Air Finance Journal Financing & Investing in Engines New ... CFM56-5B CFM56-3 V2500-A5 CFM56-5A V2500-A1 ... Œ Workscope to maximize TOW ... Ł 8 main engine modules

The CFM Solution

CFM International Proprietary Information

The information in this document is CFM Proprietary Information and is disclosed in confidence. It is the property of CFM International and its parent companies, General Electric Company and Snecma, and shall not be used, disclosed to others or reproduced without the express written consent of CFM. If consent is given for reproduction in whole or in part, this notice shall appear in any such reproduction in whole or in part. The information contained in this document may also be controlled by the U.S. and French export control laws. Unauthorized export or re-export is prohibited

Air Finance JournalFinancing & Investing in Engines

New York Roadshow


CFM � the world�s largest engine manufacturer� The OEM for CFM56 engines

� 30+ years design & support experience on CFM56 engines

� ~9000 people designing, certifying, manufacturing, and supporting CFM56 engines

� 6 engine models powering 30 commercial and military applications (6650+ total aircraft in 2006)

� Primary power for A320 and B737 single aisle families

CFM is fully committed to its customers


CFM recognizes evolving industry conditions

�Airline economic conditions � cost, competition

�CFM56-3 fleet maturation�Short-term ownership horizon

�Engine life cycle

�Service options exist at differing levels of value and risk�CFM service products deliver financial productivity with proven history of safe and reliable operation

�Non-Type Certificate Holder (TCH) parts are moving from low-tech to high-tech, safety-critical parts

Safety, asset value, and productivity is CFM�s customer commitment


1 9203 440

5 200

7 300

9 500

41%

52%

61%66%

70%

1995 2000 2005 2010 2015

Portion of world-wide fleet 120-250 Pax

CFM powers ~ 60% of the single aisle fleet �Broad experience and demand for CFM56 engines

CFM56 Installed base growing8.3% Compound Annual Growth Rate

Single aisle aircraft in service

CFM

IAE

PW & RR

AC CFM power

% CFM power

Experience

CFM 2006 forecast, with Boeing CFMO and Airbus LRF


Delivering asset productivity �

� CFM56 powered fleet logged 350+ million engine flight hours

� 1 million hours every 10 days

� Departure every 3 seconds

� Increasing departures while reducing engine disruptions

� Industry best reliability

� CFM continually invests in and supports the fleet

-40%-20%

0%20%40%60%80%

100%120%140%160%

CFM Departures

CFM Event Rate

154% increase

32% decrease1995 2006

� by keeping your aircraft flying

Experience

CFM analysis


Aborted Take Offs

1989 1991 1993 1995 1997 1999 2001 2003 2005

55%Reduction

ATO

per

100

0 Ta

ke O

ffs

In Flight Shut Downs

1989 1991 1993 1995 1997 1999 2001 2003 2005

77%Reduction

IFSD

per

100

0 EF

H

Departure Reliability

1989 1991 1993 1995 1997 1999 2001 2003 2005

> 99.97%

Dep

artu

re R

elia

bilit

y (%

)

Cycles to Shop Visit

Tim

e on

Win

g (c

ycle

s)

Reliability � best in class

IFSD rate 0.004 or 1 per AC every 42 years

3 D&Cs in 10K departures Restored (Average of CSV at Removal)0 10

Reliability

ATO rate 0.013 or 1 every 77K flights

10+Kcycles

CFM analysis


CFM56 engine value �� CFM56 engine consistently recognized

for highest value on similar applications

� Liquidity due to large installed base

� CFM56 reliability and cost of ownership

� Valuations based on engines with CFM56 OEM technology and material

� Uniquely maintains configuration management integrity

� No issues with asset liquidity and transferability

8,27,4

6,9 6,55,6

4,3

CFM56-7B CFM56-5B CFM56-3 V2500-A5 CFM56-5A V2500-A1

Source: Airfinance Journal, September, 2006, Number 293

2006 Engine Residual Value Rank

$5.7 $5.7$5.5

CFM56-7B27 CFM56-5B3/P V2533-A5

2006 Engine Current Market Value, $M

Source: Avitas BlueBook of Jet Engine Values 2005-2015

� highest in single aisle aircraft market

Asset Value


Base data source: Engine Yearbook 2007, published by the Aviation Industry GroupReduced asset value based on CFM estimate

Aircraft residual value assured with CFM56 OEM material

Engi

ne P

roje

cted

Val

ue

OEM

Non-OEM

Acquisition Maintenance Disposition

Engine valuation life cycleAircraft/Engine value relationship

Perc

ent o

f Airc

raft

Valu

e

Airframe

Engine

Aircraft/Engine Age

Asset Value

?


Decisions to achieve low maintenance cost

� Operators who choose to focus on time on wing achieve better maintenance cost

� CFM low cost solutions� TOW focus � Longer cycle

� Workscope to maximize TOW

� LLP build optimization

� CFM56-3 upgrade incorporation

� Results in increased asset value

� $/SV focus � Shorter cycle� Repair, used serviceable parts,

and new parts

� Reduced workscope

Maintenance Cost ($/EFH)

$/SV Focus

$/EFH,TOW Focus

$/EFH,With

Upgrade

$175

$150$133-14%

-24%

Based on a CFM engineering study� 150 million EFH� 1000+ engines� 4 of largest CFM56-3 operators

Maintenance


Tech Insertion� Improved fuel burn� Lower maintenance

costs� Lower noise

& emissions

~2013+CFM56 Technology Evolution

CFM56-7B

CFM56-5B/P

Introduction FADEC

Infusing technology into the existing products �

CFM56-3 CFM56-5A

CFM56-5C

CFM56-5B/3CFM56-7B/3

LEAP56

LEAP56� Rotating composites� High stage loadings� Low emissions� Advanced acoustics

1984

Reliably apply advanced, but proven, technology

CFM56-2

3D Aero/Maint Cost� Repair technology� Engine performance� Reliability/durability

upgrades

Technology


� ~3,000 individual parts� 40 sub-systems & sub-

assemblies� 8 main engine modules

All are developed, designed, tested, and substantiated as part of an integrated system �

� not one piece at a time

Engineering


CFM56 customers have service choices� Service options exist at differing

levels of value and risk

� The CFM solution delivers� Proven history of safe and reliable

operation

� Financial productivity � asset value and operating cost

� World class engineering & technology

� Assured ICA and configuration management applicability

� Total commitment to customer & product support


Experience

ReliabilityAsset Value

Technology

Engineering

Support

Maintenance

When you maintain your engines using the CFM solution, you maintain the value of your

CFM56 engine investment


This document is a Bullet Point presentation. It may be misinterpreted without the proper comments from an appropriate CFM representative.


The information in this document is CFM Proprietary Information and is disclosed in confidence. It is the property of CFM International and its parent companies,

General Electric Company and Snecma, and shall not be used, disclosed to others or reproduced without the express written consent of CFM. If consent is given for reproduction in whole or in part, this notice shall appear in any such

reproduction in whole or in part. The information contained in this document may also be controlled by the U.S. and French export control laws. Unauthorized

export or re-export is prohibited

Documents

Air Finance Journal Financing & Investing in Engines New ... CFM56-5B CFM56-3 V2500-A5 CFM56-5A V2500-A1 ... Œ Workscope to maximize TOW ... Ł 8 main engine modules