Requirement
The client managed a portfolio of more than 245 aircraft engines, each having approximately 20 Life Limited Parts (LLPs).
The client is an active trader of aircraft engines and it was required to assess the Current Market Value (CMV) of an engine during each possible sale.
It was also required to value the whole portfolio in support of the annual asset impairment exercise.
The data related to the valuation of the aircraft engines was fragmented and it was felt that the current valuation process was laborious, inefficient and inconsistent.
Solution
Life Limited Parts and Valuation Database
We created a database to manage the LLP status of the client’s portfolio of engines. This was a database of serialised parts installed on individual engines, tracking part numbers and Hours and Cycles by engine thrust operation at installation on the engine.
The database also manages data relation to engine valuation, such as LLP value over time and engine carcass value over time.
Engine Valuation Tool
Using the Life Limited Parts and Valuation Database, an Excel based valuation tool was created to automate the valuation of each engine based on LLP status, carcass value, current LLP values and so on. This tool substantially simplified the valuation process for individual engines. Engine valuation was based on the latest monthly utilisation from the company’s current ERP system.
Engine Portfolio Valuation Tool
Using the Life Limited Parts and Valuation Database, an Excel based valuation tool was created to automate the valuation of the whole engine portfolio. The portfolio comprised more than 245 engines and the tool permitted the client to value the whole portfolio based on the latest available data at a fraction of the effort required heretofore.
Engine Valuation Management Tool
Having the Engine Valuation Tool, the client required a system to manage each valuation effort, tagging the individual asset, the valuation date, the potential client, valuation status and so on. We delivered a SharePoint based management system that permitted the users to create engine valuations based on a template and to manage each valuation with the metadata described above.
Outcome
This effort delivered a system to the client that allowed a small team to manage a large portfolio of assets and to reliably value individual assets and the portfolio as a whole.