Engine shop-visit queues start to ease, but the aftermarket has been repriced

The engine overhaul queues that grounded hundreds of narrowbodies have begun to shorten. Additional shop capacity has come online, parts availability has improved, and the inspection campaigns that consumed slots are past their peak. Turnaround times remain long by historical standards but are moving in the right direction for the first time in three years.

What has not reverted is pricing. The shortage demonstrated that overhaul capacity is genuinely scarce and hard to add, and contract terms signed during the crunch reflected that. Operators renewing agreements are finding the aftermarket structurally more expensive than before, with more risk transferred to them rather than the shop.

The strategic response is visible in the M&A record: engine OEMs and independents alike have been acquiring component-repair capability and parts distribution, on the view that controlling the pipeline matters more than owning shop floor space.

Our read: the operational crisis is resolving; the commercial repricing is permanent. When assessing an operator, look at how much aftermarket risk sits on its balance sheet versus its suppliers’.