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Take the risk out of aircraft leasing and financial management
By Katrina Dixon
10 April, 2019

The challenges with Maintenance Reserve (MR) and End of Lease (EOL) compensation cash flows.

One of the biggest challenges lessors and airlines face today is managing Maintenance Reserve (MR) and End of Lease (EOL) compensation cash flows. Due to the multi-million-dollar costs involved, failure to accurately predict future cash flows can ultimately have a major impact on the success of a business and value of the leased aircraft(s).

Yet within the aircraft leasing industry there is a lack of confidence in the current prediction models. While current platforms can provide maintenance event costs and intervals for airframe, landing gear and auxiliary power units, they cannot provide the same for the engine, which can be the most expensive part of the plane.

To make accurate predictions on the cost and interval of engine repairs, software solutions need to analyse the four operating conditions: the geographical region of operation, flight hour to flight cycle ratio, 1st run or mature run engine, and Derate if applicable. Yet there are currently no software solutions which do so. Only some operating conditions are considered, meaning asset managers make assumptions on the others.

These limitations can have huge consequences as operating conditions can vary greatly, with different factors potentially having a significant impact on the life expectancy of the engine. If operating condition predictions are even slightly out, cash flow predictions can be way off, leaving lessors and airlines potentially exposed or even out of pocket at the lease end. Consequently, lessors and airlines devise workarounds by running their own spreadsheets or have to hold back funds to cover any unforeseen expenses that could amount to millions of dollars.

Reduce risk and protect the value of your leased asset with FLYdocs

Launching April this year at MRO Americas, FLYdocs has designed and developed an Asset Management Platform to provide unrivalled accuracy in MR and EOL cash flow projections.

The FLYdocs Asset Management Platform considers all the operating conditions and can therefore predict the cost and interval of repairs with a much higher degree of accuracy. This is particularly useful for users of EOL compensation schemes where the costs are settled at the end of the lease.

With its web-based platform, FLYdocs removes the need to put additional capital aside for a financial buffer, meaning lessors and airlines can reduce their financial risk and run their business more effectively.

Make informed decisions on-the-go with the mobile-optimised dashboards

The platform records utilisation, current MR and EOL rates, rate escalation process, manages MR claims and tracks MR funds, while providing information on the cost and interval of maintenance repairs.

These costs will be drawn down from the MR funds which will continually keep adjusting.

Using interactive dashboards optimised for viewing on mobile devices, the platform shows users what their cash flow forecast is going to be each month across their asset portfolio.

A range of complex reports, charts and tables using data from the platform can be produced in just a few taps or clicks of the mouse.

The mobile device optimised platform allows you to quickly see a snapshot of your business, regardless of your location.

For an exclusive first look at the new platform, please visit the FLYdocs stand at MRO Americas on Booth 2425.

What they said

  • FLYdocs has successfully completed lease return projects for Wizz Air in the past, which gave us great insight into the power of their system. Now with full access to FLYdocs®, we have the right platform to manage all of our records across the entire portfolio.
    - Heiko Holm, Technical Director, Wizz Air
  • We can instantly see a project status, identify queries and delegate team members to respond to them all within the system. This detailed visibility provides us with every confidence in our ability to successfully redeliver this large number of aircraft in such a short period of time.
    - Jan De Meyer, Technical Representative & Records Manager, Brussels Airlines
  • We expect the FLYdocs® system to facilitate smoother aircraft lease returns, through benefits such as the structuring of and access to our maintenance records.
    - Rob Saunders, Manager Engineering Development Cathay Pacific Airways
  • We have already enjoyed the benefit of cost and time savings involved with researching historical information – what used to take days to complete, now takes mere seconds to search and find documentation.
    - Jim Landers SVP- Technical Operations Hawaiian Airlines
  • The FLYdocs document audit was very comprehensive and captured a lot of discrepancies that might have otherwise been missed during a physical on-site documentation review. Once in a digital format, it was very quick and easy to locate a required document or piece of information.
    - Dean Pang, Engineering Executive at SilkAir
  • FLYdocs® allows us to be prepared and in a proactive position instead of reacting to document findings from a lessor just before the physical inspection starts. The feedback from the lessors is always positive as they can review the documents online and on different remote locations.
    - Werner Reiser Senior Manager Phase Out Program SWISS International Air Lines Ltd
  • We are excited to be moving to a new digital way of working that will transform our current engineering practices and we ensure that we deliver against our ambitious asset transition programme, keeping us and our fleet at the forefront of aviation in Europe.
    - Cemil Sayar, Director Technic, SunExpress
  • FLYdocs not only brings a leading software solution but also specific expert knowledge in the area of commercial aviation records management.
    - Rob Saunders, Manager Engineering Development Cathay Pacific Airways
  • The visibility and advanced electronic real-time audit functionality across both the records and aircraft physical inspection sides of the process have allowed Virgin staff, our MRO partners and the lessors, lessees and aviation authorities involved in the process to pro-actively manage each delivery with ease.
    - Rick Daniels Information Services & Airworthiness Records Manager Virgin Atlantic Airways
  • The platform’s superior functionality will provide us ease of use and multi-user web access to technical aircraft records from anywhere in the world.
    - Justin Goatcher, CDB Aviation, Head of Asset Management
  • The platform will bring much more versatility and control across the entire audit and transition process. We are also excited by the improvements it will make to our aircraft remarketing and trading performance too.
    - Rich Poutier, Chief Technical Officer, MCAP
  • We were impressed by the technical capabilities of the FLYdocs® platform. We contracted FLYdocs to manage the complete project from scanning to audit, and have the FLYdocs team to thank for their hard work and expertise.
    - Barry Keenaghan, Project Manager, NAC

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