As part of a strategic programme to expand its engines asset platform, APOC Aviation has purchased three CFM56-5A engines from PTS Aviation Inc. in Florida in a multi-million dollar transaction. One of the engines was acquired with a lease attached to German charter airline, Condor. The other two are currently in Miami and will shortly be integrated into APOC’s portfolio awaiting transition to customers.
Anca Mihalache, VP Engine Trading at APOC, is keen to point out the market strengths of the new additions. “Since launching our engine division a year ago we currently have four CFM56 model engines under lease, not counting the two 5As from PTS Aviation. We seek strong engines, with 2000+ cycles remaining and good EGT margins and these are ideal candidates. PTS Aviation is recognised as a worldwide supplier of serviceable aircraft engines, engine components, and engine inventory and APOC is pleased to partner with them on this deal.”
APOC’s engine programme allows for another five inductions before year end and these will soon come on-stream, not only feeding the lease pool, but also supplementing the new engine parts division which will complement APOC’s broader narrow body aircraft component sales, exchange and consignment facility.
Considering today’s market for the CFM56-5A Mihalache observes that performance of the engine type has been remarkably healthy for the past couple of years. “These engine assets have been strong players and the lease rates have been nice and stable. Of course, with the COVID-19 pandemic, older assets might retire faster, but our belief is that it will remain a robust market for the next three years.”
She continues by saying that although the aviation sector recovery will take longer than expected, there will be recovery. “Of course, the engines are the most expensive part of an aircraft but the expectation from operators is that the lessors will work with the airlines to accommodate a lower utilisation programme. But if a vaccine treatment becomes available at the beginning of next year, I do think the market recovery will start before the end of 2020.”