Gediminas Žiemelis: Selecting the optimal engine for the A320 NEO: the PW1100G GTF or the CFMI-Leap-X?

The discussions among aviation experts in western media regarding the potential winner in the A320 NEO engine race are rapidly gaining acceleration. There seems to be two major competitors that are currently closest to the finishing line: the Pratt & Whitney produced PW1100G GTF and the markedly improved new generation CFMI (CFMI-Leap-X). With respect to the declared fuel characteristics and operating efficiency, Avia Solutions Group experts point out, that the present aircraft technical maintenance and support market is 5-6 times larger than the newly-delivered engine market. They also maintain that most of the expenses associated with the overall A320 NEO – operational costs will be related to engine technical maintenance, repair and fuel costs. Hence choosing the right engine requires a thorough analysis encompassing all aspects of airline activities.

Generally speaking, both engine manufacturers claim to offer exceptionally high fuel consumption effectiveness. However, with regards to the fact that new engines, as compared to the existing generation ones (CFM56-5B/7B, V2500-A5), are significantly much more efficient; therefore, the difference between prices of running an aircraft with any type of the new generation engine is relatively minor.  This also applies to the MRO-related expenses. Under such circumstances, regardless of the engine type an airline selects for its aircraft, it must focus on achieving the right balance between fuel and maintenance costs. The decision making process should involve a detailed airline activity analysis covering financial options, opportunities to fuel its aircraft in the countries where fuel prices are lower, different ways of paying for technical support and maintenance services (Pay-by-the-Hour, engine maintenance lease reserves, Pay as you go, etc), aircraft fleet phase-in and phase-out plans, etc.

According to the IATA, fuel costs amount to approximately one third of all airlines’ expenses. It is very hard to arrive at more accurate estimates since oil prices constantly fluctuate. Airlines can seek ways to optimize fuel expenses by finding a reliable fuel supplier, optimizing routes and choosing the best destinations for fuelling. However, applying such strategies in practice can prove quite a challenge since the sluggish efforts to de-monopolize fuelling industry in airports.

Moreover, all declared fuel efficiency characteristics are based on estimates and depend on many factors.  When seeking to optimize fuel expenses, airlines should focus on creating a highly efficient and consistent strategy: set explicit management goals, establish reliable partnership with all route network airports, select reliable partners and refuelling companies, regularly monitor and track the technical condition of all engines and APUs as well as optimize MRO processes. A systemized implementation of the following measures will help to decrease fuel expenses by 5-8%:

• Flight plan optimization, proper aircraft distribution based on distance and route load, reducing the number of non-commercial flights (technical and test and ferry flights);

• Constant fuel price data monitoring, fuel invoicing and fuel quality analysis;

• Aircraft centring and commercial load optimization before every take off;

• Regular airframe and engine  cleaning/washing procedures;

• Aircraft fuelling and fuel reserve optimization on all network routes, optimizing airport approach and climb schemes, proper speed selection whilst in cruising mode;

• Optimization of systems directly or indirectly connected to fuel consumption (APU, Flap, slat, thrust reverser, landing gear), depending on particular airport infrastructure and air traffic management systems en route;

• Careful slot selection aimed at minimizing fuel consumption during taxiing, engine and APU launch at the latest possible time, proper use of de-rate take off (depending on specific airport infrastructure and weather conditions), single engine mode during taxiing.

There is also a number of ways to manage fuel expenses. An aircraft operator should conduct a thorough inspection of its A320/B737NG fleet and to analyze the business experience with its MRO-providers as well as spare parts suppliers. One of the ways to reduce the CFMI-Leap-X maintenance cost is the unification of the upcoming fleet with the existing CFM56-5B/7B engines. For example, Southwest is the first buyer of the B737 MAX generation aircraft with a powered Leap-X engine. The current airline fleet consists of B737 CL and B737 NG type of aircraft. The airline has already started replacing the B737 CL aircraft to the NG ones and in the future they are planning on replacing the NG to the MAX type of aircraft and to keep the same airframe as well as engine manufacturer.  Despite substantial modifications, these two engine generations will still share common maintenance principles. Therefore, engineers and technicians won’t have to ‘switch over’ to the innovative Pratt & Whitney product, which has been unavailable for these types of aircraft till now. Choosing the Leap-X will also provide an operator with the opportunity to strengthen and develop further relations with the CFMI manufacturer. However, if a fleet contains regional ATR42/72, Dash Q-series aircraft or the long-range Boeing 767/777/747/757s, equipped with Pratt & Whitney engines, the operator should consider opting for the PW1100G. It will help to optimize maintenance costs for the entire PW engine line operated in the company’s fleet. This especially applies to the wide-body aircraft ‘large’ engines, which require expensive overhauls.

A thorough fleet analysis and proper aircraft distribution within the company’s flight network will also help to reduce costs. However, integrating new types of aircraft into an existing fleet cannot be done rashly. Before making an acquisition, airlines, with the help of independent aircraft, engine and network optimization experts and consultants, should conduct a thorough analysis of new types of engines and aircraft.  Sometimes carriers should consider outsourcing marketing research. Carefully applied, these measures will help operators to avoid negative consequences of a hasty choice based on provided theoretical characteristics of an airplane or an engine.

The cost of engine MRO-costs amounts to approx. 40% of all MRO expenses.

Hence a well-considered engine maintenance approach may also help to lower the overall expenses, primarily, by optimizing fuel consumption.

Modern engines require an overhaul every 8-12 years. That is why an air carrier with a modern fleet has no need for a large team of highly qualified personnel.  Though it is obviously a very cost-effective policy, sooner or later engines will still require maintenance. This is a delicate issue with its advantages and disadvantages that all need to be taken into consideration prior to choosing the most cost-efficient approach.

In the new generation A320 NEO engines the manufacturers have preserved the best technical solutions found during operation of the previous engine generation and have implemented innovative technologies as well as highly sophisticated overhaul solutions. Organizations, developing OEM alternatives, will also find a niche in this market by offering DER repairs and PMA parts solutions. The secondary spare parts market will emerge shortly after airlines start operating the new A320 NEO engines. If some of the life-limited parts keep the same part numbers (which is typical for the CFM56 family), secondary materials will be available on the market almost immediately. Either way, in order to evaluate every offer and possibility, an operator needs to have sufficient experience and production capacities.

Usually airlines cannot accurately estimate the total cost of engine maintenance services such as hospital repairs or engine overhaul. As a result, they end up being unpleasantly surprised by the invoices they receive from MRO companies. Independent market experts have calculated that the annual losses the CIS-based airlines suffer from A320, B737CL, B737NG engines’ MRO services amount to USD60 million. The largest portion of these expenses falls to modern CFM56-5B/7B and V2500-A5 engines’ overhaul as the majority of aircraft operators face the need to repair these engines for the first time since starting their exploitation. An average price for repairing a single narrow-body airplane CFM56 or V2500 engine is USD2.5-3 million. Working along with independent MRO experts may save an airline up to USD300-600 thousand, i.e. almost 20% of the final cost.

Since experts from MRO organizations possess the necessary experience and knowledge they may both manage the overhaul process and participate in it. They are well aware of the reputable and reliable engine repair companies in the market. Such organizations can weigh all the advantages and disadvantages thus arriving at a well–informed decision regarding the best spare parts supplier and component overhaul company that offers the most optimum maintenance solutions. Moreover, managing a large scale of engine overhauls means that independent organizations gain access to way cheaper spare parts pricelist and may offer lower-priced components’ overhaul services. This allows to significantly decrease the overall cost of MRO engine services and to switch suppliers, should their conditions intersect with customer demands.

The way the modern Western engines (including PW1100G and CFMI-Leap-X) are manufactured allows maintenance specialists to conduct partial engine repairs or restore only certain components without fully dismantling the entire engine or performing its full overhaul. Such approach doesn’t counteract with the agreements made between airlines, aircraft lessors and financiers. After inspecting an engine, independent experts offer their client only such MRO services, which are truly required in accordance with the engine exploitation plan and aircraft return conditions.

Therefore, in order to make the right decision regarding the A320 NEO engine selection airlines should take into consideration the following:  company’s past and current cooperation experience with engine manufacturers, aircraft fleet phase-in and phase-out plans and general strategy, route network optimization, fuel suppliers, MRO providers and independent engine maintenance experts. Proper combination of these factors will help airlines to achieve the best possible balance between operational reliability, fuel efficiency and exploitation expenses, regardless which type of a new generation engine they choose.