Is Optimisation even a word that should be used as consignment takes on the mantel of best worst idea in current efforts to get the best out of aircraft, airframe, and engine assets? Assets that should be flying for a few more years are making the journey to that place from which there is no return. Optimisation just appears far too positive a word to be associated with an asset ending that will, for the most part, be sub-optimal. Or is Optimisation the only word that should be used?
How reliable are the factors associated with the traditional consignment approach? What is modelling being based on these days? What clarity are you getting on the constituents of your asset model? How contractually committed are consignment companies to achieving model predictions? What can you rely on, and, perhaps more critically, what can you control?
To be fair, what have consignment companies got to work with? There is little pricing or demand consistency, with the only certainty being that it will be ever-changing for the short to medium term. They are inundated with Lessor inquiries on potential consignment values and timelines, in what has changed from a lessor/asset led market to a consignee/market led asset.
We are all evolving in an environment that has done away with the elements we have relied on in the past. Which brings us back to what can you control. Would it be fair to say that critical control is best applied by those that are in the best position to apply those controls? Let’s talk win-win and how embracing this challenge works. In this sub-optimal market, is Optimisation not the only word that makes sense in getting the best return for your investors?
Over the next three months, in an article every two weeks – SellUe will talk about the elements over which opportunities for critical control exist, mirror partnering, minimal model validation, win-win contracting, and bespoke performance analysis and management. I will also float some non-traditional options that have arisen due to today’s market. If you would like these articles directly to your email box, please let me know.