A look back at MRO Europe

Monetisation is driving retirements, how to live with the new normal and plans to collaborate on traceability.

What’s happening in the industry? What should we be looking out for as the year turns? The ecube team were out in force at MRO Europe in October. Our CEO, Lee McConnellogue also joined partners and customers on a panel to discuss trends in disassembly and USM.

Here's our overview of four key trends that emerged from the event:

• Lack of retirements.
• Economic vs environment benefits.
• Adapting to market conditions.
• Collaborating on traceability.

Lack of retirements.

The strong traffic return is keeping aircraft flying, with knock on effects. The panel mentioned how some aircraft are not reusable. The rise in passenger demand and delays to new aircraft and parts is pushing aircraft to their last cycle. As one panellist said, some aircraft are ‘totally run out’.

Prices for aircraft are therefore going up. That said, ecube is on target to dismantle and reuse more aircraft this year than in 2023. Lee McConnellogue mentioned on the panel that “some companies are willing to pay for aircraft to harvest the parts. So, in some parts of the industry, we’re seeing a higher trading volume than perhaps we’d all anticipated back in Dublin at the start of the year”.

Economic vs environment benefits.

Aircraft are being disassembled at both ends of the spectrum: economic and environmental. There's the economical life of an aircraft, which is variable based on what the market demands on the date. Then there's the ESG angle, of how long you keep the aircraft on the side (ESG - Environmental, Social and Governance).

“At ecube, we’ve disassembled aircraft that are 39 years old and also those with as little as 9 years of service”. Lee McConnellogue explained that “There are two different things going on here. Keeping an aircraft running for nearly 40 years clearly benefits the environment. But it also drives up the value of aircraft and parts; there are fewer of them”.

On the flip side he concluded, disassembling a 9-year-old aircraft is a “stunning economic decision for the company involved. It’s just not so good for the environment”. Others on the panel also said they were acquiring aircraft for disassembly or reuse that were 8-13 years old.

This is not a traditional age for end-of-life aircraft. It’s happening because of the pressure for parts. Lee McConnellogue explained how it’s no longer the age of an aircraft that decides when it exits, or increasing lifecycles or new technology. It’s now about book value and what the market will pay.

As Lee says, “It’s the ability to monetise that decides when the asset leaves”.

Adapting to market conditions.

The general consensus on the panel was that this is the new normal. The industry has to adapt to the conditions, and perhaps develop different strategies. The panel suggested this could include reusing traditionally difficult items. At ecube we’ve reused a stabiliser and engines and have a landing gear replacement lined up before the end of the year.

Adapting is also going to involve making difficult decisions. Like whether to cash out, or invest for the long term. CFM Materials talked about sometimes changing their original underwriting plan to one of overhaul and reuse.

We think the industry needs to discuss this more widely. It’s going to be important to have new strategies to manage the cost of assets and the shortages of reusable or new parts.

Collaborating on traceability.

This is a look to the future that’s becoming urgent. Our CEO believes the industry “lacks ambition in this space”, and yet it’s a prime area where we can bring value and show commitment to safety.

We discussed three areas:

• Vendor accreditation
• Paperwork
• Non-serialised parts

The Aviation Supply Chain Coalition has been looking at how to improve all these areas. We know that accreditation needs work, after the 2023 issue when AG Technics was caught falsifying records. They had the ASA logo on their website, but hadn’t been audited by ASA.

There’s a big push at AFRA too, to manage traceability together. This would strengthen the entire supply chain from a safety perspective. So, we need to reassess the industry’s use of paperwork. Our forms haven’t changed in years and are as easy to forge as a 16-year-old using fake ID to get into a nightclub. Non-serialised parts have always been an issue and yet are crucial to safety.

Other high value asset industries are looking at digital fingerprints. This means that with one image you can identify and trace your part. ecube came across parts fingerprinting at the ASA AFRA 2024 Conference. Alitheon’s new technology uses optical-AI to “see” the minute surface details of physical items. It then converts them into a unique mathematical identity, a fingerprint. There’s more on this in our blog - Tracing a Route to Better Recycling

As Lee said, “Traceability is about criminals, not process. Accreditation and paperwork can be misused or forged. We need to be working on something that will combat this”.

It was fascinating to hear how these trends affect our industry more widely. There’s a lot of work to be done across the industry, but we look forward to seeing how these trends develop in 2025.

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