Why Airbus A320neos Are Being Torn Down Early

That's the evolution, I guess, of the USM market for this aircraft.

As we know, USM often associated with more mature aircraft programs.

But are we now reaching the point where the A320neo has a sufficiently large installed base in the global fleet? And of course, the maintenance requirements to support a genuine A320neo USM market at this stage?

I would say the USM market is always in demand, even when those first aircrafts roll off the assembly line.

What makes it a viable market for us is when the economics come down that you can acquire the assets.

So the acquisition of the assets is going to be key in addressing that key market demand.

Obviously, always the selling point of USM is the price differential and the TAT differential from an OEM supplier for those aftermarket.

We're always going to be a little bit cheaper, going to be a better on the shelf availability or better lead times.

But that doesn't make sense when you're paying book price for an aircraft.

You can't really do that on a teardown side.

So you have to have some kind of shock to the system in order to make that supply available to us that we can go capture it and turn it around for us to make a profit and the operators to have a value decision to make as well.

So I think we're at an inflection point because of the supply situation.

There's also the demand, you know, weakened a little bit with the Middle East conflict as well as the other issues going on.

So I think it is a good point where you're going to see aircraft become available at the right price and at the right time.

Interesting, actually.

That's the evolution, I guess, of the USM market for this aircraft.

As we know, USM often associated with more mature aircraft programs.

But are we now reaching the point where the A320neo has a sufficiently large installed base in the global fleet? And of course, the maintenance requirements to support a genuine A320neo USM market at this stage?

I would say the USM market is always in demand, even when those first aircrafts roll off the assembly line.

What makes it a viable market for us is when the economics come down that you can acquire the assets.

So the acquisition of the assets is going to be key in addressing that key market demand.

Obviously, always the selling point of USM is the price differential and the TAT differential from an OEM supplier for those aftermarket.

We're always going to be a little bit cheaper, going to be a better on the shelf availability or better lead times.

But that doesn't make sense when you're paying book price for an aircraft.

You can't really do that on a teardown side.

So you have to have some kind of shock to the system in order to make that supply available to us that we can go capture it and turn it around for us to make a profit and the operators to have a value decision to make as well.

So I think we're at an inflection point because of the supply situation.

There's also the demand, you know, weakened a little bit with the Middle East conflict as well as the other issues going on.

So I think it is a good point where you're going to see aircraft become available at the right price and at the right time.

Interesting, actually.