Jetrader - Summer 2016 - 14

More Used
Parts Take
to the Air,

Recycled Through

W

By A.P. Scott

When it comes to spare parts, airlines have a
second option - the secondhand market -
and it's taking off. More and more aircraft
owners are choosing to dismantle aircraft
at a younger age and sell them in parts,
making more money than if they were sold
whole. More and more operators are buying
used parts; spending less money than if they
bought new. And some airlines are able to
support their entire fleets with their own
secondhand parts, which aircraft dismantlers
say can be a gold mine for them.
"Many airlines have gone bankrupt
over the last 10 years, that shows that
cost issues are vital for airlines, and
the spare parts market is a big cost to
them," says Ayce Celikel, cofounder and
managing director of Aerobay, an innovative, e-commerce platform for buying
and selling recycled and surplus parts for
the aerospace industry. "Airlines have to
do maintenance every day, they have to
do  repairs every day, they have to find
these parts and they can reduce their costs
70 to 80 percent by taking advantage of
the secondhand option."

Previously, an aircraft would go on flying until it was 30 or 35-years-old, Celikel
says, but in the last 10 years, end of life
has shifted to a much younger age. End
of life is now 20-years-old on average,
not because an aircraft cannot fly into
its thirties, but economically, it is too
expensive to operate and maintain an
older aircraft. The aircraft owner must
make the best financial decision - keep
it, sell it as a whole, or manage an operation of aircraft dismantling.
In most cases, after 15-years-old, it is
more financially sound to dismantle an
aircraft than to sell it whole, Celikel says.
As an aircraft owner, a younger dismantled
aircraft will be a greater asset, with 1,000
to 1,500 parts per aircraft typically selling
in the secondhand market, hence the shift
to dismantle younger aircraft.
Richard Hervé, who cofounded Aerobay
with Celikel in Paris and now serves as its
president, says over the next 10 years, it's
projected that more than 10,000 aircraft
will be dismantled. "Before now, most
airlines would turn to OEMs to purchase

14 The official publication of the International Society of Transport Aircraft Trading

new spare parts to support their fleets,
but that was in the past. Now good, used
parts are coming from aircraft dismantling
activities," Hervé says. "This gives airlines another option: re-certified, used
parts that they can buy to support their
fleets  and cut their costs, making their
businesses more profitable."
The latest forecast shows that by 2020,
revenue coming from the sale of used parts
will be roughly $20 billion to $30 billion
($13 billion to $17 billion for the engines,
$7 billion to $9 billion for the components,
$1 billion for the airframe), Hervé says,
solidifying the secondhand aviation market
as a beast of the market.
For 14 years, Hervé worked for Zodiac
Aerospace as the global head of marketing
and business development in the aftermarket branch.
"We were already in competition with
the used parts market, but it was marginal
compared to today," he says. "Five years
ago, roughly 400 to 500 aircraft were being
dismantled with parts resold or recycled,
but the trend is now between 600 to 800



Jetrader - Summer 2016

Table of Contents for the Digital Edition of Jetrader - Summer 2016

A Message from the President
Calendar/News
O&A: Tom Doxey, Allegiant
More Used Parts Take to the Air, Recycled Through the Secondhand Market
Alliances - Made to be Broken
The Balancing Act - Record Profits and Uncertain Futures: Reflections from ISTAT Americas 2016
Growth in ISTAT Asia Continues
Securing the Future: A Profile on ISTAT Foundation Student Andre Fansi
Turkey: Drones Now and in the Future
Avation History
Aircraft Appraisals
ISTAT Foundation
Advertiser.com
Advertiser Index
Jetrader - Summer 2016 - cover1
Jetrader - Summer 2016 - cover2
Jetrader - Summer 2016 - 3
Jetrader - Summer 2016 - 4
Jetrader - Summer 2016 - 5
Jetrader - Summer 2016 - 6
Jetrader - Summer 2016 - A Message from the President
Jetrader - Summer 2016 - 8
Jetrader - Summer 2016 - 9
Jetrader - Summer 2016 - Calendar/News
Jetrader - Summer 2016 - 11
Jetrader - Summer 2016 - O&A: Tom Doxey, Allegiant
Jetrader - Summer 2016 - 13
Jetrader - Summer 2016 - More Used Parts Take to the Air, Recycled Through the Secondhand Market
Jetrader - Summer 2016 - 15
Jetrader - Summer 2016 - 16
Jetrader - Summer 2016 - 17
Jetrader - Summer 2016 - Alliances - Made to be Broken
Jetrader - Summer 2016 - 19
Jetrader - Summer 2016 - The Balancing Act - Record Profits and Uncertain Futures: Reflections from ISTAT Americas 2016
Jetrader - Summer 2016 - 21
Jetrader - Summer 2016 - 22
Jetrader - Summer 2016 - 23
Jetrader - Summer 2016 - 24
Jetrader - Summer 2016 - 25
Jetrader - Summer 2016 - 26
Jetrader - Summer 2016 - Growth in ISTAT Asia Continues
Jetrader - Summer 2016 - 28
Jetrader - Summer 2016 - 29
Jetrader - Summer 2016 - 30
Jetrader - Summer 2016 - 31
Jetrader - Summer 2016 - 32
Jetrader - Summer 2016 - Securing the Future: A Profile on ISTAT Foundation Student Andre Fansi
Jetrader - Summer 2016 - 34
Jetrader - Summer 2016 - 35
Jetrader - Summer 2016 - 36
Jetrader - Summer 2016 - Turkey: Drones Now and in the Future
Jetrader - Summer 2016 - 38
Jetrader - Summer 2016 - 39
Jetrader - Summer 2016 - Avation History
Jetrader - Summer 2016 - 41
Jetrader - Summer 2016 - 42
Jetrader - Summer 2016 - 43
Jetrader - Summer 2016 - 44
Jetrader - Summer 2016 - Aircraft Appraisals
Jetrader - Summer 2016 - 46
Jetrader - Summer 2016 - 47
Jetrader - Summer 2016 - ISTAT Foundation
Jetrader - Summer 2016 - 49
Jetrader - Summer 2016 - 50
Jetrader - Summer 2016 - 51
Jetrader - Summer 2016 - 52
Jetrader - Summer 2016 - Advertiser.com
Jetrader - Summer 2016 - Advertiser Index
Jetrader - Summer 2016 - cover3
Jetrader - Summer 2016 - cover4
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