We’ve seen significant transitions across global fleets over the last few years.
Social events and market shifts have shaken up airline holdings,
causing many aircraft to be phased out. You probably know at least a few factors,
but in today’s video, let’s take a look at what the driving forces are behind these retirements.
While flight cycles and age are monitored ahead of an aircraft's retirement, the analysis is not
primarily related to an aircraft's structural performance. Indeed, the underlying factor is
cost. An aircraft will be retired when it becomes economically unviable to run.
Operators concentrate on internal factors when decommissioning a plane.
Aspects include fleet planning and organizational & strategic transformations.
Owners are driven by the opportunities in the industry and the value of the aircraft.
This process usually occurs when events such as expensive maintenance checks are due.
SGI Aviation shared the following in a 2018 report:
“Analysis revealed the following retirement drivers:
The effect of changing oil prices is noticeable on aircraft retirements
and therefore is one of the main drivers for aircraft retirements; development of new aircraft
models with improved technology has a significant impact on the aircraft retirement activities;
components which are high valued and are in demand can also influence the retirement curve."
Oil crises such as the 1970s oil embargo have seen airlines rapidly phase out aircraft in a
bid to save on fuel. Fuel prices will see further fleet transformations this decade.
More and more these days, there is pressure on airlines to adhere to climate
and emissions targets. However, sustainability goals run in line with carrier cost-saving goals
as lower emissions equal lower fuel burn. We’ve already seen airlines replace staples
in the A320 and 737 families with neo and MAX aircraft due to the fuel cost savings to be had.
Moreover, quadjet powerhouses such as the A380 and 747 have been making way for modern twinjets
such as the A350 and 787 due to similar reasons. Retirements will continue to catalyze following
the arrival of viable hybrid-electric solutions. The likes of Airbus have been investing heavily
in this field in a bid to introduce the world’s first zero-emission aircraft by 2035.
Additional global events such as the COVID-19 pandemic have also sparked mass retirements.
With the majority of aircraft grounded during the early months of the health crisis,
airlines saw the opportunity to streamline fleets during the downturn,
something they struggle with during busy periods. Nonetheless, world events can also prolong
aircraft activity. For instance, the attacks of 2001 and the 2008 worldwide recession saw a drop
in demand for air travel and left many operators tight on cash to place orders for new models.
In the years five years leading up to the pandemic, the average age of a passenger jet
before it was retired had been approximately 23 years. Amid rising fuel costs between
2010 and 2014, many planes were swiftly replaced by modern solutions. As a result,
the average age of a retired jet dropped to 22.8 in 2015 from 27.5 in 2005. Overall,
we can expect most recent purchases to stay in action until they become economically obsolete.
What are your thoughts about the factors that go into retiring aircraft?
Is it what you had guessed? Let us know what you think in the comment section.