Posted on by Mark Evans

Projection Module: The Retirement Model

Why are there so many retirements during the current period?

When using the Projections tab within Fleets Analyzer, and showing Retirement events, you may notice a large number of events during the current period (month, quarter, year), along with a corresponding drop in the number of in-service aircraft.

When there is no known retirement date for an aircraft, under the Projections tab, a basic retirements model is used. The model uses the following rules:

Table 1: Retirement rules.

For example, if a narrowbody passenger aircraft is >25yrs, has flown >60,000 hours, or performed >48,000 cycles at today’s date, then the model will retire the aircraft the following day (the aircraft only has to exceed one of the rules to be retired). For this reason, an operator with an old fleet (or a fleet that has flown a lot of hours or cycles) will see a large proportion of its fleet retire during the current period.

An example: Southwest Airlines’ 737-700s

Many of Southwest’s 737-700s in service today already exceed the hours rule as defined for narrowbody jets. Figure 2 shows a plot of the age vs hours for this fleet. The areas in blue are those areas where the rules for either age or hours have been exceeded (for clarity, the rule for cycles is not included). As you can see, a large proportion of the fleet has already exceeded 60,000 hours (see Table 1). For this reason, the model will retire these aircraft during the current period.

Figure 1: Hours flown vs age. Anything in the blue area will be retired (for clarity, the cycles rule is not included).

When using the Trend tab within Fleets Analyzer, and viewing the number of in-service aircraft and retirement events for Southwest’s 737-700s for the period 2015-2025, the data will appear as shown in Figure 2. There are only two known retirement events: one in 2019, the other in 2020. For this reason, the number of in-service aircraft remains relatively flat following the end of the current period: i.e. 2020.

Figure 2: In-service and retirement events – as seen within the Trend tab.

When using the Projection tab, and viewing the same search over the same period, the results will appear as shown in Figure 3. There are now more than 100 retirement events during the current period (2020). For this reason, the number of in-service aircraft also drops dramatically. In addition to the large number of retirements during the current period, there are also retirements during the subsequent periods. This is due to the fact that, within the Projection tab, in addition to an aircraft getting older and exceeding the age rule, the hours and cycles are also projected forward (based on historic trends), so these rules can also be exceeded.

Figure 3: In-service and retirement events – as seen within the Projection tab

What other effects are there?

Any metric that is reliant on the number of in-service aircraft will be affected by this retirement model. For example, projections of maintenance checks will use the number of in-service aircraft that remain after they have been checked by the retirement model.