Don’t go breaking my part

opinion

by Alasdair Whyte

September 6, 2024

One of the rules of buying an aircraft is that you do not want to be the last owner. It can be an expensive lesson when you discover that a fantastic cheap purchase price is more than outweighed by maintenance costs.

But as with other rules, there are exceptions.

If you know what you are doing, it can be a great business. Ben Murray, CEO and president of Skyservice Business Aviation certainly thinks so.

“When you start to study the market and you look at how many older airplanes are in service and need support, the opportunities are huge,”says Murray. “The lack of supply chain and long lead times for repairs and overhaul, owners sitting there wondering, ‘what am I doing?’ They have major inspections coming and the amount of the inspections will in some cases far exceed the whole value of the airplane.”

Skyservice is now accredited by the Aircraft Fleet Recycling Association’s (AFRA) Best Maintenance Practices for Disassembly and is making this a new focus. Murray wants to provide solutions for Skyservice’s owners, and others, looking to retire their older aircraft.

It is happy to buy the aircraft or dismantle them in partnership with owners, storing and selling parts. “We have the financial capabilities to inventory our own aircraft or work with owners to sell aircraft parts,” says Murray.

The post-Covid boom was a frustrating one for people who make money taking aircraft apart. On the one hand, there was massive demand for parts because of supply-chain delays. But people were desperate to buy and fly older aircraft that would normally have been parted-out.

“Things are changing now, but in the last prior three years it was almost impossible to purchase anything for disassembly,” says Greg Miller, founder, M4 Aviation Group. “As pricing has decreased that has opened the window back up.”

Miller launched M4 in 2017 and specialised in buying aircraft for their engines and then dismantling the rest of the aircraft. Since 2020 he has become increasingly involved in busy buying and selling aircraft for people who want to fly.

“The serviceable aircraft transactions have blown up for me,” he says. “It has been difficult for me to keep up.”

Miller is now also looking for aircraft to break up. So far this year he has worked on one Challenger 601-3A and two Lear 60 part-out transactions. He pre-sold the engines then sold the airframe to parts companies. Miller is seeing demand for a wide range of engines and parts including Phenom 300, Falcon 2000EX and Citation XLS+ aircraft.

Murray is confident that aircraft recycling can become a sizeable business for Skyservice – alongside its aircraft management, charter, MRO and FBO divisions (it is about to open new FBOs in Seattle and Fort Lauderdale).

Aircraft recycling is a business that rewards experience. You can lose a lot of money if you buy the wrong aircraft. Experts are constantly watching to see which aircraft others are taking apart to make sure there is not an oversupply of parts.

Murray first got involved in parting out aircraft more than 10 years ago. He and Miller know that breaking up is never easy.