- 22 Feb 2022
- Chris Kjelgaard
- Engines - BizAv
When is it feasible to adjust your engine maintenance program coverage level, and how should you achieve this without unnecessary risk? Chris Kjelgaard asks the industry’s experts…
Engine maintenance program coverage can offer various options, for a variety of monthly payment rates — but not always. The options provided by the coverage available for your engines, usually priced and predicated on a per-flight-hour basis, can depend on the engine type powering your aircraft; the company which made the engines; and the company providing the coverage.
Two of the largest Business Aviation engine manufacturers, GE Aviation and Rolls-Royce, have decided for their respective OnPoint and CorporateCare maintenance plans to offer only comprehensive programs, covering all scheduled maintenance requirements; all airworthiness directive compliance work; line maintenance; and most unscheduled maintenance events — particularly those which require an engine to be removed from the aircraft for repair.
In cases of ingested foreign object debris (FOD) damage to engines (for which the repair costs above a set deductible amount are covered by the aircraft’s hull and liability insurance policy), OnPoint and CorporateCare will also support aircraft owners by leasing them replacement engines and providing engine removal, transport, logistics and installation services.
Indeed, Rolls-Royce subsequently introduced CorporateCare Enhanced in 2018, an even more comprehensive level of maintenance coverage, for its BR710, BR725, and brand-new Pearl 15 BizAv turbofan engines.
Another large Business Aviation engine manufacturer, Pratt & Whitney Canada, has historically offered four levels of coverage in its Eagle Service Plan (ESP), but is evolving towards two levels for a given engine model - a move that it says is driven by declining interest in the less inclusive plans.
By focusing on the two higher level plans, P&WC aims to simplify and streamline the offering and customer experience for its more-than 75 different engine models across the turboprop, turboshaft, and turbofan market segments.
For similar reasons Honeywell, a fourth large manufacturer of BizAv turbine engines and auxiliary power units, also offers three levels of its Maintenance Service Plan (MSP) hourly coverage — MSP, MSP Gold and MSP Gold NRL.
Based in North America two non-OEM maintenance coverage providers, Jet Support Services, Inc (JSSI) and Engine Assurance Program (EAP), also offer plans for various Business Aviation engine types.
EAP specializes in covering several widely-used, slightly older turbofan engine types, providing comprehensive coverage for those. JSSI covers an extensive range of Business Aviation engines, and offers a wide variety of coverage options to suit the needs – and pockets – of its many customers worldwide.
For a variety of reasons aircraft owners may have occasion to consider amending, either by augmenting or cutting back, the levels of coverage their engine hourly maintenance plans provide. But, as you might expect, this is never a decision that you should take lightly, or on the spur of the moment.
The implications of changing coverage levels can severely impact the resale value and the marketability of an aircraft, as well as the ability of the aircraft to perform required missions, according to four experts interviewed for this article.
When is Best to Adjust Coverage?
Sean Lynch, Program Coordinator for EAP, says the best time to consider and shop for the options owners want from their engine coverage is before they buy the aircraft whose engines will be covered.
This generally refers to owners looking to buy used aircraft either offered for sale with no engine coverage, or with a level of coverage that the would-be owner wishes to change. (New-production aircraft usually are sold with comprehensive engine maintenance warranty already in place, but owners usually elect to have them fully covered as well.)
According to Lynch, owners will typically want to change coverage levels — and/or entire plans — for one (or a combination) of three reasons:
1. The level of customer service the plan provider offers;
2. Plan pricing; and/or
3. The level of aircraft dispatch reliability a change in coverage will offer.
During the pre-buy engine coverage decision process, the would-be owner of the aircraft must evaluate a series of important factors in determining the level of coverage they want for the engines; particularly whether the level of any existing plan covering them should be changed.
Overhaul Status: One factor is the status of the engines in terms of time elapsed between overhauls, or until the next mid-point inspection, says Lynch.
If the engines only have, say, 200 flight hours remaining before the next overhaul is due, any newly commissioned plan provider will require the new owner to provide a buy-in to cover the cost of the engine operating time elapsed since the previous overhaul.
Unscheduled Maintenance: Another vital consideration for the new owner is to carefully evaluate the potential costs of unscheduled maintenance events — particularly catastrophic damage — before deciding if the maintenance plan coverage required needs to include coverage for unscheduled maintenance.
Maintenance performed during scheduled shop visits such as mid-point inspections, hot section inspections and overhauls probably only accounts for less than 60% of the total maintenance costs associated with an engine, according to Lynch.
The other 40%, “the real cost, is the stuff that breaks between those events”.
He cites the example of one owner who experienced an engine oil pump failure during the first flight of the aircraft after purchase, requiring a $28,000 repair.
Two trips later, one of the engines had an N1 (low pressure turbine speed sensor) monopole issue that cost $27,000 to repair. Just 30 flight hours after that, an engine’s number 4 carbon seal began leaking and required replacing, at a cost of $180,000 overall.
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