Ryanair expects to sign a "multibillion" spare-parts deal with engine manufacturer CFM International within the next few weeks, the airline group's chief executive has indicated. Briefing investors on quarterly results, Michael O'Leary said the deal would help Ryanair "meaningfully beat" the significant industry-wide inflation in engine-maintenance costs he foresees over the next few years, driven by the price of spares and a lack of shop capacity. "We have found it a little bit more difficult than normal dealing with CFM and GE on the engine shops, but we are very close to signing up a multi-year spare parts agreement with CFM," says O'Leary. “I expect to be able to announce something there… by the end of our fiscal year [to end-March]." Ryanair is establishing two of its own in-house engine shops to meet maintenance requirements, with a view to keepings costs down. The airline had two to three years ago been quoted rates for 2028/29 engine overhauls that were three times the prevailing level, climbing to five times higher for Max jets. Since then, "I don't think those numbers have softened", O'Leary comments. He estimates that around 85% of the cost of maintaining engines goes on parts. Ryanair’s scale and ability to bring maintenance in-house should enable it to sidestep this, he believes, but smaller airlines and leasing companies "are going to get fried alive" by engine manufacturers given the lack of slack in the system, he warns. "We have huge spare parts inventory already, but by buying more judiciously and buying spares… we will be able to meaningfully beat that kind of cost inflation going forward," adds O'Leary. Ryanair has earmarked a reserve pool of around 120 CFM engines to reduce the risk of aircraft groundings. Fleets data lists the group as having 411 CFM56-powered 737NGs and 206 Leap-1A-powered Max 8s in service. It has another four Max 8s and 150 Max 10s on order.

Allegiant Air has issued a request for proposals (RFP) for the debt financing of 11 Boeing 737 Max 8s delivering in 2026. The 16 January RFP asks for proposals to be submitted by 17 February, and Allegiant plans to award mandates and move to the term sheet stage in March. The second quarter of 2026 is earmarked for finalizing and executing documentation. The airline does not expect to invite second round bids for this RFP. One of the 737 Max 8s is scheduled to deliver in 2026's first quarter, three in its second quarter, one in its third quarter and six in its fourth quarter.

A combination of rebounding demand and constrained fleet growth will support the airline industry's profitability this year, lessor Avolon predicts in its latest annual outlook. This will be aided by lower fuel costs, with falling kerosene prices having driven financial performance in 2025. Fuel expenses fell by $8 billion in 2025 compared with the previous year, accounting for a large chunk of carriers' profitability. Airlines continue to grapple with rising non‑fuel costs such as labour and maintenance inflation, but capacity constraints stemming from aircraft delivery delays and engine‑related groundings have kept supply tight, pushing yields higher, notes Avolon. It cites IATA's expectations that airline profitability will hit $41 billion in 2026, marking its fourth consecutive year in positive territory. This puts airlines on track to recoup more than 80% of the $182 billion in losses they accumulated during the pandemic years. The leasing giant highlights the ongoing divergence in performance between airline business models. Strong premium and long‑haul demand is bolstering major US network carriers, while European low‑cost carriers continue to expand their dominance of intra‑regional capacity. Meanwhile, Middle Eastern carriers are delivering record profits, but Asian markets face uneven recoveries given sharp demographic declines in some countries. Avolon foresees that reduced fleet growth, low fuel prices and robust travel demand will continue to support further credit upgrades for airlines, many of which have already shown balance‑sheet improvement. "Leverage is reducing as global airlines' net debt has dropped by more than $100 billion since its peak in 2020," notes the lessor. However, operational challenges, particularly a persistent wave of aircraft groundings caused by engine issues, remain a drag on efficiency. These disruptions are set to continue into late this decade, but the number of grounded aircraft should begin to decline in 2026 as engine manufacturers ramp up shop‑visit capacity and introduce upgrades. Avolon observes also that the market value of two full-life engines now represents around 80% of a new aircraft, and that by the time it reaches six years of age "two full-life engines are worth more off-wing than on-wing". The effect of high engine costs, significant aircraft groundings and a shortage of spare engines is a trend towards the part-out of young aircraft. "This dynamic will only act to prolong the undersupply of new aircraft," adds Avolon. Despite lingering headwinds, the report concludes that the industry's structural resilience, solid travel demand and favourable fuel backdrop position airlines for another profitable year, even with global growth moderating as the recovery from the pandemic fades.