APW Airplane Maintenance

2023 Boeing Airline Planning
Workshop
Airplane Maintenance
Aleem Wali – Marketing Director
March 2023
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Copyright © 2023 Boeing. All rights reserved. | BOEING PROPRIETARY | APW-Dubai | March 2023
Airline Economics
Revenue Operating Costs
Profits
EQUALS
MINUS
Airline Economics
Revenue Operating Costs
Profits
Today’s key topics
Cost Costs in Cost

Fundamentals Operation Analysis
Operating cost categories
Total operating costs
Airplane related System related Payload related

operating costs operating costs operating costs
Cash Airplane Related

General & Passenger Related
Operating Costs Ownership Costs Cargo Related Costs
Administrative Costs Costs
(CAROC)
• Fuel • Financing • Food • Handling

• Flight Crew • Depreciation • In Flight Services • Commissions
• Cabin Crew • Introductory • Handling • Advertising
Investment • Commissions • Reservation & Sales
• Maintenance
• Operating Lease • Advertising
• Landing Fees
• Hull Insurance • Reservation & Sales
• Navigation Fees
• Airplane Station • Baggage Handling
• Ground Power
FIXED COSTS VARIABLE COSTS
are independent of output change as output changes
Total operating costs


(CAROC)

• Maintenance
• Landing Fees
• Navigation Fees
• Ground Power
FIXED COSTS? VARIABLE COSTS?
are independent of output OR
change as output changes


(CAROC)

• Maintenance
• Landing Fees
• Navigation Fees
• Ground Power


(CAROC)

• Maintenance
• Landing Fees
• Navigation Fees
• Ground Power


(CAROC)

• Maintenance
• Landing Fees
• Navigation Fees
• Ground Power


(CAROC)

• Maintenance
• Landing Fees
• Navigation Fees
• Ground Power


(CAROC)

• Maintenance
• Landing Fees
• Navigation Fees
• Ground Power
CAROC varies by airplane and operation
Fuel Maintenance Landing Nav Ground Flight Cabin
Fees Fees support Crew Crew 11%
14%
10% 4%
17%
3%
2%
10%
9%
3%
4% 737-800W 777-300ER
162 seats
47% 396 seats
10% 1,000 nm 6,000 nm 58%
~ $11,600 per trip ~ $165,000 per trip

Cost Costs in Cost

Airplane
design
impacts
operating
cost
Airplane Station
& Ground Power
OPERATING
Airplane
COST
BREAKDOWN design
Crew Size impacts
Aerodynamics
Systems
operating
Weight
Fuel cost
Materials
Propulsion
Weight-
based Fees
Maintenance
Boeing Airline Planning
Flight length impacts costs – Maintenance example Workshop 2023
Takeoff costs Mission duration costs Landing costs

Structural fatigue • Avionics • Air conditioning
Structural fatigue
EGT margin deterioration • Fuel pumps • Water and waste systems

Tires
• Hydraulic pumps • Engine deterioration Thrust reversers
Engine LLP cycle
• Interior furnishings • Electrical systems Brakes
APU
Which utilization profile will have

higher maintenance cost
Utilization profile #1
Utilization profile #2
Design of airline operation impacts costs
Comparison of Airplane-Related Operating Cost
Airlines based in Europe
9
7
AROC (€cents per km)
SOURCE: Airline annual reports for fiscal years ending in 2017

Design of airline operation impacts costs
Comparison of Airplane-Related Operating Cost
Airlines based in Europe
9
7
AROC (€cents per km)
LCC FULL SERVICE

SOURCE: Airline annual reports for fiscal years ending in 2017
MAINTENANCE
Airframe vs. engine maintenance cost breakout Workshop 2023
737-9 LEAP-1B28 | 1,000 nmi mission

What proportion of Mx is engine
A: 10%
Engine 61% B: 20%
• Repair and overhaul of the engine C: 40%
• Quick Engine Change components D: 60%
• Life limited parts
Airframe
• MPD mandated inspections
39%
• LRU replacement and repair
• Major component overhaul
737-9 LEAP-1B28 | 1,000 nmi mission
Engine Life Limited

• Repair and overhaul of the engine Parts
• Quick Engine Change components Engine Shop

On-airplane: Line and A Check
• Life limited parts • Troubleshooting & corrective actions
required for dispatch
• MPD tasks accomplished during an

Line
overnight
On-airplane: Base
Off-airplane • Scheduled major inspections and
• Expenditures on parts removed and resulting non-routines
repaired off-airplane
• Requires hanger input
• Select components have discrete
intervals and event costs
Airplane age impacts maintenance costs
Non-routine findings increase with age
Airframe Line Brakes and Wheels
A Check Landing Gear
C Check Auxiliary Power Unit
D Check Other Components
Summary airframe aging curve
Airframe Maintenance Cost
Newness Maturity Aging
Higher Utilization
Allocated cost per trip
Lower Utilization
Two dimensional aging curve

• Defined by age (years) and utilization
(flight hours)
Years in service
MPD task escalation extends major check intervals Workshop 2023
Major (C) check intervals escalated Heavy (D) check interval escalated to
from 24 months to 36 months 9 years
737-900ER (2014 MPD) D D D D D D
C C C C C C C C C C C C
737-9
D D D
C C C C C
C C C
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Airplane age
Systems-driven check
Year 10 tasks: integrated with
year 9 check
Full internal structural inspection
1.9 FH Mission and 1,770 FC annually

Advanced materials
reduce maintenance cost
Maintenance benefits of
composites:
Lightweight
No corrosion
Less fatigue
Fewer fasteners
What year of operation does the

787 require its first D-Check?
Getting more from fewer parts
777 777X / 787
14 UNIQUE P/N 7 UNIQUE P/N

23 parts 13 parts
Getting more from fewer parts | 737 MAX Workshop 2023
737NG
Replaced
Relocated
Revised
737 MAX
Boeing leverages continuous, stepwise innovation
1980 1985 1990 1995 2000 2005 2010 2015 2020
Narrowbody Laminar
Performance Flow
Interior Flight Wing 100% Interior Flight Nacelles Comp.

deck design Digital deck Structure
design
737-9 | 1,000 nmi mission
Engine 61%
• Repair and overhaul of the engine
• Quick engine change components
• Life limited parts
Workshop 2023
Engine maintenance
Line Maintenance (On-wing) Shop visit (Off-wing)

Aircraft on ground, engine on wing Activities requiring engine to be disassembled
• Oil servicing • Performance restoration
• Engine component replacement • Life Limited Parts replacement
• Reference: Aircraft Maintenance Manual • Reference: Engine Shop Manual
“Off-wing” represents the vast majority of engine maintenance cost
Performance Restoration Shop Visits Life Limited Parts

Overhaul or parts replacement to restore Exhaust Flight cycle limited parts as defined in Engine Manual
Gas Temperature margin • High pressure turbine disc
• Blades • Low pressure turbine shaft
• Seals • Blisk
• Combustor
The longer an engine
is on wing, the lower
the maintenance costs
EGT margin deterioration Workshop 2023
EGT margin decreases as engine wears
EGT Redline
Deteriorated engine
Margin
EGT New engine

Multi panel combustor burn through
Outside Air Temperature

High pressure turbine blade distress
EGT margin deterioration Workshop 2023
EGT margin decreases as engine wears
Removal for
EGT Redline EGT Redline Shop Visit
Deteriorated engine
EGT New engine EGT
Outside Air Temperature Time on wing

Factors influencing time on wing Workshop 2023
Engine thrust rating

Engine ratings allow operators to balance capability with cost
EGT Redline
CFM56-27E rating
EGT CFM56-24E rating
Outside Air Temperature

Derate
EGT Redline
Less avg.
derate
More avg.
derate
Engine derate
EGT
• Difference between rated thrust & thrust used
• Achievable derate determined at each takeoff

• Runway length
• Temperature
• Obstacles
• Pilot discretion
Time on wing
Environment
EGT Redline
Harsh environment
EGT
Airborne particulates increase wear

• Impacts both time on wing and shop visit cost
• Sand
• Dust
• Pollution
Time on wing
Environment
EGT Redline
Harsh environment
with water wash
EGT Compressor blade before and after a water wash
Water washes restore engine health

• Improved fuel consumption (up to 1.2%)
• EGT margin improvement (up to 15º C)
• Decreased maintenance costs
Time on wing
Flight hour to flight cycle ratio
Takeoff and Climb are Life Limited Parts

most taxing on engine
Climb
Flight Initial LLP
Length Replacement*
350 NM
Cruise
~ 2,700 trips/year 7 years
~ 1 Hour Avg Mission
EGT
Takeoff
800 NM
~1,800 trips/year 10 years
1,250 NM
~1,300 trips/year 14 years
Start/Taxi
Flight time LEAP1B28: core 17,500 cycle LLP life limit
Rate Per Flight Hour programs can simplify maintenance Boeing Airline Planning
& cost planning Workshop 2023
Engine OEM Rate Per Flight Hour (RPFH) offerings also include additional services
Lifecycle time
Additional services
and material
Additional engine OEM services

• Spare engines
Lifecycle time and material
• LRUs
• Burdened time and material engine
Dollars per flight hour

• Logistics
shop visit costs
• On-site support
• Average of study period expenses
• Diagnostics
• Quick turns
• Minimum build requirements
• Transportation
One to One Comparison Boeing Engine Fleet Comparison

Engine OEM
Maintenance Cost (Aircraft Deliveries, Term)
RPFH
Estimate
Workshop 2023
INTRO COSTS &

COMMONALITY
Capital expenditures to support new or incremental fleet introduction
Spares Training Facilities Documents

Airframe Flight crew Tooling MPD
Engine Cabin crew Upgrades Weights
Mechanics Rentals MMEL
Technical Software
What impacts spares and tooling costs? Economies of scale
Fleet attributes
• Fleet size
• Airplane reliability
• Minimum Equipment List (MEL) relief
• Risk tolerance
Spares cost per A/C

0 10 20 30
Fleet Size
What impacts spares and tooling costs? Tolerance for operational impact
Fleet attributes
ESS 3 Parts
• Fleet size
Cost
• Minimum Equipment List (MEL) relief ESS 2 Parts
• Risk tolerance
Maintenance strategy ESS 1 Parts

• In-house vs. outsourced maintenance
• Engine/Component programs “Pooling” Total airframe spares estimate
• Spares turn time
• Tolerance for operational impact ESS3 Parts: Flight can be dispatched
• Minimum RSPL
ESS2 Parts: Flight can sometimes be
dispatched – conditions dictated by MEL
ESS1 Parts: Cannot be dispatched for

commercial service with part inoperative
What impacts spares and tooling costs? Network considerations
Multi-hub
Fleet attributes
• Fleet size
• Minimum Equipment List (MEL) relief
• Risk tolerance
Maintenance strategy
• In-house vs. outsourced maintenance
• Engine/Component programs
• Spares turn time Mega-hub
• Tolerance for operational impact
• Minimum RSPL
Network considerations
• Utilization
• Proximity to spares pool(s)
• Operational environment
Commonality can reduce provisioning costs
Airplane with no
commonality S
A
V
Airplane with partial I
Initial provisioning, $
commonality N
G
S
Existing airplane Airplane with total

commonality
fleet
Fleet size
Summary: predicting costs
Design matters We control our costs

Airplane design and airline operation Airlines and manufacturers have
drive operating costs opportunities to improve costs
S t r e t c h
Cost Costs in Cost

Airline departments may analyze costs differently
Actual annual maintenance costs vary dramatically based on event timing
Airframe maintenance costs Cash Flow
Line
A Check Potential users
C Check • Finance
D Check
• Maintenance
Brakes
Wheels, Tires
Planning
Landing Gear
APU
Other Components
Annual cost
Aircraft age
Allocation spreads maintenance costs across the years covered by a specific event
D Check cost allocation example
Allocated
Annual cost
Aircraft age
Allocation spreads maintenance costs across the years covered by a specific event
D Check cost allocation example
Allocated
Costs are allocated for events that occur
Annual cost
beyond the study period
Study period
Aircraft age
Allocated costs gradually increase as airplane ages
Airframe maintenance costs
Line
A Check
C Check
D Check
Brakes
Wheels, Tires
Landing Gear
APU Allocated
Other Components
Annual cost
Potential users
• Accounting
• Lessor
Aircraft age
Lifecycle cost provides a single summary value
Line
A Check
C Check
D Check
Brakes
Wheels, Tires Average Lifecycle cost
Landing Gear
• $ per Year
APU
• $ per Flight Hour
Other Components
Annual cost
• $ per Trip
Study period
Lifecycle
Potential users
• Network Planner
• Airplane
Aircraft age Evaluator
Maintenance Economics: Allocate the 12-year D-Checks

D Check
D Check Events
What is the allocated cost of the first D-
Check?
Allocated
Annual cost
$1.22M 1.32M
$102K
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Aircraft age

D Check
D Check Events
What is the allocated cost of the SECOND
D-Check?
Allocated
Annual cost
$1.22M 1.32M
$102K $111K
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Aircraft age

D Check
D Check Events
What is the Average Lifecycle Cost over 12-
years?
Average Lifecycle cost

• $102K per Year Allocated
Annual cost
Study period $1.22M 1.32M
$102K $111K
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Aircraft age

D Check
D Check Events
years?

Annual cost
$102K $111K
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Aircraft age

D Check
D Check Events
years?

Annual cost
$102K $111K
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Aircraft age
LIFE CYCLE AVERAGE
COST PER TRIP
LIFE CYCLE AVERAGE
COST PER SEAT
COST PER AVAILABLE

SEAT KILOMETER
PER FLIGHT HOUR
PER AIRCRAFT
PER SUBFLEET CASH FLOW
WAYS TO ANALYZE OPEARATING COSTS
How Boeing analyzes operating cost
MARKET
D ATA
SOURCES
BOEING BOEING AIRLINE

INTERNAL COST GROUND
D ATA MODEL RULES
Single airplane Full fleet

Cash flow Cash flow
Life cycle average Life cycle average
Summary: cost analysis
Perspective matters Fleet renewal

Choose metrics that provide insight Evaluation of both operational and
for your application introductory costs should drive fleet
decisions

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2023 Boeing Airline Planning

Revenue Operating Costs

Revenue Operating Costs

Cost Costs in Cost

Total operating costs

Airplane related System related Payload related

Cash Airplane Related

• Fuel • Financing • Food • Handling

Total operating costs

Airplane related System related Payload related

Cash Airplane Related

• Fuel • Financing • Food • Handling

Airplane related System related Payload related

Cash Airplane Related

• Fuel • Financing • Food • Handling

Airplane related System related Payload related

Cash Airplane Related

• Fuel • Financing • Food • Handling

Airplane related System related Payload related

Cash Airplane Related

• Fuel • Financing • Food • Handling

Airplane related System related Payload related

Cash Airplane Related

• Fuel • Financing • Food • Handling

Airplane related System related Payload related

Cash Airplane Related

• Fuel • Financing • Food • Handling

~ $11,600 per trip ~ $165,000 per trip

Cost Costs in Cost

Flight length impacts costs – Maintenance example Workshop 2023

Takeoff costs Mission duration costs Landing costs

EGT margin deterioration • Fuel pumps • Water and waste systems

Which utilization profile will have

SOURCE: Airline annual reports for fiscal years ending in 2017

LCC FULL SERVICE

Airframe vs. engine maintenance cost breakout Workshop 2023

737-9 LEAP-1B28 | 1,000 nmi mission

• Major component overhaul

Airframe vs. engine maintenance cost breakout Workshop 2023

737-9 LEAP-1B28 | 1,000 nmi mission

Engine Life Limited

• Quick Engine Change components Engine Shop

• MPD tasks accomplished during an

Airframe Line Brakes and Wheels

A Check Landing Gear

C Check Auxiliary Power Unit

D Check Other Components

Newness Maturity Aging

Two dimensional aging curve

MPD task escalation extends major check intervals Workshop 2023

737-900ER (2014 MPD) D D D D D D

1.9 FH Mission and 1,770 FC annually

What year of operation does the

777 777X / 787

14 UNIQUE P/N 7 UNIQUE P/N

Getting more from fewer parts | 737 MAX Workshop 2023

Interior Flight Wing 100% Interior Flight Nacelles Comp.

Airframe vs. engine maintenance cost breakout Workshop 2023

737-9 | 1,000 nmi mission

• Quick engine change components

• Life limited parts

Line Maintenance (On-wing) Shop visit (Off-wing)

Performance Restoration Shop Visits Life Limited Parts

is on wing, the lower