Jetrader - March/April 2013 - 32

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Crucial to the decision to either attempt
to remarket an aircraft or consign it to be
dismantled is the demand for the parts that can
be recovered from the aircraft.
“It is hard to tell an owner that they
will not recuperate their outlay, but that’s
just how it is sometimes,” he added.
However, there is now greater awareness
of opportunities to maximize the value of
assets through the recovery of high-value
components such as avionics, radars or
landing gear.
Crucial to the decision to either attempt
to remarket an aircraft or consign it to be
dismantled is the demand for the parts
that can be recovered from the aircraft.
According to Derk-Jan van Heerden, general
manager of Aircraft End-of-Life Solutions
(AELS), “Of course there are much more
aircraft available for dismantling, but if
less and less of these types of aircraft are
ﬂying, then are you going to ﬁnd buyers
for parts you recover and re-certify. For
example, if you look at the 737 Jurassic
and some of the 737 Classics, plenty of
these are available for parting out, but it’s

now more difﬁcult to ﬁnd buyers for their
parts, which it may have proved costly
to recover.”
“It is true that the market for teardowns
is growing, but it is not necessarily the
number of aircraft available that is making
the difference in the sector,” Zemanovic
conﬁrmed. “It is the type and quality of
the aircraft parts, which are increasingly
seen as a key to thriving in this sector.”
Karl Rickard, CEO of Powerjet Aviation,
believes that the cost and effort put into
recovering parts from an aircraft which
has reached the end of its working life
can be critical in determining the ﬁnancial viability of a dismantling project. “A
few years ago, I would have expected to
recover more than 1,250 parts from older
aircraft of 20 years plus in age. Now, I
will be looking for well under a thousand,
concentrating on those high-value, fastmoving parts that are relatively easy to

32623331_Aero.indd publication of the International Society of Transport Aircraft Trading
The ofﬁcial 1

remove. As more aircraft become available
for teardown, there has been a congestion of parts that can be sitting in your
warehouse for years.”
The availability of new funding mechanisms specially targeted to the aircraft
end-of-life sector is also inﬂuencing the
consideration of whether an asset should be
remarketed or dismantled. Dedicated funding
tools such as Aeronauticsfund are described
as a “breath of fresh air” by Rickard.
Aeronauticsfund purchases aircraft that may
not have traditionally been considered for
dismantling—aircraft in the 10 to 15 years
age range. These aircraft are then consigned
to spare parts sales companies to maximize
sale of high-value parts within a 12-month
period. This model is proving highly successful in enabling the dismantling sector
to compete with lessors or those seeking to
convert commercial aircraft into freighters.
If the long-awaited global economic
recovery emerges and is reﬂected in the
aviation sector, then the choice of remarketing or dismantling will certainly become
clearer. Until then players will have to
manage the inherent complexities within
their sector.

20/01/13 5:32 AM
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Jetrader - March/April 2013

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