Major European Airline:

Nyras was asked to review aircraft engine related expenditure, following a significant increase in our client’s Five Year Plan powerplant expenditure. This work was critical because cost increases were raising questions as to the cost effectiveness of planned extensions to all leased aircraft. Nyras identified opportunities for significant cost mitigations by changing engine overhaul policies for both first and second shop visits, with our revised policies being aligned to lease extension proposals and fleet strategy, as well as to a new long term Maintenance Cost Per Hour (MCPH) agreement. The total savings identified, and included in our client’s revised Five Year Plan were in excess of $100m.

Major European Flag Carrier:

Nyras completed a review of this major flag carrier’s maintenance department manpower, covering light and line maintenance, hangar efficiency and Part M organisation. We reviewed the airline’s manpower from a number of angles, reviewing: (i) maintenance plan to establish any efficiencies that would benefit the operation (ii) workload capacity compared to actual manpower availability, (iii) job recording techniques used within the hangar and the ability to produce effective KPIs to maximise productivity, (iv) the most efficient and cost effective use of the existing hangar area, and (v) Part M and Part 21 DOA functions and how they are accomplished. This analysis allowed us to prove practical recommendations to our client on how to optimise manpower and hangar productivity, and Part M cost effectiveness. Direct profit improvement opportunities of some €5m per annum were agreed our client, as well as identifying that the facility had capacity to deal with planned future fleet growth, and improved use of the hangar facility.

Operating airlines of European leisure airline group

During the past five years we have completed a number of very detailed fleet lease reviews for this group of airlines. Our work includes aircraft lease, engineering finance, and engineering experts, reviewing the sufficiency of engineering reserves as compared to the current maintenance status of each aircraft and then ‘fly forward’ to identify the status of each aircraft and engine at the end of the lease, identifying areas where the airline’s maintenance plans and lessor return conditions are not aligned. We also interpret lease contract provisions and advise our client on areas where clarity should be sought from lessor, and review insured values for aircraft. We also provide lease summaries that can be used across departments and across the group. Our analysis has identified deliverable benefits in excess of $20m for our client.

Major European group of airlines

We completed a detailed review of heavy maintenance provision and procurement across five airlines within our client’s Group, with a team including maintenance and engineering finance specialists. Our analysis demonstrated large differences in hangar and manpower efficiency at the Group’s two heavy maintenance bases in UK and Germany. Three core scenarios were established, and modelled with our client, showing clearly the cost of ten-year maintenance plans at our client’s two inhouse bases and a further ‘total outsource’ scenario. Following completion of this initial analysis, a business plan, detailed maintenance cost model and implementation plan was developed, identifying the optimum future set-up. Nyras then supported successful implementation, including detailed support with trade union discussions related to the change. As a cross-Group project, our work required clearance at various levels from Engineering Directors, to Managing Directors to Group Board. The project reduced heavy maintenance cost in the Group by some €8m annually, 40% of the previous costs.

European scheduled airline

Nyras deployed a team of engine management, aircraft leasing and engineering finance experts to work closely with the fleet planning, maintenance and finance teams at our client to understand the existing maintenance programme plus the plan to transition from an Airbus fleet to a new Boeing fleet. We reviewed the existing engine shop visit plans and LLP replacement programme and the related total forecast cost of these maintenance events, projected through to end of lease dates. Following our review we agreed a reduction in the number of engine shop visits required before EOL and a revised LLP replacement programme, which delivered total savings identified in excess of $18M across the fleet. In addition we were also able to identify ways to improve internal processes that deliver further cash flow benefits in the future.

European scheduled airline

Nyras worked for a European airline to review the coverage provided under their powerplant Power by the Hour (PBH) contract and to advise on the negotiating position to avoid material end of contract exposure. Nyras reviewed obligations under the PBH Agreement and the overhaul status of every engine covered by the agreement. The PBH agreement required two performance restorations during the contract term, and as such the contract did not terminate until the second performance restoration had been completed. Due to the excellent on wing performance of the engine type, the life of the engine contract was therefore greater than the length of the aircraft leases. As the airline had already committed to replacement aircraft, the PBH contract caused a material exposure to the airline. Nyras analysed possible outcomes and developed negotiating strategies to be followed by the airline. Nyras assisted the Technical and Asset Management teams to explain their position to the Board and top management as well as to the PBH provider. We developed a detailed legal and technical position to the airline for it to create clear views on acceptable commercial outcomes aligned with end of lease planning. Following our support, the airline reached a compromise with the PBH provider and avoided a potential €200M exposure.

Clayton Dubilier & Rice/SR Technics due diligence:

As industry advisor to CDR, we conducted a due diligence review of SR Technics, applying industry insights, knowledge and contacts, to provide an independent perspective of the operating and commercial environment and the likelihood of success of its integrated MRO service offerings in the context of client requirements and the competitive environment.