Delta Air Lines executives flag the role that its MRO business has played in ensuring the reliability of older aircraft in its own fleet, but note the focus will start to switch toward managing aircraft retirements and developing third party business.
The SkyTeam carrier has its own in-house maintenance unit, Delta TechOps, and speaking on an first quarter earnings call on 10 April, chief financial officer Dan Janki says the division gives the carrier a key advantage.
“Given the constraints of the industry with the OEMs, [we’ve] leaned in to restore the network and to work flexibly,” he says. ”So flying 87 [Boeing] 717s, flying the 757s longer than we had anticipated, that puts demand on our TechOps team. Their ability to ensure that we have those aircraft, that they are reliable, really allows us to flex and be more nimble.”
Chief executive Ed Bastian adds: ”In the first quarter our overall mainline reliability and completion factor was the strongest first quarter in our history and that’s quite a statement given what we have been through in the supply chain [and the] constraints that still exist. That is going to continue to be a positive.”
While supply chain constraints have led to some aircraft being kept in service for longer than envisaged, Janki says that a return to normalised growth rates and more supply chain consistency will allow the carrier to return to a period of more natural aircraft retirements.
”We haven’t retired any aircraft in 2022 and 2023,” he notes. ”We will start that in the back half of this year and that’s really where our team always shines. The ability to naturally retire [aircraft] but then recoup that equipment and reuse that used material and run out the fleets. They did it with the MD-88-90s. They have that history. And that’s really what we have in front of us.”
Bastian also sees focus returning in the longer-term to growing its third-party MRO activity. “While we have taken a pause – given we have had to focus our energies on our own fleet as compared to our customers’ fleets – going forward in the next couple of years, that’s going to start turning back on again.
”That growth rate is still there, it’s just waiting,” he says. ”I think our ability to capture that business is going to be even stronger than we were thinking pre-pandemic, given what we’ve all been through.”
