USM and You: How Airlines Can Benefit from Used Serviceable Material

In the aviation aftermarket today, there is a large surplus of used serviceable material (USM) available to airlines. Aircraft retirement is the key driver of this influx of USM, as airplanes produced 25 to 30 years ago reach the end of their service life. USM is repairable, life-limited parts with “green” time left, and some $4 billion of those parts are consumed annually in the USM market. This is a positive benefit for airlines looking to reduce and contain maintenance costs. As a result, many airlines are integrating USM into their maintenance strategies, enabling them to bypass OEMs and their annual price increases and part availability issues entirely.

Benefits of USM

The primary advantage of USM is cost. On average, a USM part can be 60 to 80 percent of the price of an OEM new part. However, prices can and do fluctuate based on a variety of factors – especially if the part has significant useable time left on it or is in high demand. USM can be cost-effective in cases where the repair and overhaul costs of rotable components exceed the costs of a simple replacement. With 70 percent of the cost of engine overhauls made up by parts, minimizing these costs with USM makes financial sense without compromising safety or quality.

Another benefit of USM is availability. With so many aircraft being retired, the chances of finding the part you need at the price you want are much higher. If an OEM has supply chain issues, USM may make the difference between a quick return to revenue service or an extended maintenance grounding.

Fly, Park, or Part?

The other side of the USM equation is determining when an airplane becomes a candidate for teardown. Not surprisingly, airplanes for USM sourcing are older or close to retirement, along with engines that are 12 or more years old. Again, several variables come into consideration when deciding if the value of an airplane’s parts are greater than the costs to keep it in revenue service.

• Where is the airplane in its life cycle? Is it pre or post C and D check? Cycles, hours, and the calendar drive the costs of a service life extension.
• Is your airline adding or decreasing its route structure? Do you need future capacity?
• What is the airline’s cash position?
• Does the airplane require a significant technology upgrade like fuel tank inerting or ADS-B Out?
• Is the airplane surplus inventory?
• Can the airplane be cannibalized to keep other planes running?
• How much time is left on life-limited components like compressor and turbine wheels? The value of these parts depends on how much “green” time is left on them since they cannot operate beyond their service limits.
• If USM prices are low, is it better to park the airplane until demand increases and part prices go up?

Paper for Parts

Another key aspect with USM is documentation. It is critical that every airplane part is legal, certified, and traceable 100 percent of the time. This is highly controlled by government aviation authorities. Serviceability documentation – such as an FAA 8130 tag or an EASA Form 1 tag – proves the airworthiness of a part. It is a record of the part’s history, including who owned or operated it. By providing details about what work has been done on the part and who did it, the safety and quality of the part is guaranteed. A part without traceability raises serious questions about its legitimacy and how it was maintained.

AerSale^® Is Your USM Provider

Many airlines are incorporating USM into their maintenance plans to drive down costs. With the increasing availability of USM in the parts market, it is an option that makes business sense without jeopardizing safety or quality. Where will you get your USM parts? The answer is AerSale.

AerSale maintains one of the largest global USM parts inventories to accommodate aircraft and jet engine parts sales for the world’s most populous fleets. All of our customers receive the highest quality parts, unsurpassed service and attention, and unparalleled certification and trace documentation for every asset transaction. As part of AerSale's commitment to quality, suppliers doing business with us must also meet our stringent requirements.

With more than 700,000 line items of airframe inventory, over 30,000 unique numbers for aircraft parts, and 20,000 unique engine part numbers, AerSale can keep your aviation assets working for you profitability from first flight to final flight.

About AerSale

A global aviation leader celebrating its 10-year anniversary, AerSale specializes in the sale, lease, and exchange of used aircraft, engines, and components, in addition to providing a broad range of integrated maintenance, repair, and overhaul (MRO) services and engineering services for commercial aircraft and components. AerSale also offers asset management services to owners of end-of-life aircraft and engine portfolios. Headquartered in Coral Gables, Florida, AerSale maintains offices and operations in the United States, Europe, and Asia. For more information visit www.aersale.com.