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Engine AOG (aircraft on ground) groundings

Business Model & Unit Economics · Execution & delivery risk

What it is

Aircraft On Ground events caused by engine removals for inspection or repair. Powdered-metal contamination in Pratt & Whitney geared turbofan engines forced accelerated inspections globally, grounding a substantial share of India's A320neo fleet through 2024-25

Engines must go to a limited number of overhaul shops, so turnaround times stretched to many months

Impact on industries

  • Grounded aircraft carry full lease and financing cost while earning nothing, so the hit is direct and immediate
  • Capacity withdrawal tightened the market and pushed fares up, so the operational failure of one carrier raised prices across the industry
  • Demonstrates the concentration risk inside fleet commonality - a single engine type issue affects the entire fleet at once
  • Compensation from the manufacturer offsets part of the cost, and MRO capacity expansion in India is a direct consequence
  • Indian MRO revenues are expected to triple by FY28 as fleet size doubles, so the constraint is creating a domestic industry

Industries affected