Podcast: CFM Leap Engine Ramp-Up, Durability And Spares In 2025

Aviation Week editors Sean Broderick, James Pozzi and Lee Ann Shay discuss CFM Leap 1A and 1B engine developments, from newly certified blades that should be better suited to harsh environments to expanded aftermarket prospects, production ramp-up and engine spares.

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Transcript

Lee Ann Shay:

Welcome to the MRO Podcast. I'm Lee Ann Shay, Executive Editor for MRO and Business Aviation for Aviation Week. Today's subject, the CFM Leap program, which is generating some significant news, including engineering dust, but more on that later. As background, there are about more than 3,500 CFM Leap powered aircraft in service today, but that fleet should double by about 2030, according to Aviation Week fleet and forecast data. And Safran won half of the CFM joint venture, along with GE, has forecasted that LEAP deliveries are going to increase by about 15% to 20% this year. So that's good news for everybody. To discuss this market, two of my colleagues who have been covering this are joining me. James Pozzi, our MRO Editor for the EMEA Region, and Sean Broderick, Aviation Week's Chief Safety Officer. To start off, let's start talking about durability issues. Sean?

Sean Broderick:

Sure. So as readers of Inside MRO and listeners to this podcast know fairly well, we have a couple of engine programs with some notable durability issues that are causing headaches for affected operators. And the top of the list is the geared turbofan in the Trent 1000. But the Leap has not been without its teething issues, let's call them, and overshadowed by the problems of the other narrow body engine that it competes against there, the geared turbofan. CFM has been dealing with a handful of issues, really since pretty much their entry into service. And so we're talking August '16 for the Leap-1A, a May '17 for the LEAP-1B. That's when they started rolling out.

Four things, really, I think are worth talking about on the durability side. And two of them are old news, very old news. One of them, high pressure turbine stage one shrouds, so the casing around the blades, if you will. Very high temperature, very harsh environment on the inside of the engines from temperatures and what the shrouds were exposed to. So they've been having coding issues on those things, really since the beginning, since entry into service. Started rolling out improved coatings on the shrouds in 2019. About 70% of the affected fleet... So, again, that wasn't the whole fleet because they did a line fit on some of those. More than 70% of the effective fleet has been retrofitted. Bearing upgrades on driveshafts, the second one, that addressed some issues with the bearing that was linked to some 737 MAX, that's Leap-1B engine, in-flight engine shutdowns. They're almost all done, about 95% of that affected fleet is done.

The two newer ones that we've been writing about over the last year are the bigger news that's affecting the fleet today and that's affecting durability today. One is the coking issue, related to carbon buildups around the fuel nozzles. So CFM has developed and certified and is delivering a reverse bleed system, first for the Leap-1A, that eliminates the need to require fuel nozzle changes between overhauls. Big deal because changing a fuel nozzle, or a set of fuel nozzles, 18 on the 1B, 19 on the 1A because it's a little bit bigger engine, not a small project. So by eliminating the coking issue, and allowing the fuel nozzles to stay on between full overhauls, helpful with on wing time, keeps the engine on the wing where it belongs.

But the RBS itself isn't exactly... It's an innovative fix, but it is a... And, again, not an insignificant addition to the engine. Started rolling those out on the new engines beginning of the second quarter last year, I think. Certification for retrofits began later in the year. And kits were rolling out, last time we checked on this and got numbers, it was around the time of MRO Europe in Barcelona, and the kit orders and installations were really beginning to ramp up. We will have... James in the middle of writing a big feature story for the magazine that I'm contributing to, and I'm hoping to have an update on where we are. And that's beginning of 2025, in terms of kit orders and rollouts for that story.

Last one is the new high pressure turbine blades. Another big one, relates to the dust issue that Lee Ann talked about. This is about improving performance in harsh environmental conditions, so think dust and pollution, primarily the Middle East, Asia. But, again, impact, I think any operator would say that they've been impacted by this. 1A blades certified at the end of 2024. 1B blade hopefully coming about a year later. Again, it's the development of these things mirrors the entry into service of the engine. So those kits are shipping, but both new engines and MROs are getting them to put them... Or production line has them, MROs are getting them. So CFM says that's going to double the durability of those blades, more than double the durability and harsh environments. So those are really four big things that are going on.

Big deal for the MRO network that James is about to talk about because, again, we're seven, eight years in, nine years in. So really at the beginning of heavy overhauls, but they've had more issues going on that's required MRO ramp up. And I think, again, and that's why there's been so much activity on that side that CFM has pointed to, at what is really still an early stage in the program on the aftermarkets. Well, even on the OE side, eight, nine years in.

Lee Ann Shay:

Thank you, Sean. And I do think it's very cool that CFM worked with a team of geologists to engineer the dust to mimic what these engines were doing, and they have used a proprietary dust ingestion system. I can only think of this as a big vacuum cleaner, but there we go.

Sean Broderick:

Yeah. In Evendale, yes, they did. Yeah, they put a lot of work into mimicking what their operators are seeing. And they really had to get that right to ensure that the product development was right. So, yeah, it's great tangential story on the development there. Yeah, absolutely.

Lee Ann Shay:

Cool, thank you. And switching gears over to James, like Sean mentioned, you have been researching and writing our next big cover story for Insight MRO. What insights about the LEAP program have you gleaned?

James Pozzi:

Well, it all points to growth, I think it's fair to say. Sean obviously detailed some of the issues there with the durability and the impacts of the aftermarket, amazingly, several years now into the program. But he is right as well, it is still relatively young, in terms of the MRO side, with a lot of the really heavy maintenance checks still to come, of course.

So let's look at both partners in the CFM international joint venture, Safran and GE Aerospace. In the last year, both have committed huge sums, specifically for the aftermarket networks, to build them up, and add capacity, and everything else that would entail, i.e. personnel, tooling, equipment, et cetera. So Safran, obviously, last year, in October, committed to a billion euros, which amazingly now, given the strength of the US dollar, is around just above a billion dollars. And GE, obviously, has a commitment as well. I think it was announced at Farnborough last year for one billion US dollars into its MRO shops around the world and areas like component maintenance as well.

So some of the numbers, not to, I guess, attempt, or I will attempt my best Dan Williams impression here, look at some of the numbers, but from the Safran side. They've predicted, I think, the year coming up, 1,725 LEAP shop visits. And if you compare that to their numbers from 2023, where it was 725 approximately, that shows the real sharp ascent in those numbers. So it's inevitable there will be more MRO providers in the open network over time. Of course, shop visits also lead to perhaps additional work scopes when the engine's opened up. So there's a real opportunity there for work. And Safran also said they have predicted that they think third party MRO providers could account for around 30% of the LEAP market by 2030, climbing to over 50% by 2040. So that, I guess, maps out the growth over the next 15 years or so.

Let's look at some of the things they are doing. So on the Safran side, they've obviously recently opened a Brussels LEAP shop, which we spoke about last year, Lee Ann, you and I with Thierry Dubois, who visited that for a previous podcast. And there's also been plans recently, all parts of the world really recently, to open shops. So there's Casablanca and Morocco, I think, by 2026. Of course, Hyderabad in India, there's been a lot of attention on that. I think that could be online by late this year. A second MRO shop in Mexico. And, of course, building some additional facilities in its French home base, of course, where Safran is headquartered.

So, yeah, lots of internal MRO investment, but also a lot of the noise does point to third parties outside of the initial network. Of course, unlike the GTF, the LEAP model is, they say, an open network. Last year, they rebranded five MRO providers who are now part of their MRO Premier brand. So that's obviously Lufthansa Technik, Delta TechOps, StandardAero, ST Engineering, and Air France Industries KLM Engineering & Maintenance. Will this grow further? I spoke to an analyst this week, and he thinks that the licensing program, I think, currently, consists of, I think, eight people altogether. Those mentioned, and I know Israel Aerospace Industries have a license as well, although they're not part of the MRO Premier network. But they anticipate, at their consultancy, that CFM will likely license another three to five engine MRO suppliers over the next few years, he said, so maybe two to three years. So that'll be interesting to see how that further grows. But, yeah, I think the immediate work that the OS installations are taking place at shops now that that's keeping a lot of people busy.

Also, some of quick turn hospital shop demand that'll come before the overhauls obviously, which brings me on the topic of quick turn and hospital shop visits onto a company that, by the time this podcast is live, I would've visited out in Cyprus. That's United Aerospace Maintenance Company. They're a bit of a new player in the LEAP repair market. They were established last year out in Larnaca. And they're focusing on LEAP-1A and LEAP-1B repairs. And they'll undertake work as part of an offload agreement for GE on those engines, and undertake, I think, 12 engines in 2025, they expect to induct. But this will multiply over the next two years and reach between 36 to 48 engines. Interestingly, after that two year period, they may look at the possibility of adding overhaul and testing capability for LEAP, while also potentially exploring other engine types to add to their certifications as well there. So that's definitely one to watch as well and see how that grows and develops over time.

And, of course, as mentioned, by the time this podcast is live, there'll be plenty of stuff online, which I would've written from the trip. So you can check that out on aviationweek.com. Yeah, and as I said, this will reflect how the immediate work over the next few years will go. There'll be a lot of quick turn demand, highlighted by some of those shop visits figures I mentioned earlier from Safran for the LEAP engine. And then that'll continue to grow before the engine matures, of course. And demand is there for overhauls, which seems to like it's really going to pick up, I think, later in the decade. I've got 2027 onwards and around that time, when the fleet, obviously, really grows, and that first wave of overhauls comes to fruition. So, yeah, we'll see really how that all bears out. But, yeah, expect growth in the network, I think it goes without saying. And that applies, of course, to the 1A and the 1B, which will really drive this for, obviously, the Airbus A320neo and the Boeing 737 MAX aircraft.

Lee Ann Shay:

Thanks, James. One thing I wanted to jump back to was, we've mentioned ramp up for production a couple of times. And I think we need to point out that this engine program has one of the fastest ramp up programs ever. We've got 3,500 engines that have surpassed 60 million flight hours, which is a heck of a lot of engines. But because there's a whole lot of engines, they've had a few durability issues, but there's been a little bit of a push and pull between where the engines go. Do they go to the OEM for a new aircraft, or do they go to the aftermarket for spares? And there's been some interesting news, I think, there on the spares front. James?

James Pozzi:

That's mentioned in the feature, actually. That's going to provide a challenge, definitely. Where do these engines go? Who has them? Because there will, ultimately, be some people who are disappointed by that. Very recently, Lee Ann, I know we spoke about it the last week, and a colleague, Alex Derber, wrote an article looking at the LEAP spares. Now, they've been very, very hard to come by for several issues, mainly around the production and the market demand that bears out. And it's very hard to have a LEAP spare engine, unless you're a very lucky operator. Yeah, recently, AFI KLM E&M, as I mentioned, Alex wrote the story, where they purchased 10 LEAP engines. Of course, they're an MRO Premier member company. And, yeah, so they will have those engines now.

And some of the figures around them... And that's spares, obviously, for their network. But some of the figures around that are pretty mind-boggling, it's fair to say. So in the article he speaks to Richard Hough, who, of course, is the CEO of ELFC, the Irish lessor, Engine Lease Finance Corporation. And he said lease rates for the CFM LEP, and to be fair, the Pratt & Whitney GTF as well, the competitor engine, they're running at above $200,000 per month, which is more than double the rates for the previous generation of engines. You think the CFM56 and, I guess, the VT500 as well would be bunched in with that. And he does counter that by saying, "One has to consider that these engines cost well in excess of $20 million to purchase as spares," which is true. But those rates are very, very high, of course. And the spare engine demand isn't going to really abate. I guess, we've heard some encouraging things about production ramp ups this year. Again, that could loosen the engine market up a bit.

However, that's an interesting conundrum we're in now, because the point was also raised that the demand for these spares are so high that aircraft lessors could make almost as much from removing and leasing the engines from an A320neo or a Boeing 737 MAX than they could from leasing the aircraft as a whole. So it really shows, I guess, where the direction is in terms of the buoyancy, I guess, of the engine market, but also the inflated demands, the pricing and everything like that. And, obviously, that is a bit unsustainable, long term. So I think increasing production ramp ups, as I mentioned before, could maybe be a remedy to this issue in the market.

But I'd be very genuinely interested, we often look ahead and say, "One year from now," or, "Further down the line." But in this case, I'm genuinely interested one year from now in January 2026, will there be a greater abundance of spare engines? Will this be remedied at all? Because the noises are that there could be some positive signs this year, but also the market seems pretty certain that supply chain challenges, for example, are going to continue. Safran noted, quite recently, that it does expect to see an improvement in critical component production rates in 2025, which, of course, is good. So that'll have a simultaneous ramp up in the deliveries, you'd imagine. And MRO shop visits will happen as well. But, of course, this could present dual challenges, in terms of supply chain. And the belief, unfortunately, seems to be that this maybe won't drastically improve this year. There could be more moderate improvements as well.

And another thing, actually, to look ahead to, I think, Lee Ann, is TATs. Obviously, I mentioned earlier in the podcast we did on the LEAP a few months ago, couldn't really agree on... We'd all heard conflicting things about the lead times for engine repairs. I'm very interested as to how that's going to go this year because, as with other areas, there's been moderate improvements there. But that is still a challenge, that is still an issue. And it's something the industry are very wary of, in terms of planning forward, and having to navigate this particular challenge as well. So something to keep an eye on as well.

Sean Broderick:

Lee Ann, before we get out of here, to put in context for the listeners how fast the fleet is growing, twice as fast as CFM56. So we're approaching 8,000 LEAP engines in service, more than 3,500 aircraft out there. Shop visits on the CFM56, which are still growing and aren't going to peak, and we still see that as a relatively robust market, LEAP shop visits are actually, counting the hospital visits, which is important, are going to surpass CFM56 annual shop visits by sometime in the second half of the decade. So it gives you an idea of why this network is growing, why places like Cyprus are getting online so quickly. It is not just to deal with these durability issues, but it's also just to deal with the sheer amount of volume in the market.

Lee Ann Shay:

Absolutely. And since we're clarifying things, I think, Sean, I think I introduced you as our Chief Safety Officer when, in fact, you are our Senior Safety Editor. So sorry about that.

Sean Broderick:

It's okay. I do the best I can.

Lee Ann Shay:

But, James, you mentioned turnaround times and lead times and spares. All that, I guarantee is going to be coming up at Aero-Engines and Americas, which is going to be January 27th, 29th, and we hope to see you all there in Dallas. We've run out of time for now. Hate to cut this off but, James and Sean, thank you so much for your insights. And a big shout-out to Cory Hitt, thank you for producing this podcast. And that's a wrap for this episode. Don't miss the next one by subscribing to the MRO Podcast wherever you listen to them. And one last request, if you are listening in Apple Podcast, please consider leaving us a star rating or writing a review. Thank you so much, and have a fabulous day.