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Jan 122012

Harmonizing Lease Transfers

Excerpted from "Turnaround Time, Aviation Week's aftermarket blog"

The Aviation Working Group, which comprises lessors, financial institutions and manufacturers, uncovered that the majority (58%) of the $7 billion is spent meeting similar safety objectives and 20% involves maintenance duplication (for example recertifying off-wing engines and revalidating modifications due to the national systems’ requirements that are not harmonized). Only 15% of the costs stem from non-safety differences, such as airspace requirements; 7% are associated with different safety objectives.

Besides the $5 billion in redundant maintenance costs, the work takes 11.47 more days of aircraft downtime, which adds $2.284 billion over 20 years. Given the increased aircraft utilization and efficiencies airlines seek, can anybody afford this extra time and money?

The Aviation Working Group’s longer-term mission is to promote regulatory cooperation to eliminate the majority of extra maintenance costs associated with transferring leased aircraft across borders. It is working with entities including the International Civil Aviation Organization, International Air Transport Association, European Aviation Safety Agency, FAA and member states to reduce duplications. Achieving regulatory harmonization will take time.

However, a short-term task could be fairly easy: encourage airlines to use more digital recordkeeping and eliminate reams and reams of paperwork. “Many lessors already are talking about how to do that,” and one of the lowest hanging fruits is scanning historical maintenance records, says Poutier.

Southwest Airlines has been following that path since 1999. During audits or before a lease return, the airline scans an aircraft’s maintenance records, secures the records storage and makes it accessible online. At the point of lease return, Southwest turns over three DVDs containing the records.

Read the full blog here.

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