Loading...

Aging aircraft. Fleet planning and maintenance

Seminar Paper 2014 19 Pages

Engineering - Aerospace Technology

Excerpt

Table of Contents

1 Introduction

2 Fleet Planning & Development
2.1 The Economic Life of an Aircraft
2.2 Airline Fleets - A Market Overview

3 Maintenance of Aging Aircraft
3.1 The Effect of Age on Total Maintenance Costs
3.2 Aging Affect on Aircraft Structures

4 Conclusion

5 Appendix 1

6 Appendix 2
6.1 List of Abbreviations
6.2 Bibliography
6.3 Figures
6.4 Tables

1 Introduction

“Public expectation is that aging airplanes are receiving increased attention to maintain safety, including airworthiness of repairs, alterations, and modifications” (Federal Aviation Administration (FAA) 2003, p. 3)

Indeed, the majority of airlines are faced with the challenge of aging fleets and when it 3 might be optimal to replace older aircraft. Well, any discussion of the wisdom of retaining capital equipment is usually based on economic arguments. In a competitive environment, airlines are continuously obliged to improve their business and equipment to stay profitable. The prediction of future maintenance costs of the own fleet is an integral element of pro- spective budgeting projections; on the other hand they serve as a vital part within aircraft replacement calculations. For example if the costs of maintaining the existing equipment on a timely basis exceeds the capital, interest, and amortization charges on replacement equip- ment, the decision to buy a sort of replacement is straightforward. In most cases the substi- tute equipment even offers an improved productivity as well (Dixon 2006, p. 1).

Beside any debate concerning costs and efficiency, flight safety considerations also enter into the discussion especially in the field of aviation. The question to repair or replace is an ongoing decision making process for the maintenance department of every airline operator.

Now the key questions to be answered in this context are: Is it possible to describe a standard airplane service life and how does the fleet age of world’s leading airlines look like? How does the process of maintenance develop over an aircraft’s whole life cycle and can necessary costs be estimated? What can be done technically to keep aging effects of aircraft under control and when might be the right time to withdraw an aircraft from service?

In order to answer the abundance of questions my term paper is divided into an economic based part including compiled data and statistics and a more technical part. In the beginning, this paper investigates the ordinary economic life of commercial airplanes. Additionally I’m going to inspect exemplary the average fleet age of world’s leading airlines. In the second stage I am going to describe how to estimate maintenance costs of aircraft that grow older. Further I wanted to clarify technical aspects and problems that might occur more frequently with the rising age of an aircraft.

2 Fleet Planning & Development

The planning process of an aircraft fleet for an airline is basically not different from any other planning activity in an economic environment. To establish a successful and inherent fleet plan, it requires a well mixture of commercial knowledge, engineering know-how, the ability to predict the future, and as always some luck (Clark 2007, p. 1 f.). Within the process of fleet planning certain knowledge of the term ‘airplane economic life’ is of high interest for air- lines, manufactures and various other interest groups in order to predict future demand of new aircraft. In this Chapter I will go into more detail by investigating the ordinary economic life of commercial airplanes. In a second step I’m going to examine the average fleet age of world’s leading airlines and will draw conclusions from it.

2.1 The Economic Life of an Aircraft

In industry literature a variety of terms can be found describing the life expectancy of an aircraft. It doesn’t matter whether one favours the term ‘airplane useful life’, ‘airplane ser- vice life’, or even uses a host of variations on these terms. All explanations, however, are struggling to precisely define these terms in a way that can be quantified. There is simply no industry standard to quantify the economic life of modern commercial aircraft. Neverthe- less, a commonly used metric to describe the life expectancy of an aircraft is the average age of an airplane when it is permanently withdrawn from service (Jiang 2013, p. 2 f.).

By the end of 2012, the aviation industry appeared to be headed towards a significant drop in the annual average age for commercial passenger jet aircraft retirements as depicted on the next page in Figure 1. A well tended database source shows an average retirement age of 23.2 years in 2012, which is equivalent to the lowest level in more than two decades. This trend might have potentially big implications for aircraft residual values, financing options, parts pricing, lease rates and more (Compart 2013). It is important to now that the economic lifespan of aircraft is always crucial to investors who will need to depreciate their assets and the subject is perhaps more relevant now than ever. One reason for the recent decline in aircraft retirement age might be the market entry of the so called ‘Next Generation Aircraft’ programmes like 737NG and A320E, enforced age restrictions, and order books burst with a record number of orders (Baldwin 2013). Other sources like manufacturer Boeing are blam- ing the great recession, a weak cargo market, and parting-out some young airplanes for the decline in average age of retired airplanes. Furthermore Boeing argues that the introduction of current-generation airplanes is in line with historical trends of their predecessors and that no impacts on the economic life of the worldwide fleets can be expected (Jiang 2013, p. 3).

A trend to shorter economic lives for passenger aircraft would increase the availability of good quality candidate aircraft for conversion. So called ‘P2F programmes’ are otherwise common methods of prolonging the life cycle of an aircraft. Converting veteran passenger airplanes into freighters economically results in savings for cargo airline customers in com- parison to new build cargos aircraft. According to the latest developments by the end of 5 2013, P2F conversions are set to continue as the primary source of capacity for the air cargo market (Harris 2013). A fairly interesting illustration of how a fleet develops as airplanes are added and removed is attaching to this paper in Appendix 1.

However, the recent trend of dropping retirement age will not last. The Irish aircraft lessor Avolon notes that the Airbus A320 family and 737 Classic fleets are relatively young, so airlines retiring the oldest and least efficient of those aircraft are driving down the average. By the time the airlines finally retire the younger ones, Avolon says, most will exceed 25 years of age. Additionally the company supports the thesis that the in-service lives of core single and twin aisle fleets are not experiencing rapid material deterioration. They take the view, that the industry’s economic life assumptions and depreciation policies will remain valid over the next decade and beyond (Avolon 2012, p. 1).

illustration not visible in this excerpt

FIGURE 1: AVERAGE RETIREMENT AGE OF PASSENGER AND FREIGHTER AIRCRAFT (JIANG 2013, P. 6)

The Graph above depicts the trends of the average age of commercial passenger and freighter airplanes that have been permanently removed from service. The solid lines repre- sent the average age at which airplanes leave service. The dashed lines are symbolizing the typical age at which airplanes are scrapped. The difference between solid lines and dashed lines reflects the time that airplanes are in storage prior to being scrapped. Today there are approximately 4.000 aircraft parked or stored in short- or long-term programmes (Baldwin 2012). What can also be seen in the graphic is that average age at end of service has re- mained stable for more than 15 years, gradually increasing as technology advances have been implemented. Over time, significant events, regulation and technology shifts have had impactful influence on the data, although often over only limited periods. These help to ex- 6 plain some of the variation and data.

2.2 Airline Fleets - A Market Overview

Based on the finding of the preceding Chapter, I want to take a deeper look on the worldwide fleet development and average fleet size / age of world’s leading airlines.

According to an internal research of Boeing a total amount of 31.032 commercial jets were built and delivered by western manufacturers since the start of the jet age in 1952 (Jiang 2013, p. 3). As if this wasn’t enough, Boeing is able to predict that the commercial fleet size in service will grow with an average of 3.6 percent per year to double its size from 20,310 airplanes today to 41.240 within the next 20 years. That means that the airline industry will need 35.280 new airplanes, of which 41 percent will replace older, less efficient airplanes. Furthermore an estimated amount of 6.000 to 8.000 mostly wide-body aircraft are expected to be retired worldwide in the next 10 to 20 years (Boeing 2013a, p. 15; Tegtmeier 2007).

illustration not visible in this excerpt

FIGURE 2: FLEET DEVELOPMENTS UNTIL 2032 (BOEING 2013A, P. 15)

Without a doubt, these numbers are very impressive. But where actually is this huge de- mand of new aircraft coming from? In my opinion the development is based on two reasons. On one hand an increase of the annual global air passenger traffic demand of about 5 percent is expected until 2032. That equals a total amount which is more than 2.6 times larger than in 2012 and carriers are forced to increase their fleet size to serve the emerging market (Boeing 2013a, p. 32). On the other hand the average fleet age of world’s leading carriers (in regard of seat numbers of- fered) is fairly high in comparison to smaller aspiring airlines. In other words, to defend their 7 market position and to reduce operating costs, the global airline players will significantly renew their fleets by introducing latest aircraft technologies within the next decades (Clark 2007, p. 11).

To support my theory I conducted a brief market survey based on latest data. In my own interest I considered and compared a selected choice of the largest carriers on the global aviation market in regard of fleet size and their respective aircraft age. The results are presented in the illustration below.

illustration not visible in this excerpt

FIGURE 3: AVERAGE AIRCRAFT AGE IN COMPARISON TO ACTIVE FLEET (OWN ILLUSTRATION 2014; AIRFLEETS AVIATION 2014)

[...]

Details

Pages
19
Year
2014
ISBN (eBook)
9783656651970
ISBN (Book)
9783656651895
File size
1 MB
Language
English
Catalog Number
v272855
Institution / College
University of Applied Sciences Wildau – Wildau Institute of Technology
Grade
1,3
Tags
Fatique Age Aircraft Fleet Maintenance Fleet Planning Economic Life Airline Overhaul Repair

Author

Share

Previous

Title: Aging aircraft. Fleet planning and maintenance