Airplane seats get used a lot.
In a typical cleaning week at Latitude Aero, we
go through over 10,000 Q-tips and over a
thousand toothbrushes.
They're pretty nasty when they come in.
We average 2 to 3 pounds of dirt removed from a
seat when it comes in versus when it goes out.
A commercial plane typically flies multiple
times a day, thousands of times a year for
several years before updating the interior.
That's where a company like Latitude Aero comes
in.
Most carriers replace or refurbish seats every 5
to 8 years.
They rarely get detailed cleanings in that period.
What the customer can see does get cleaned, but
down in the intricate workings of the seat,
they get pretty nasty.
Coca Cola, coffee, food scraps, human hair, DNA,
as we call it in house.
Aircraft seats do get a lot of wear and tear.
You have people slamming their bags on them and
they're sitting on them. People spill drinks on
them and they're you know, they're used all
day long. They do use heavy duty material, but
the material can rip and it could just get old.
And airlines don't want that to be the face of
the airline.
Aircraft interiors is a $6.5 billion business in
2022, the total seat market was $2.9 billion,
with new seats at almost a billion and retrofitted
seats at 1.4 billion.
Now that we're seeing airlines, some airlines,
especially in North America and Europe,
return to profitability, they're starting to spend
more on interior retrofits.
We visited a refurbishment company in
North Carolina to see what goes into giving
airplane seats a second life.
Seats are a crucial part of an airline's business.
A typical narrow body jet like a Boeing 737 or
an Airbus A320, has as many as 180 seats.
And replacing them with brand new seats can be
expensive. A more complicated seat with an
in-flight entertainment screen power outlets and
a reclining mechanism is more costly.
Your typical economy class seat is around
$5,000 per seat.
As you move towards the front of the aircraft's
business class seats with the closing doors
and everything that might be 70 to $100,000
per seat.
We can do projects in as few as ten days for less
than half the price.
Many airlines choose to refurbish or refresh the
seats by stripping down the ones they already
have in service or have acquired from another
airline or leasing company.
It does depend on the airline. It depends on
how much wear and tear.
But a big refresh of a cabin is about every 6 to
7 years.
If you have a aircraft platform and that airline
knows they're about to retire in less than ten
years, but they just want to refresh the look,
then they might just update the seat covers
and keep the actual seat the same.
So we've seen that in cases like Delta just did
a refurbishment on their 767 fleet where they
installed a new premium economy cabin.
And then for business class up front, they kept
the same seats they've had for the last ten
years or so, but just updated the seat covers
and make it look a little bit more
refreshed.
Most of our business is taking seats that may
have flown for another airline and stripping
them down, repairing them and refurbishing
them back in the new livery of the the new
customer, the new airline.
Latitude Aero specializes in commercial aircraft
seating a small company compared to the bigger
seat manufacturers like Collins Aerospace and
Zodiac Aerospace.
But the business has been growing nonetheless.
Since inception in 2015, we have more than doubled
revenues and profitability year over
year. Over the past six months, our business has
changed a little.
Pre-pandemic, we did volume small orders.
Now we're seeing long term contractual revenue
2 to 3 years out.
In fact, we are booked now through April of
2025.
The company has delivered over 82,000 seats from
economy to business class for almost every
type of aircraft from Boeing and Airbus.
This year, it expects to do over 30,000 aircraft
seat refurbishments.
Originally, we shipped to airlines in 33 countries
globally out of our one location in Greensboro,
North Carolina. We are now dealing with multiple
US mainline carriers.
Airlines may choose to refresh seats instead of
replacing them to help keep costs down.
When you have very custom interiors like what you
might see on Emirates, their first class, which
is floor to ceiling suite, and there's only
maybe four seats in the entire first class cabin,
then you're well into the six figures.
That's a lot of engineering that goes
into it and certification work and
can take years to develop.
Replacing seats is expensive. It's labor
intensive, it's costly.
And when an airplane is on the ground, it's not
making money for an airline.
So when the airplanes are going to be down for 30
days for a c-check, a maintenance inspection,
they will take the interior out and do
projects. Then it's cost prohibitive for the
airlines to take an airplane down just for
the sake of changing out the seats.
If the airline's in maintenance and it makes
sense, the seats have to come out anyway.
That's our opportunity, our window.
So with the larger the airline, the longer lead
time we have, the more planning we have, the
smaller the airline.
Generally, they don't have as much back office
staff to help with material planning,
maintenance planning. So the smaller the airline,
the less lead time we get.
Boyette says they can do a project in as little as
ten days, but seats that are more complicated
could take upwards of 90.
This is how the Delta seats come into us.
They acquired aircraft from a different airline.
We bring the seats in, we strip them down to the
bare frame. And this is the base of how we start
rebuilding the seats.
Everything will be removed so we can reuse
it on the new seat. We recycle, reuse as much as
possible to eliminate landfill waste.
The next step will be taking the arms off.
The arms are not in the proper color to use in
the Delta livery, so they go to a local powder
coater to be repainted.
And then this is actually a spare seat.
So any parts that we can take off of this seat to
use on the refurbished seats that are behind
you, we can recycle, reuse as many parts as
possible. It looks like a simple seat.
A lot of people joke around and say seats are
easy. It's just fuzzy. Side up.
A component maintenance manual for your average
seat is anywhere from 800 to 1,000 pages of
detailed instructions on how to clean, take apart
and repair. Lie flat seats in the front, have
electrical actuators.
So the more complex the electrical system in the
seat, the more complex it is for us to
troubleshoot, repair and refurbish.
Not all seats are the same and can vary from
airline to airline.
The trend with airlines for a long time has been
seats without screens that aren't as
complicated, and American did that for the
most part. They're taking them out and
they've gotten simpler. And now United, for
example, wants to retrofit all of its
narrow bodies to have screens and Bluetooth and
all this modern equipment.
Most airlines are getting away from fabric.
Fabric is very hard to clean in the cabin.
There's some fantastic synthetic leathers on the
market now that do not stain from spilled
coffee, sweat and hot markets.
Human markets, the biggest trend in in the
refurbishment industry is adding power to the
seats. And now with Europe requiring usb-c
only USB a going away in Europe, we see a lot of
power outlets being pulled and being replaced
with Usb-c.
When we visited, the company was finishing up
seats for a Delta 737 aircraft.
The seats come in via 18 wheeler.
When they're finished, they're boxed up and
delivered back to the airplane. The company has
felt the effects of supply chain challenges.
There are times we can't find parts or the
manufacturer of a specific seat part has
gone out of business during the pandemic.
We have the ability with our in-house machine shop
to make parts for the mainline carriers.
Much of the global air fleet was grounded in
2020. Several large airlines are profitable
again, but the industry is still recovering from
the impacts of the pandemic, and the outlook
for the interiors market, including seats,
is expected to keep growing over the next
several years.
We're waiting for more airlines to make money
again before. Or they spend money on interiors.
And there's a there's a cyclicality to it as
well, depending on when certain fleets were
delivered. We're looking towards mid-decade for
interior refurbishment wave based on those fleet
demographics and timing.
Boyette says his shop is at capacity and has
orders into April of 2025.
One of the largest US carriers has the world's
largest refurbishment project in the history of
aviation. Coming up, that kicks off in April
for over 500 airplanes, and we're thankful enough
to be awarded a good portion of that order, he
said.
Demand is so high that his main line customers
are asking the company to expand beyond seats.
Later this year. We are looking at getting into
the plastics piece of the interior, the side
walls, the bins, the PSUs.
We're also looking into carpet and lavatories and
galleys for 2024 and beyond.