Charles Willis Aspires To Grow WLFC Aftermarket Revenue

FORT WORTH—Willis Lease Finance Corp.’s founder would like to expand aftermarket revenue to 50% of overall revenue, but that might be hard to do.

“About five years ago, I said I wanted to see more of our business in aftermarket services,” says Charles Willis, who founded the company in 1985 and is the executive chairperson. Today, service businesses represent about 15% of WLFC’s revenue, he says.

“I’d like it to be 50/50 because we get tremendous tax coverage by virtue of all of the engines that we buy, so it’s nice to have services that can offset that taxation,” says Willis, speaking at Aviation Week Network’s Engine Leasing Trading and Finance Americas event here.

The book value of WLFC’s assets is more than $3 billion, a figure that was $1.5 billion in 2016.

Willis views aftermarket services as very synergistic to the leasing business and critical to the company’s operation as it vertically integrates—from pre-purchase inspections to end-of-life solutions.

In addition to its parts business, Willis offers aircraft maintenance, storage and disassembly at Teesside International Airport in the U.K. (established in 2020) and engine repair centers in Coconut Creek, Florida, and in Bridgend, Wales (established in 2018/2019). It also offers asset management consultancy (established 2016).

Lessors expanding into services is definitely a trend, as owners seek ways to maximize the value of their assets and control more of the supply chain. “Copying is a divine form of flattery: whenever we do something, like getting in the parts business (in 2013), other people decide to get into the parts business,” Willis says. But the “synergistic businesses really have made a big difference,” he adds.

Growing aftermarket revenue to 50% “could take quite a while” because its engine portfolio is expanding. “If you’re buying $750 million to $1 billion [of engines] per year, it’s hard to meet that revenue with your services,” Willis says.

So, Willis’ service might not get to that 50% figure in the near term, “but it will be a major part of the business going forward, as it has been,” Willis says.