Aftermarket parts specialist Setna iO is exploring the possibility of venturing into buying and leasing aircraft as it looks to gain earlier control over its supply chain while growing the number of assets in its components pool.
To date, the Chicago-headquartered company has made tentative moves into the leasing of engines and components. It currently has one General Electric CF6 engine out on lease and around half a dozen landing gears and some auxiliary power units also leased out, according to Setna iO CEO and president David Chaimovitz.
Chaimovitz told Aviation Week at MRO Americas earlier this month that the company has the funding structure to buy aircraft assets on its own, and it is looking at further expansion in this market segment and eventually growing it into a “significant” part of its business. “We have the ability to manage them on lease, part-out assets ourselves and repair parts in-house,” he says.
Ultimately, Chaimovitz sees the value in venturing into aircraft leasing as a way to give Setna iO control of assets "much earlier, which will allow us to bring them through our supply chain and maximize the value on the component part-out and MRO side.” He foresees the company taking an agnostic approach to platforms that will be dependent on its current needs.
Chaimovitz, who founded Setna iO in 2016, says the parts market is generally healthy in terms of demand. “It is robust across the board in everywhere from Boeing 737 Classics up to [Airbus A320]neo aircraft and widebodies like A350 aircraft,” he says. He adds that price fluctuations have occurred in the market since the pandemic, first declining steeply in mid-2021 before ascending for around 24-30 months.
More recently, he says parts prices have leveled off, albeit with some increases for specific parts areas such as fan blades for CFM International CFM56-7B engines in contrast to their -5B counterparts, which are dropping in price. “This is healthy and normal, and it’s showing that the market has very strong demand and relatively stable prices,” he says.
Setna iO mostly deals in used serviceable material parts, accounting for about 90% of its overall business. The remainder is comprised of OEM-sourced parts.
