On March 13th, Bank of China Aviation made an announcement that it had selected IAE V2500 engines for an order for 12 A320s. We decided to look into this engine selection and evaluated this growing lessors A320 family engine selection over the years. The company has 124 A320-Family aircraft in its fleet.
As the next chart illustrates, BOC has been a loyal P&W customer for some time now. BOC has been a steady purchaser of the A320 family over the years. With each passing year the company has become ever more loyal to P&W and its IAE engines. The pie chart illustrates the A320 family breakdown at BOC.
This is in stark contrast to the rest of the aviation industry and its engine selection over the years as the following charts for other major lessors demonstrates.
Across the market, among the A319s CFM has an average 67% market share. On the A320, CFM has an average 57% market share.
Next let’s take a look at some of the big lessors and see how their A320 family fleets look.
AerCap is an industry giant, with $44bn in assets and 1,300 aircraft. They have 117 A320 family aircraft in their fleet. If one adds those in the fleet and on order, the number grows to 691 and the firm manages 59 for other investors. The chart suggests that AerCap is CFM oriented with 65% of its selection going to CFM.
The following chart lists the current operational A320 family fleet worldwide, by model and breakdown. The larger the family model becomes, the greater is the amount of share held by IAE. Overall for the entire family, CFM holds a 56.3% market share.
As we have seen among the leading aircraft lessors, BOC is not being radical by selecting IAE engines for its A320 family aircraft. Apart from GECAS, many of the leading lessors have relatively equally weighted portfolios, or lean slightly towards IAE.
Any idea why lessors prefer IAE, while overall orders lean to CFM? What is the breakdown for anounced neo orders?
We think a lot has to be driven by powerful GE financing.