In May, an excavator at a teardown yard outside Phoenix tore open the fuselage of an Airbus A320neo that had rolled off the company’s assembly line in Mobile, Ala., in July 2022, painted yellow for Spirit Airlines, CNBC reported on Saturday. The jet was not yet four years old.
It has company. Richard Hough, the chief executive of the engine lessor Engine Lease Finance Corporation, told the Engine Yearbook that he knew of 100 A320neo-family jets and five Boeing 737 MAX aircraft that had been dismantled or committed for teardown, Aviation Week reported on Oct. 13. Sixty-five of the Airbus jets were powered by Pratt & Whitney’s geared turbofan, known as the GTF, and 35 by the rival CFM LEAP. The data firm IBA, counting only completed teardowns, found 21 newest-generation jets broken up from June 2025 through August of this year, at an average age of 6.4 years. Narrow-body jets have been retired at 21.7 years on average, IBA said.
The economics are simple. A spare GTF can rent for about $200,000 a month, at least as much as a whole jet with its engines, according to Cirium figures cited by Reuters a year ago. An owner facing a repair queue that can run most of a year, or holding an airframe no airline wants yet, earns more by pulling the two engines, leasing them separately and selling the rest of the plane by the piece.
The bill lands in three places. RTX, Pratt’s parent, put the gross cost of its 2023 powder-metal recall at $6 billion to $7 billion, shared with its program partners and much of it owed to airlines as compensation. Two Pratt customers have since gone into bankruptcy: Spirit, which stopped flying on May 2, and airBaltic, which filed in September with Pratt listed as its largest unsecured creditor. And the lessors who own most of the metal are the ones deciding to crush it, a bet that at least one engine lessor thinks will sour.
One airframe, 1,000 parts
The buyer was EirTrade Aviation, a Dublin-based asset manager and parts trader. Early this year it bought two former Spirit A320neos from the lessor Aviation Capital Group: MSN 10769, delivered in December 2021, and MSN 10921, delivered in July 2022, Aerospace Global News reported in February. Each had cost more than $110 million new, the outlet said. The jet CNBC followed went into storage because of Pratt’s engine recall and never left. Bill Thompson leads aircraft and engine acquisition in the Americas for EirTrade.
It’s the first time in my career that involved purchasing an aircraft that’s less than five years since date of manufacture
Mr. Thompson said EirTrade paid “single-digit” millions of dollars for each of the two planes and expected a profit on the more than 1,000 parts its crews removed before the hulls were crushed. The parts went to the company’s hub in Dallas. Nothing is too small to list. “I don’t know if you’re going to sell the coffee makers but you never know. Sometimes you do,” he said.
What survives the stripping is, in the words of Mike Stengel, a partner at the consulting firm AeroDynamic Advisory, “just a metal carcass that you will literally take a crane and crush.” Recyclers, he said, might turn it into “beer cans or something outside of aerospace.”
Why the engine wins
The value sits in the engines. A PW1100G, the GTF model on the A320neo, is worth close to $17 million at the top of the range this year, up 60 percent from the upper end in 2019, IBA told CNBC. Renting one runs about $160,000 to $180,000 a month by IBA’s data, and the CFM LEAP, the other engine choice for the A320neo, rents for $130,000 to $180,000. By August a pair of serviceable GTFs leased for about $400,000 a month on Cirium’s numbers, and prices had not softened, AVM reported.
Single parts carry their own prices. Simon Goodson, chief executive of the trader AerFin, said a fan blade can cost $50,000, or more than $100,000 for bigger jets, and the engines on some A320neos have 20 of them. A disc can cost $1 million to $2 million. Mr. Goodson said he tells his traders, “Please don’t fall in love with the metal.”
Samad Adesokan, an analyst at IBA, wrote in March that part-out companies “are no longer just end-of-life recyclers” and were going after young A320neos for scarce components, and that in many deals “the airframe has effectively become a secondary consideration.”
Airlines waiting on shop slots shuffle what they have. “So you’re just playing Legos and moving engines on and off aircraft,” Mr. Stengel said.
A flaw in the metal
The shortage has a start date. On July 25, 2023, RTX disclosed that a rare condition in powder metal used to make certain engine parts required accelerated inspection of the PW1100G fleet. The contaminated material had gone into high-pressure turbine and compressor parts made from late 2015 to late 2021. Pratt’s first recall covered about 1,200 of the roughly 3,000 engines then in service.
On Sept. 11, 2023, RTX widened it. About 600 to 700 more engines than planned would come off wing for shop visits between 2023 and 2026, the company said in a securities filing, and it would take a pre-tax charge of about $3 billion for Pratt’s 51 percent share of the program. RTX expected an average of 350 GTF-powered jets on the ground through 2026, peaking at 600 to 650 in the first half of 2024, with each engine out for 250 to 300 days, Reuters reported. RTX shares fell nearly 8 percent that day. MTU Aero Engines, the German partner with an 18 percent stake, said it could take a hit of about 1 billion euros.
The timelines slipped. In February 2024, JetBlue’s chief financial officer said the inspections would keep each affected plane out of service for “360 to 365 days,” FlightGlobal reported. By October 2025, 636 GTF-powered Airbus jets, a third of that fleet, were grounded or in storage, according to Cirium. For A320neos with CFM engines the share was 4 percent.
Trouble from the start
The GTF entered service with Lufthansa in January 2016. The new generation of jets promised fuel savings of about 15 percent. Problems came fast. In India, IndiGo and GoAir had in-flight shutdowns, and combustor and bearing wear forced redesigns. In February 2018, European regulators acted over a faulty knife-edge seal in the high-pressure compressor, grounding some A320neos, ch-aviation reported at the time.
GoAir, renamed Go First, did not outlast the engine. It filed for bankruptcy on May 2, 2023, blaming “faulty” Pratt engines, Reuters reported. The airline said its grounded share of the fleet had grown from 7 percent in December 2019 to 50 percent three years later, costing it 108 billion rupees ($1.32 billion). Pratt said it was complying with a March 2023 arbitration ruling and would not comment further. Four of Go First’s A320neos were later stripped for AerFin in Tarbes, France, each yielding about 1,400 parts, Aviation Week reported.
Adam Pilarski, an aviation economist, gave Reuters a one-line diagnosis last year: “They went too fast and the engines had great improvements in efficiency but they failed on maintenance.” Willie Walsh, the head of the International Air Transport Association, said of the young teardowns, “It tells you something is seriously wrong.”
Who has paid
RTX’s own tally is still open. Its latest quarterly filing puts the 2023 charge at $2.9 billion and says Pratt expects groundings of the A320neo fleet to remain elevated through 2026. Free cash flow in the third quarter included about $165 million of powder-metal compensation, Neil Mitchill, the chief financial officer, said on the Oct. 20 earnings call, and he expects the drop in those payments to be “probably about a $500 million tailwind as we head into 2027.” The quarter’s results also carried a $363 million charge at Pratt for a customer bankruptcy. RTX did not name the customer.
Spirit bore the brunt in the United States. Pratt’s affiliate International Aero Engines agreed in March 2024 to pay it $150.6 million for planes grounded from October 2023 through 2024, FlightGlobal reported. A 2025 deal was expected to add $150 million to $195 million, depending on grounded days, and in its second bankruptcy Spirit sought approval of a settlement worth up to $140 million in exchange for releasing claims, Chapter11Cases reported. Spirit’s capacity fell 24 percent in the second quarter of 2025, which it attributed partly to “fewer aircraft being available for scheduling due to GTF engine issues,” according to Aviation Week.
Elsewhere the money has kept fleets flying. Wizz Air, the Hungarian low-cost carrier, had 30 jets grounded for GTF inspections on March 31, down from 42 a year earlier, and 24 by June 5, according to its annual results. It has never said what Pratt pays it. József Váradi, its chief executive, said on an earnings call that a deal tied to more GTF-powered orders meant “we are fully covered until end of 2027.” IndiGo, India’s largest airline, had groundings in the mid-70s in February 2024 and more than 40 when it reported annual results in May, and it has leased in jets with crews to fill the gap.
AirBaltic, the Latvian carrier that flies only Airbus A220s on Pratt’s smaller PW1500G engine, filed for Chapter 11 in New York on Sept. 14. Pratt is its largest unsecured creditor, with a $66.5 million claim, The Baltic Times reported. The airline blamed “industry-wide engine maintenance issues” for a loss of 44.3 million euros in 2025. It was not clear from RTX’s filings whether its unnamed bankrupt customer was airBaltic, Spirit or another airline.
Lessors carry the rest. AerCap, the world’s largest, let Spirit reject 27 of its 37 leases in last year’s restructuring and kept the right to a $572 million unsecured claim, The Irish Times reported. Aircastle took back four A320neos, leased some of their engines out on their remaining green time and expects the airframes back in service around mid-2027, AVM reported.
Spirit’s yellow fleet
Spirit stopped flying on May 2 after talks over a $500 million federal lifeline ended without a deal, NPR reported. It left 114 aircraft, 66 leased and 48 owned, according to Aviation Week, plus 18 spare engines. It had already rejected about 100 A320-family planes, most of them neos, during its second bankruptcy.
Within two weeks most of the fleet was headed for desert storage, Flightradar24, the flight-tracking service, reported.
More than two-thirds of Spirit Airlines former fleet has now been sent to storage. Many of the aircraft still at airports around the country are A321ceos.
31 aircraft stored at GYR
30 aircraft stored at MZJ
Full fleet list and current locations:
On May 8 Spirit rejected its leases with 15 lessors, and in late May the bankruptcy court approved the sale of 20 owned A320-family jets to CSDS Asset Management. By early August, 84 former Spirit aircraft sat at AerSale’s facility in Goodyear, Ariz., held for banks and lessors, and almost all of the A320neos among them had already lost their engines, AVM reported. AerSale expected most to fly again within a year, depending on engine supply.
Some will not. Killick Aerospace, a Dublin-based parts supplier, bought three of Spirit’s owned A320neos in June, including MSN 11152, delivered in November 2022 and the youngest A320neo yet inducted for disassembly. Michael O’Leary, Ryanair’s chief executive, told Aviation Week that lessors had told him they would mostly strip the GTF engines from the roughly 40 neos returned from Spirit and put them into the spare-engine market.
Aviation Week’s maintenance desk flagged the Killick deal as a sign of more ex-Spirit neos moving into the part-out market.
More ex-Spirit Airlines @Airbus #A320neos are entering the part-out market following the purchase of three units by Dublin-based @KillickAeroGrp.
Dave Querio is chief executive of Ascent Aviation Services, which stores and dismantles aircraft in Marana, Ariz. He said he had never seen this volume of young planes torn down, and that for jets delivered in 2023, 2024 and 2025 the question is how long an owner can wait for engines.
A year might not sound that long, but does three or four years?
“It’s a little melancholy to watch it at times,” Mr. Querio said. “But sometimes, it’s kind of a thrill to ... see how fast an aircraft can be crunched up and sent off to the smelter.”
The case for patience
Not everyone in the trade reads the teardowns as a verdict on the plane. Austin Willis, chief executive of Willis Lease Finance, which has bought some of the stripped engines, called it “a paradox where there’s so much demand.” Richard Brown, a consultant at Naveo, told Reuters, “It’s a financial play,” and said, “It shows aviation has become a super-efficient marketplace.”
David Chaimovitz, chief executive of the part-out buyer Setna iO, told AviTrader last year that the early part-outs “are not a sign of weakness.” Airframe parts from the A320neo are about 90 percent interchangeable with those of the older A320ceo, he said, feeding an operating fleet of more than 11,000 A320s. He expects the window to close.
I doubt this trend will last past all current engines having their first shop visits and associated AD’s accomplished.
Tristan Brouard of ACC Aviation called it “a cyclical distortion, not a fundamental redefinition of the A320neo market.” The record mostly supports him. The 100 Airbus jets on Mr. Hough’s list are under 1 percent of the A320 fleet Mr. Chaimovitz described. Pratt’s GTF overhaul output rose more than 35 percent from a year earlier in the third quarter, RTX said, and Wizz and IndiGo both report shrinking grounded fleets.
The weak spot in the patience argument is that it pins the trouble on one engine. About a third of Mr. Hough’s A320neos ran on the LEAP, which wears faster than planned in hot, dusty climates. CFM won certification in December 2024 for a turbine durability kit meant to double time on wing in harsh conditions, and said in July that 40 percent of the LEAP-1A fleet carried it. The other weak spot is permanence. A crushed airframe does not come back when the engine queue clears.
The sharpest warning comes from an engine lessor, one of the businesses profiting from the shortage. Mr. Hough said the part-outs had pushed more than 200 spare engines into the market, easing shortages now and softening demand later, and he questioned whether aircraft lessors’ assumption of better returns would hold up.
The premature part-out of aircraft is going to exacerbate the level and duration of market softness
Roger Welaratne, chief executive of SMBC Aero Engine Lease, warned in February that the scarcity of new-technology spare engines could turn into oversupply within five years, pushing down lease rates and values, Aviation Week reported. If that happens, an owner that crushed an airframe to rent its engines at today’s rates will have traded a plane for an income that shrinks.
What comes next
RTX expects the A320neo groundings to start falling this quarter. “We continue to expect AOG reductions in Q4,” Christopher Calio, the chairman and chief executive, said on Oct. 20, after a third quarter in which the number of grounded planes was “relatively stable.” The company expects about 800 GTF shop visits this year. An upgraded hot section that Pratt says will bring 90 to 95 percent of the newer GTF Advantage’s time-on-wing gain to existing engines is due to enter overhauls early next year.
The teardowns continue meanwhile. TARMAC Aerosave said on Sept. 11 that it would dismantle more than 10 A320neo and 737 MAX jets for AerFin before the end of the year, with more projects planned for 2027. Wizz expects its GTF groundings to reach zero by the end of 2027. AirBaltic expects to leave Chapter 11 by around June 2027.
IndiGo, which still had more than 40 GTF-powered jets on the ground in May, reports quarterly results on Oct. 29.