retirement and dismantling of aircraft due to parts shortages affects the aerospace supply chain and asset trading markets. This trend increases the volume of scrap aircraft and parts available for sale, while also driving up secondary market demand for components.
Who's involved
- AerSaleOperates a facility in Goodyear, Arizona, where dismantled aircraft are located.
- BoeingGlobal aerospace and defense corporation whose aircraft are subject to accelerated retirement.
- Curtiss-WrightAircraft manufacturer that competes with AerSale in the aerospace and industrial sectors.
- IBA GroupIT company that tracks industry trends and market volatility.
Who could feel it
Possible knock-on effectsThese are possibilities Brind reasoned out, not predictions, and not advice. Most are not stated in any report.
- AerSaleSpeculative
Increased volume of scrapped aircraft and parts available for sale could boost asset trading revenue.
- Curtiss-WrightSpeculative
Increased scrap supply might drive up secondary market demand for parts, benefiting competitors.
- BoeingSpeculative
Accelerated aircraft retirement could lead to market price or demand reduction.
- IBA GroupSpeculative
Increased market volatility might lead to higher advisory revenue.
Keep exploring
The entities involved
-
Boeing
American global aerospace and defense corporation
- Southwest Airlines is detailing its international market expansion, noting it is a US domestic carrier utilizing Boeing 737 aircraft.
- Tensions linked to Iran are causing oil price surges while major hyperscalers like Amazon and Microsoft navigate earnings season amidst operational issues at Boeing and infrastructure challenges involving Corning.
-
AerSale
aviation Company
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