Investment thesis · Live
New jet engines are still causing problems, driving a historic boom in the aftermarket for parts and MRO services
Reliability issues with new-generation engines and delays in jet deliveries are forcing airlines to extend the life of older aircraft. That is turning the market for parts, MRO work and leasing into a genuine cash machine.
Published July 6, 2026 · 120-day horizon · supply and demand
Basket return
-22.5%
equal weight, since publication
The market over the same window
+1.8%
benchmark for this basket
Edge over the market
-24.3%
in percentage points
Causal chain: Shortfalls in new aircraft deliveries to the market → High failure rates on new-generation jet engines (GTF, LEAP) → Airlines keep old aircraft in service far longer → Demand surge and sharp price increases in the aftermarket → Huge parts margins for the major engine makers → Step change in work orders for independent MRO → The market for leasing, PMA parts and USM components
What this thesis rests on
Each one is a statement that has to be true. When a filing says otherwise, the thesis is in trouble, and this is where we say so.
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Boeing and Airbus do not announce a restored narrowbody delivery schedule: Boeing 737 output stays at or below 42 jets per month with no FAA approval of a higher rate before 3 November 2026.
regulatory · Unverified
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RTX discloses an average of more than 300 GTF-powered A320neo-family aircraft on ground in each quarterly report filed during the 120-day horizon, with no powder-metal inspection completion declared.
operational · Unverified
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Willis Lease Finance reports lease rent revenue up at least 15% year over year in the two quarterly filings after publication, showing spare-engine lease rates have not broken.
financial · Unverified
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Safran reports civil aftermarket revenue growth of at least 10% year over year in its H1 2026 results, carried by CFM56 spare parts and shop visits rather than new LEAP deliveries.
financial · Unverified
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Heico keeps its FAA PMA approvals with no suspension or adverse airworthiness action disclosed, and reports Flight Support Group net sales growth of at least 10% year over year in the quarter after publication.
regulatory · Unverified
The setup: two market anomalies hitting at once
Commercial aviation is currently dealing with two powerful supply shocks. First, Boeing and Airbus are permanently unable to deliver enough new narrowbodies to the market. MAX output is being choked by tightened regulatory scrutiny, while A320neo supply is held back by bottlenecks at subcontractors. Second, the newest powerplants have turned out to be highly temperamental. Faulty powder metallurgy forced Pratt & Whitney into a global inspection campaign on GTF engines, grounding hundreds of Airbus jets in the process. At the same time, LEAP engines (from the CFM joint venture) are holding up badly in harsh, hot-and-high operating conditions. The need for frequent shop visits radically shortens their time on wing. The result: the industry has nowhere to source new aircraft, and on top of that it cannot fully trust the ones it already owns.
Open the interactive thesis
Interactive causal map, the basket charted against its market, and the full timeline.
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This is analysis, not investment advice and not a recommendation to buy or sell anything. We publish it and track it in public, mistakes included. Any decision is yours and yours alone.