After several years of addressing unusually extensive internal demand, Delta Air Lines is poised to shift more of its aftermarket support resources to third-party work, CFO Dan Janki said.
Speaking during the carrier’s recent investor day, Janki said much of Delta TechOps’ broad capabilities were needed to help the airline build up following the 2020 downturn. From addressing deferred maintenance events to getting parked aircraft back into service, the downturn expanded the TechOps team’s workload beyond routine fleet support needs.
The added workload is easing somewhat, however, opening the door for TechOps to grow its third-party activities.
“As we’ve rebuilt the airline, we prioritized Delta and Delta’s customers and Delta’s operation. That has been at the cost of growing our third-party capability,” Janki said. “But now we’re in a place where we’re more balanced around that. And I think as you see us go into 2025 and beyond, you’ll start to see that growth start to happen.”
Delta’s TechOps’ business was generating about $1 billion in annual revenue coming out of the downturn. Executives have said the extensive MRO operation has the potential to be a $5 billion annual business.
While growth has taken a back seat to Delta’s internal needs, TechOps has been expanding its capabilities. It has leveraged new-aircraft purchases to win coveted overhaul network partner status on several current-generation engine programs, including the CFM Leap 1B, Pratt & Whitney PW1000G, and Rolls-Royce Trent XWB. It has invested in infrastructure as well, notably adding a large turbofan engine test cell in 2019.
Mix in the company’s extensive capabilities on legacy platforms and Delta TechOps is ideally positioned to benefit from both the need to support legacy variants as new-aircraft delivery delays are worked out, and the emerging demand for work on current-generation aircraft and engines.
“As you look out at the long term of third-party services, how we’re positioned on the next generation and also [our] deep capability with legacy capability, we’re uniquely positioned,” Janki said. “Our long-term aspirations haven’t changed around that.”
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