Boeing 777: A drought in aftermarket spare parts?

Narrowing supply stocks and the near-absence of aircraft for disassembly have sparked a worldwide shortage in aftermarket parts for the Boeing 777. In a confounding turn of events, B777 operators are resorting to part exchange options and expensive AOG orders as a result of untimely shortages in the stockpiles for major part suppliers. With the list of clients for Boeing’s long-range twinjet spanning six continents, responses to the current scarcity take on a decidedly global focus.

‘Although reasons for the current dearth in aftermarket spares for the 777 remain unclear, we have received multiple enquiries about locating standard parts for the aircraft. Indeed, it has come to our attention that more than a handful of clients have struggled to find the desired spares for the B777 on both our trading platform and those of competing parts locator services. The pressing factor here is that since such companies provide what is effectively an amalgamated trading platform, it serves to highlight the shortages within key suppliers across the industry. It would be a bizarre case if 777 parts could be sourced solely from Boeing’s own AOG desk – but this is very much the reality at this time,’ comments Zilvinas Sadauskas, CEO of Locatory.com

Ensuing from its official launch in 1995, the B777 has proven to be a resounding success amassing orders from airlines seeking the fuel-efficiency it afforded over existing wide-body jets. Current aircraft numbers in active service stand at 1,073 – a figure more than three times that of its direct competitor, the Airbus A340. Additionally, Boeing continues to attract orders for its 777-300ER (Extended Range), with 32 jets requested by airlines including Cathay Pacific, Emirates and Aeroflot, among others.

‘In the aftermarket sphere, parts for teardown have been relatively less forthcoming. Although perhaps a testament to the 777’s extraordinary safety legacy, only two examples have been written off throughout the jet’s service history. Both of these hull losses – the EgpytAir cockpit fire and the widely documented crash of a British Airways 777 at Heathrow – rendered salvageable components. However the demand for salvaged parts exhausted supplies within mere months following the release of both airframes,’ comments the CEO of Locatory.com, Zilvinas Sadauskas.

Peculiarly, the scrapping of three 777 models in recent times has done more than to raise some eyebrows. Although the examples were fully airworthy, it is clear they were deemed more valuable when reduced to their individual parts – something that would be unheard of ten years ago. Indeed, such an occurrence brings a new dimension to the airline industry with 14-17 year old airframes being worth more in scrap value.

‘Although I may open up a can of worms, such early scrapped aircraft could be a telltale sign of obsolescence. Two of the scrapped 777s were -200 series jets, with the most recent example, a -200ER, being assigned for scrapping just last December. The pivotal issue here is the stronger role that economics plays in determining aircraft values. Quite simply, the 777-200/ER is beaten by the A330-300 for economics on shorter-range journeys and by its larger counterpart – the 777-300/ER on longer range sectors, leaving the jet somewhat obsolete. This is reflected in pre-owned market values, with -300ERs fetching values 50 percent higher than that of similar vintage 777-200ER jets,’ comments Z. Sadauskas, CEO of Locatory.com.

Adding further, he says, ‘Although the 777-200/ER is a very capable aircraft, we may see further examples being scrapped over the next 5-10 years. The cut-throat world that is the airline industry holds efficiency and pragmatism at its forefront, so the limited range of non-ER 777s could mean they prove a less attractive option in their target markets. But it’s not just the 777 affected however, with 11 examples of the highly successful 737-700 meeting their untimely demise – some as young as eight years. It goes without saying that this would be unheard of a decade ago.’

‘From one side, increasing global fleet renewals and a greater acceptance of the scrap value of certain jets does sustain the aftermarket with healthy levels of value-driven parts. Locating and acquiring such parts however remains the next hurdle. Delayed AOG situations continue to be a major headache source for airlines around the world and are only compounded by part supply shortfalls, as we are witnessing now with the 777. Thankfully, several of the major e-platforms for the aviation aftermarket take on the initiative to source relevant suppliers in times of a deficit in specific parts.’