Herbert Smith Freehills Advises Airlink on Lease of 10 Embraer Aircraft

Nearly New Airbus Planes Scrapped to Salvage Valuable Jet Engines The global aviation sector is confronting an unprecedented challenge as nearly new Airbus A321neo aircraft are being dismantled to recover their engines amid a severe worldwide shortage. At Castellon Airport in Spain, several A321neos, some as young as six years, are being stripped of their prized geared turbofan (GTF) engines. These engines are subsequently leased to airlines struggling to maintain operational fleets in the face of limited engine availability. Supply Chain Disruptions and Market Shifts This unusual practice stems from a combination of supply chain disruptions and production delays, particularly at Pratt & Whitney, a leading engine manufacturer unable to meet soaring demand. Traditionally, airlines would retain older aircraft in service until replacements arrived. However, with hundreds of planes grounded due to maintenance backlogs and a scarcity of engines, the market dynamics have shifted dramatically. Firms such as eCube and Tarmac Aerosave have found it more profitable to salvage engines from relatively new aircraft rather than leasing entire planes. Currently, the monthly lease rate for a GTF engine is approximately $200,000—less than half the cost of leasing a full A321neo—making engine leasing an attractive option amid the acute shortage. Broader Industry Implications and Geopolitical Factors The engine shortage is reverberating throughout the global aviation market, exacerbated by geopolitical tensions and trade disputes. US-China trade frictions have delayed deliveries of China’s C919 jet, hindering its competitiveness against Boeing’s 737 and Airbus’s A320 families. This has intensified demand for single-aisle jets, prompting Airbus to increase production of its A320 series in China to expand its market share. Meanwhile, competitors are forging new partnerships; notably, India’s Hindustan Aeronautics Ltd has collaborated with Russia to produce SJ-100 jets, introducing additional competition for both Boeing and Airbus. The practice of dismantling nearly new aircraft for their engines is also reshaping airline and lessor strategies regarding aircraft storage and asset management. With the soaring value of spare engines, decisions about when and how to retire or store aircraft are evolving. For some operators, including Delta, salvaging engines from newer jets provides an innovative solution to navigate international tariffs and supply constraints. As the aviation industry grapples with these challenges, the dismantling of modern jets for parts highlights the volatility and complexity of today’s aircraft market. Persistent engine shortages combined with geopolitical disruptions to global supply chains are compelling airlines and manufacturers to adopt new strategies that may redefine the industry’s future landscape.

GE Aerospace and WZL-2 Sign MOU to Develop F110 Engine Maintenance in Poland GE Aerospace and Poland’s Military Aviation Works (WZL-2) have formalized a Memorandum of Understanding (MOU) to collaborate on the maintenance, repair, and overhaul (MRO) of the F110-GE-129 engine, which powers Boeing’s F-15EX Eagle II fighter jet. The agreement, signed in Warsaw by WZL-2 CEO Jakub Gazda, Technical Director Zbigniew Matuszczak, and GE Aerospace F110 Product Director Sean Keith, seeks to enhance Poland’s domestic capabilities in servicing this critical engine. Strengthening Local Maintenance Capabilities The MOU outlines a joint effort to evaluate the requirements for intermediate and depot-level maintenance, encompassing tooling, machining, training, and modifications to test cells. Sean Keith highlighted the F110 engine’s legacy, noting its more than 40 years of continuous production and innovation. He emphasized the engine’s design, which facilitates maintenance through Shop Replacement Units (SRUs) that allow approximately 90% of servicing to be conducted locally. This approach aims to reduce aircraft downtime and lower lifecycle costs, thereby improving operational efficiency. This partnership emerges amid robust market confidence in GE Aerospace, underscored by a recent $5 billion contract awarded by the U.S. Air Force for F110 engines. While the collaboration promises significant benefits, it also presents challenges, including adapting maintenance processes to Poland’s specific operational environment, ensuring supply chain stability, and navigating complex regulatory frameworks. Expanding Training and Technological Development The agreement with WZL-2 builds upon GE Aerospace’s recent collaboration with Warsaw’s Military University of Technology (WAT), which focuses on advancing engine training and education for the F110-GE-129. This initiative also explores the establishment of an Aircraft Engine Additive Manufacturing Laboratory, signaling a commitment to integrating cutting-edge technologies into Poland’s aerospace sector. The F110-GE-129 engine delivers 29,500 pounds of thrust and is actively deployed within the U.S. Air Force’s F-15EX fleet. With over 11 million flight hours logged, the engine powers both F-15 and F-16 aircraft across the U.S. military and 16 allied nations, including Türkiye’s KAAN fighter program. As GE Aerospace and WZL-2 advance their cooperation, they will contend with increasing competition in the small turbofan engine market from industry rivals such as Pratt & Whitney and Honeywell. GE Aerospace’s Longstanding Commitment to Poland GE Aerospace has maintained a significant presence in Poland for more than three decades, employing over 2,000 personnel across six locations. Since 1992, the company has invested approximately $700 million in the country, including an annual $50 million dedicated to research and development. This sustained investment underscores GE Aerospace’s strategic commitment to supporting and expanding Poland’s aerospace capabilities.

AerCap Report Highlights Tourism’s Role in Aviation Leasing Recovery AerCap Holdings NV, the world’s largest aircraft leasing company, has emphasized the pivotal role of tourism in the aviation sector’s gradual recovery, as detailed in its latest quarterly report for 2025. Serving over 300 airline customers worldwide, AerCap continues to assess the enduring impacts of the COVID-19 pandemic, shifting geopolitical landscapes, and the evolving dynamics within the aircraft leasing market. Tourism as a Catalyst for Leasing Demand Tourism remains a fundamental driver of passenger air travel and, consequently, the demand for leased aircraft. The report highlights that easing travel restrictions across key regions such as Europe and Asia have contributed to a rebound in passenger numbers. European governments, in particular, have facilitated this recovery by implementing relaxed travel protocols and introducing vaccine passports, which have bolstered both commercial and cargo aviation sectors. Nevertheless, the recovery is uneven across different markets. Variations in government policies and economic conditions have resulted in disparate levels of tourism resurgence. While some regions experience robust growth, others continue to face challenges, complicating long-term forecasting and strategic planning for aviation leasing companies. Ongoing Industry Challenges Despite encouraging signs, AerCap identifies several persistent challenges confronting the aviation industry. Rising fuel costs and ongoing supply chain disruptions are driving up operational expenses for airlines, compelling them to carefully balance fleet expansion with financial prudence. The report also underscores the increasing urgency of decarbonization efforts, a theme prominently discussed at the World Aviation Festival 2025. Environmental regulations and sustainability targets are becoming significant factors shaping leasing strategies and fleet management decisions. Geopolitical tensions further complicate the outlook. The protracted conflict in Ukraine and escalating instability in the Middle East have disrupted global trade and tourism flows, leading to diminished travel activity in affected regions. Sanctions, trade barriers, and currency volatility have exacerbated operating costs and heightened uncertainty for both airlines and lessors. Financial Restructuring Amid Economic Pressures The broader economic environment, characterized by inflationary pressures and regional economic slowdowns, has constrained airlines’ capacity for growth planning. In response, governments worldwide have introduced financial support measures, including subsidies and tax relief, aimed at stabilizing the tourism and aviation sectors. Within this context, the aviation leasing industry is undergoing significant financial restructuring. The recent bankruptcy court approval of the Spirit-AerCap agreement and debtor-in-possession (DIP) financing exemplifies ongoing negotiations and the necessity for flexible financial strategies. Market reactions to AerCap’s report have been mixed. While some investors express optimism regarding tourism’s positive influence on aviation recovery, others remain cautious due to persistent industry headwinds. Competitors are increasingly focusing on technology and innovation—topics highlighted at the Skift Global Forum East 2025—to adapt to evolving market conditions and position themselves for sustainable growth. Outlook for 2025 As 2025 progresses, AerCap and the wider aviation leasing sector confront a complex array of opportunities and challenges. The revival of global tourism remains central to the industry’s prospects, yet success will depend on effectively managing geopolitical risks, economic uncertainties, and the accelerating imperative for environmental sustainability.

Joby Aviation Stock Surges Following NVIDIA Partnership on AI Flight System Joby Aviation (NYSE: JOBY) saw its shares rise approximately 6% in early trading on Wednesday after announcing a strategic partnership with NVIDIA (NASDAQ: NVDA) aimed at advancing the development of its Superpilot autonomous flight system. This collaboration designates Joby as NVIDIA’s aviation launch partner for the IGX Thor industrial AI compute platform, which is built on NVIDIA’s latest Blackwell architecture and engineered for intensive, real-time edge processing. Enhancing Autonomous Flight Capabilities The integration of the IGX Thor platform is expected to significantly enhance Joby’s Superpilot system by enabling it to process substantially larger volumes of onboard data. This capability will facilitate near-real-time adjustments to flight trajectories, weather conditions, and air traffic interactions—features deemed essential for achieving certified autonomy in aviation. Additionally, Joby emphasized the platform’s predictive maintenance functionalities, which can identify early signs of component anomalies and flag potential issues before failures occur. This proactive approach aims to reduce aircraft downtime and improve overall operational readiness. Market Response and Industry Context The announcement was met with a positive market response, reflecting investor confidence in the partnership with a leading AI chipmaker. NVIDIA has recently expanded its AI-driven collaborations across various sectors, forging significant alliances with companies such as Eli Lilly, Palantir, Samsung, and Uber. This momentum has contributed to NVIDIA reaching a historic $5 trillion market capitalization, underscoring investor enthusiasm for its growing influence in artificial intelligence across multiple industries. Despite this optimism, analysts have issued cautionary notes regarding the intensifying competition within the AI chip market. While NVIDIA’s sovereign AI revenue is projected to more than double to over $20 billion this year, some experts warn that the company’s substantial valuation and the increasingly crowded AI chip landscape could affect its stock performance in the near term. Strategic Implications for Joby Aviation For Joby Aviation, the partnership with NVIDIA is anticipated to accelerate the testing and deployment of autonomous flight functions, potentially providing a competitive advantage as the company advances toward commercializing electric vertical takeoff and landing (eVTOL) aircraft. As the integration of advanced AI technologies in aviation gains momentum, both Joby and NVIDIA are positioning themselves at the forefront of a rapidly evolving and highly competitive sector.

Australia and New Zealand Launch Hydrogen Refueling at Airport to Advance Sustainable Aviation For the first time in Oceania, liquid hydrogen has been used to refuel aircraft at an international airport, marking a pivotal advancement in sustainable aviation. On October 28, 2025, Australia and New Zealand jointly conducted the region’s inaugural hydrogen refueling of experimental aircraft at Christchurch International Airport in New Zealand. This milestone involved pioneering companies Fabrum, AMSL Aero, and Stralis Aircraft, and represents a significant step forward in the aviation sector’s transition toward cleaner energy sources. A Milestone for Hydrogen in Aviation The refueling operation featured test aircraft specifically adapted to operate with hydrogen fuel cells. Stralis Aircraft deployed a modified Beechcraft Bonanza A36, while AMSL Aero contributed its own experimental model. Fabrum, a specialist in cryogenic solutions, supplied the liquid hydrogen necessary for the operation. This achievement demonstrates the growing feasibility of integrating hydrogen technology into the routine operations of commercial airports. Hydrogen is recognized for its high energy density and the fact that it produces zero carbon emissions during flight, positioning it as a promising alternative to conventional aviation fuels. However, its adoption requires the development of specialized infrastructure, rigorous safety protocols, and advanced storage and distribution systems. The successful refueling at Christchurch underscores the technical capabilities and commitment to sustainable innovation within the region. Strategic Trans-Tasman Collaboration Although the demonstration took place in New Zealand, Australia’s involvement was integral to the project’s success. The participating companies are based in both countries, and the initiative received technical and institutional support from both governments. This cross-border collaboration highlights Oceania’s leadership in aviation decarbonization and technological advancement. Australia has been investing heavily in alternative fuels and hydrogen infrastructure, while New Zealand is noted for its progressive environmental policies. Together, they are constructing a model for sustainable development that could serve as an example for other regions. The initiative aligns with both nations’ climate commitments to achieve carbon neutrality by 2050, addressing aviation’s contribution to approximately 2.5% of global emissions. Industry Impact and Global Context This development arrives amid growing global momentum toward sustainable aviation solutions. The market for sustainable aviation fuel (SAF) is projected to reach between USD 38 billion and 40 billion by 2034, reflecting an intensified industry focus on decarbonization. The hydrogen refueling milestone may stimulate increased investment in SAF and hydrogen technologies, while accelerating efforts by competitors worldwide to develop hydrogen refueling infrastructure or expand SAF production. Benefits and Challenges of Hydrogen Aviation Hydrogen is widely regarded by experts as a key fuel for the future of aviation due to its ability to generate energy without emitting carbon dioxide. Its principal advantages include zero carbon emissions during flight, high energy efficiency, the potential for renewable production via electrolysis, and a significant reduction in noise pollution. Nonetheless, several challenges remain. These include the high costs associated with infrastructure development and storage, regulatory hurdles, the complexity of adapting aircraft and engines to hydrogen fuel, and logistical issues related to transport and distribution. Despite these obstacles, major manufacturers such as Airbus and Embraer are actively advancing hydrogen-powered aircraft projects, signaling a broader industry shift. The successful hydrogen refueling at Christchurch positions Australia and New Zealand at the forefront of sustainable aviation, setting a precedent for global efforts to decarbonize air travel.

Emirates Leads Global Aviation Awards for Service and Passenger Experience Emirates has reaffirmed its position as a global leader in premium air travel by securing top honors for luxury, service innovation, and passenger experience at several prestigious international aviation awards. In a year characterized by rapid industry transformation and heightened passenger expectations, the Dubai-based airline received accolades from Forbes Travel Guide’s Verified Air Travel Awards, World Travel Awards, The Times and Sunday Times Travel Awards, and the Conde Nast Readers’ Choice Awards. Recognition for Excellence and Innovation For the second year running, Emirates was named Best International Airline, following an independent assessment involving over 9,000 luxury travel experts, hospitality consultants, and frequent flyers. This consistent recognition reflects the airline’s philosophy of continuous refinement, which permeates every facet of its operations—from airport lounges and inflight hospitality to digital travel support. Among its recent innovations is the introduction of a redesigned, lounge-style check-in area in Dubai exclusively for First Class passengers and Skywards Platinum members, setting new standards in premium travel experiences. Emirates also became the first airline to receive autism certification, having trained more than 30,000 staff members to better support passengers with autism and sensory sensitivities, highlighting its commitment to inclusive travel. Expanding Global Reach and Passenger Satisfaction In the United Kingdom, Emirates was voted Best Long-Haul Airline in The Times and Sunday Times Travel Awards 2025, with over 900,000 travelers commending its attentive cabin crew, luxurious First Class suites, and the spacious comfort offered by its Airbus A380 fleet. The airline continues to broaden its global network, adding five new destinations, including Shenzhen and Siem Reap, thereby enhancing its long-haul connectivity. Emirates also achieved a notable score of 87.86 in the Conde Nast Readers’ Choice Awards for Best Airline, distinguishing itself among competitors from Asia, Europe, and North America. Its regional dominance was further confirmed at the World Travel Awards Middle East Edition, where it was named the Middle East’s Leading Airline Brand for 2025. Challenges and Future Outlook Despite its current leadership, Emirates faces mounting challenges as competitors intensify investments in technology and customer service. Airlines such as Ryanair and SunExpress, spotlighted at the World Aviation Festival 2025, are deploying new technologies and innovative strategies that are reshaping the industry landscape. Additionally, the sector’s increasing focus on decarbonization and resilience amid geopolitical uncertainties is prompting closer scrutiny of Emirates’ operational strategies and cost management. To sustain its competitive advantage, Emirates will need to continue adapting its business model and investing in sustainable innovation. Nevertheless, the airline remains at the forefront of First Class innovation, operating more international First Class seats than any other carrier, with over 26,800 weekly seats worldwide. As the aviation industry evolves, Emirates’ dedication to luxury, inclusivity, and operational excellence continues to set global benchmarks in air travel.

Boeing Model 81 Trainer Undergoes Multiple Engine Replacements Amid Early Aviation Challenges In the late 1920s, Boeing’s Model 81 biplane trainer emerged as a focal point for engine experimentation during a period of rapid innovation in aviation. Constructed using the era’s standard methods—steel tubing frames, wooden spars and ribs, and fabric coverings—the Model 81 was designed to be adaptable, allowing Boeing to test various powerplants in pursuit of improved performance and military contracts. This shift came after the company’s earlier Model 64 failed to meet expectations, prompting Boeing to intensify efforts with the Model 81 in 1928 to maintain its competitive position. Early Engine Trials and Navy Evaluation The initial Model 81 was powered by an unconventional four-cylinder, air-cooled Fairchild-Caminez engine arranged in an X-configuration, delivering 125 horsepower at a notably low 1,000 rpm. Boeing experimented with both two- and four-blade propellers to optimize efficiency. However, the engine’s design introduced significant torque and vibration issues, undermining its reliability. Despite these challenges, Boeing sold a Model 81 equipped with the Fairchild-Caminez engine to the U.S. Navy for $8,300. Designated the XN2B-1, the aircraft was delivered in June 1928. By January 1929, the Navy replaced the problematic engine with a more conventional five-cylinder Wright J-6 (R-540) radial engine, which enhanced performance but did not lead to additional orders. Continued Modifications and Training Use Boeing persisted in refining the Model 81’s powerplant configurations. Another variant, the Model 81A, was fitted with a 145-horsepower Axelson engine and first took flight in December 1928. This version was assigned to the Boeing School of Aeronautics in Oakland, California, where it underwent further modification with a 115-horsepower Axelson engine, resulting in the Model 81B. Subsequently, the 81B was upgraded with a 165-horsepower Wright J-6-5 radial engine, although this change did not warrant a new model designation. The Boeing School of Aeronautics operated one of the two Model 81 trainers from its Oakland base, utilizing the aircraft primarily for pilot instruction. Broader Implications for Boeing’s Innovation Strategy The iterative engine swaps and design adaptations of the Model 81 exemplify Boeing’s early commitment to technical experimentation amid evolving market demands. This pattern of innovation remains relevant today, as the company faces ongoing pressures to develop new narrowbody aircraft and secure partnerships with advanced engine manufacturers. Current challenges, including delays in the 777X program now pushed to 2027, have raised concerns about Boeing’s market confidence and financial outlook. Meanwhile, Airbus’s recent overtaking of Boeing in aircraft deliveries has intensified the competitive landscape, underscoring the urgency for Boeing to accelerate innovation and cultivate strategic collaborations, potentially with engine producers such as Rolls-Royce. The history of the Model 81’s engine replacements thus reflects a longstanding tension within Boeing between advancing technology and meeting commercial expectations—a dynamic that continues to influence the company’s trajectory in the global aviation industry.

How Business Aircraft Technology Is Mitigating Air Turbulence At cruising altitudes around 42,000 feet, where the atmosphere is thinner and generally smoother, business jets often fly above much of the turbulence that affects aircraft operating at lower levels. This high-altitude corridor provides a safer and more comfortable environment for passengers aboard many business jets. In contrast, light jets and turboprops, which typically have maximum operating ceilings of 35,000 feet or below, remain more susceptible to turbulence. This phenomenon can range from causing minor discomfort to presenting significant safety hazards. According to data from the National Center for Atmospheric Research, pilots report approximately 65,000 incidents of clear air turbulence annually. The London School of Economics estimates that the cumulative impact of these events—including compensation claims, increased fuel consumption, rerouting, delays, and maintenance—costs the commercial aviation industry nearly $2.6 billion each year. Innovations in Business Aviation Technology Business aviation has historically been a fertile ground for pioneering technologies aimed at enhancing passenger comfort and operational efficiency. The sector is currently experiencing a steady growth rate of 3.7% in global flights year-over-year, with North America leading this expansion. The preowned jet market is showing signs of stabilization, improving affordability for buyers in the United States and fostering a more optimistic outlook for year-end sales. Operators such as GlobeAir are introducing new aircraft models and adapting their business strategies to address evolving customer demographics, reflecting the industry’s ongoing commitment to innovation. One of the most notable technological advancements comes from Turbulence Solutions, a Vienna-based company founded by András Gálffy. The firm has developed an “active turbulence-canceling technology” that research indicates can reduce the effects of turbulence by more than 80%. This patented system employs retrofittable “flaplets,” small control surfaces attached to the aircraft’s flaps. Inspired by the adaptive wing movements of birds, these flaplets dynamically reshape the wing in real time to counteract turbulence without necessitating major structural modifications. The system relies on sensors mounted on retractable booms or the aircraft’s nose, which provide the necessary lead time to calculate and actuate the flaplets. These surfaces move three to five times per second, functioning similarly to noise-canceling headphones by generating an opposing signal to neutralize turbulence. This technology has been successfully tested on light, fixed-wing aircraft and is currently available on the Shark 600 ultralight model produced by Slovakia-based Shark.Aero. Turbulence Solutions is now focusing on expanding into the broader light aircraft and business aviation markets, with certification efforts underway for larger aircraft. Enhancing Safety and Passenger Experience Through Integration In addition to turbulence-canceling systems, business aircraft are increasingly equipped with a suite of advanced technologies designed to further mitigate turbulence and improve safety. The integration of autoland systems and high-speed connectivity solutions, such as Starlink, on aircraft like the Cessna Longitude exemplifies this trend. These innovations not only enhance operational safety but also ensure that passengers remain connected and comfortable, even under challenging flight conditions. As business aviation continues to evolve, the adoption of cutting-edge aircraft designs and onboard systems is establishing new benchmarks for passenger comfort and operational resilience, enabling the industry to better navigate both literal and figurative turbulence.

AI Unsuitable for Air Traffic Control, Experts Warn Rising Interest Amid Staffing Shortages In the wake of a significant shortage of air traffic controllers that led to widespread flight disruptions in late October, the aviation industry has seen growing interest in artificial intelligence as a potential remedy. Over the past year, proposals advocating for increased AI integration into air traffic control systems have gained momentum, with proponents highlighting automation as a means to enhance operational efficiency and alleviate staffing pressures. However, leading experts in the field caution against the premature adoption of AI for such critical and high-stakes responsibilities. Patrick Arnzen, CEO of the flight training organization Thrust Flight, expressed deep reservations about AI’s ability to replicate the nuanced and instantaneous decision-making essential to air traffic control. He emphasized that the expertise required is cultivated over years of experience, involving not only efficiency but also the paramount concern of safety. “It takes years to develop that instinct to really understand how to do this job—not just efficiently, but also effectively,” Arnzen remarked. “There are a lot of key components to keeping everybody safe up there in the skies.” Safety Concerns and Regulatory Challenges The debate surrounding AI’s role in air traffic management intensified following a tragic collision in January between an Army Black Hawk helicopter and a passenger jet at Washington Ronald Reagan National Airport, which resulted in 67 fatalities. This incident spurred renewed calls to leverage AI technologies, with startups such as NoamAI introducing AI-powered support systems designed to assist control towers. Despite these technological advances, Arnzen warned against overreliance on AI, noting that many control towers still operate with outdated equipment and legacy systems. He also highlighted the aviation sector’s deeply ingrained culture of caution and resistance to rapid change. “In the aviation world, everything that we do is wrapped in heavy regulation,” he explained. “Even if the technology is possible, you can’t deploy it without regulatory approval.” These regulatory barriers underscore broader concerns about the safety and reliability of AI-driven air traffic control systems. Aviation authorities are expected to subject such technologies to rigorous scrutiny, which will likely slow their adoption and raise the standards for demonstrating safety. This cautious regulatory environment is reflected in the market, where investors and stakeholders remain skeptical. Uncertainty about AI’s readiness for critical applications has influenced funding decisions, prompting some companies to shift focus toward less sensitive AI uses or to intensify efforts to refine their technology for air traffic control. Industry Outlook and the Path Forward While the broader AI sector continues to attract substantial investment, analysts warn of potential overvaluation and stress the importance of diversification. High-profile setbacks in sectors like aviation serve as reminders of the current limitations of AI capabilities. For now, industry leaders advocate a measured and balanced approach. Arnzen acknowledged the inevitability of AI’s growing role but urged caution in its deployment. “This technology is coming, it’s something that we want to embrace. But I also think that it’s something that we want to approach carefully and thoughtfully and never really give the full reins to a computer,” he said. “The world is changing, and AI is driving that in a very, very meaningful way—but as far as giving up control to AI to manage the safety of our world, we need to be very careful with that.”

Interview with Jelle Menges of AFI KLM E&M Expanding LEAP Engine Maintenance Capabilities Jelle Menges, head of strategy, innovation, and communication at AFI KLM E&M, recently outlined the company’s accelerated expansion of its LEAP engine maintenance services in response to growing global demand. Speaking at the Aviation Week MRO Europe event in London in October 2025, Menges emphasized the rapid scaling of LEAP engine support as a strategic priority, driven by evolving customer requirements and shifts within the engine maintenance, repair, and overhaul (MRO) sector. Central to this expansion is AFI KLM E&M’s strengthened partnership with AerCap, which Menges described as pivotal in enhancing the company’s LEAP spares and supply chain strategy. This collaboration aims to provide greater flexibility and resilience in servicing airlines worldwide, a critical objective given the forecasted $11 billion cost to airlines from supply chain disruptions in 2025. By reinforcing its logistics capabilities, AFI KLM E&M seeks to mitigate these challenges and ensure uninterrupted support for its customers. Strategic Investments and Innovation AFI KLM E&M has also made significant investments in expanding LEAP engine testing facilities in Paris and Amsterdam. These enhancements are expected to solidify the company’s competitive position within the MRO market, potentially prompting similar moves from competitors, including expansions or new joint ventures. Menges acknowledged the necessity of maintaining leadership in innovation and capacity as the market adapts to these developments. Data-driven innovation remains at the core of AFI KLM E&M’s strategy. Menges detailed the integration of digital tools and predictive maintenance technologies into the LEAP support offering, which enables airlines to improve reliability and operational efficiency. These advancements optimize maintenance schedules and help alleviate the impact of ongoing supply chain constraints, reinforcing the company’s commitment to cutting-edge solutions. Future Outlook and Regulatory Challenges Looking ahead, Menges shared plans for the next phase of the LEAP programme, which includes further expansion of the service network and continued investment in digital capabilities. The company is also navigating a complex regulatory environment, as industry leaders such as the CEOs of Air France-KLM and Lufthansa have recently united to address perceived regulatory imbalances with Gulf carriers. This evolving landscape may influence future market dynamics and competitive strategies. As AFI KLM E&M strengthens its position as a leading global engine MRO provider, its focus on innovation, strategic partnerships, and supply chain resilience will be crucial in meeting the changing needs of airlines and sustaining its competitive advantage.