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Private jet owners are cashing in on a supply chain crunch by leasing their engines to people facing long waits for their own aircraft to be repaired.
The aerospace industry has been plagued by labour and parts shortages since the Covid-19 pandemic, leading to protracted delays in deliveries of engines and aircraft for both private and commercial jets.
Wealth advisers and industry experts said some owners wanted to rent just the engine because they were attached to their customised jet interiors, which can include gold and marble bathroom fixtures and large cinema spaces.
Laura Uberoi, head of private wealth finance at law firm Addleshaw Goddard, said: “It’s the first time in my career I have seen families turning a profit on their private jets, which are usually a depreciating liability.”
To hire a mid-size jet engine for a couple of days would cost about $50,000, and the engine could be removed fairly quickly, even overnight.
“Typically people didn’t do that in private jets, the jets are in busy use,” but the practice has been increasing for the past five to eight years as the commercial incentive has made it worthwhile, Uberoi added.
Kevin Michaels, managing director of AeroDynamic Advisory, said there was “a well-known issue with small propulsion engine supply chain” which was delaying maintenance and repairs. Business aviation operators typically had small fleets and few stocked spare engines, he added.
“Turnaround times are averaging four to six months and sometimes eight to 10 months versus two to three months typical,” he said. “This adds to the demand for exchange engines.”
Pratt & Whitney, Rolls-Royce and Honeywell are the biggest makers of business jet engines.
Increased demand is worsening the situation. “The number of flights in business aviation is up more than 30 per cent compared to pre-Covid levels,” Michaels said. This had taken some aircraft manufacturers “by surprise” and “their supply chains are trying to catch up”.
Daniel Hall, senior valuation consultant at Cirium Ascend Consultancy, said business aviation was suffering from the same problem as commercial jets — supply chains, parts, facility capacity — but also “a dwindling supply of aviation maintenance professionals . . . a sector which young people are no longer entering”.