Why new-generation engines are a concern and blessing for ALC

Air Lease Corporation (ALC) has been most vocal and critical of engine makers for failing to produce engines that are reliable. At last week’s JP Morgan Industrials Conference in New York, ALC’s top management repeated that it is hugely disappointed about the on-wing performance of new-generation engines. Why new-generation engines are a concern and blessing for ALC.

Elaborating on this, Chairman Steven Udvar-Hazy said: “All of these new-technology engine programs

that power the Boeing 787, the Airbus A330neo, the MAX, and A320neo family were developed twelve to fifteen years ago. The key ingredient and motivation for the engine manufacturers in developing these engines was fuel consumption to reduce fuel burn by around fifteen percent. And secondly, these engines have lower emissions and generate less noise. But to achieve that, all the manufacturers pushed technology to the outer end of the envelope in terms of alloys, the heat in the engines, and efficiencies that they tried to gain to achieve these objectives.”

“Consequently, what we have today, is engines that are delivering a fifteen percent average reduction in fuel burn per seat, but the maintenance costs are far higher than were originally projected,” Udvar-Hazy added, “because these engines are not staying on the wing as long as their predecessors. They have to go to the stop and get upgrades, whether it is blades or things to the combustor.”