Engine Lease Transition

Management
Presented by Trish Gray, 3rd May 2019

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 Transition Management

3 Areas of Management

• Records

• Physical Condition of the Engine

• Commercial Settlement / Reserves

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 The Keys To A Smooth
On Time Transition Are…

Close Co-ordination between Lessors and Operator

Know and Understand the Contract

Planning

starting at

Delivery

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 Delivery

Engine Records

• Increasingly engine records at a transition are reviewed remotely

• Scanned records are frequently received at a delivery. These
records are often not retained in a coherent filing system by the
airline.
• If records are added to the physical binders e.g. signed status
sheets. The electronic copies are often not updated.
• Time is lost at a redelivery waiting for the physical records to be
rescanned.

If electronic records are filed and stored correctly at delivery, an

airline only needs to add the records for the period of their
operation.

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 Mid Lease

Shop Visits – Commercial & Physical

Airlines
• Does the workscope meet the contract requirements?
• Is the engine built to redelivery conditions?
• Does it qualify for Reserve Drawdown
• Settlement Fee operators- should a module be overhauled or
compensation paid at the EOL?
• What happens if the lease is extended? Will a short build will
lead to an avoidable hand back shop visit for the new End of
Lease.

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 Mid Lease

Shop Visits – Commercial and Physical

Lessors
• Has it been short built?
• Will the engine be marketable at redelivery
• Should a lessor add value at the shop visit?

Engine Redelivery Conditions Are the Biggest

Contributor to Increased Engine $/Hr Rates

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 Mid Lease

Shop Visit Records

• Review in detail once received
• Ensure the DFP’s are provided
• Check the LLP back to birth
• Ensure all AD’s and critical SB’s have been embodied
• Have all the requirements for redelivery been addressed?

These items are usually a condition for any reserve

drawdown request

Delays at Redelivery due to Shop Visit Records are

Avoidable

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 Redelivery

Lessors and Airlines Should Work Together a Minimum of

6 months Prior to Redelivery
Physical Condition
Review the engine condition against the redelivery terms
• Trends
• LLPs
• Borescope

Allow time for a shop visit

Be aware of lead time for inductions/ shop TAT

The majority of last minute shop visits can be avoided if airlines

and lessors review the engine condition early

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 Redelivery

Commercial

• If engine does not meet redelivery conditions

– can compensation be agreed?

• Settlement Fee Calculations

• Would it be cheaper to put the engine into

the shop than pay the fees?

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 Redelivery

Records
With early planning:
• Records can be updated, reviewed and scanned
• Missing records e.g. shop visit DFP’s, back to birth records can
be chased.
• On-wing AD’s & SB’s workcards can be located

Engine records are complex when there has been more than 1
installation. Airline records are usually controlled by the aircraft.

Care must be taken that the provided records are for the right
engine installation.

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 Summary

Smooth Transition Management Relies on…

• Good communication between Lessors and

Operators

• Understanding the Contract

• Planning for the Redelivery Before Delivery of

the Engine

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