“I think on shop visits, as you said, we are expecting the shop visits to probably grow at kind of a 25% CAGR from now till 2030, and it's all a function of the installed base that's largely out there and will continue to grow over the next couple of years.”

In context

“Rahul Ghai: David, let me start and then I'll hand it to Larry to talk a little bit about the benefits that we are seeing from the durability upgrade. I think on shop visits, as you said, we are expecting the shop visits to probably grow at kind of a 25% CAGR from now till 2030, and it's all a function of the installed base that's largely out there and will continue to grow over the next couple of years. Most of the engines that we are shipping now are probably not going to come in for a shop visit between now and 2030. It's largely a function of the installed base that exists in the globe today. With that, the big change that we are going to see is that our external channel is going to continue to grow. Our external channel has gone from sub 10% of our overall LEAP services portfolio to call it mid-teens right now, and we expect that to grow to, say, 30% by the time we get to 2030. I think that's the transition you're going to see here. We are seeing the benefit of that. As I said in my prepared remarks, we saw spare parts growth from that channel contributing to our second quarter revenue growth as well. That will continue to build, and all we are doing on our side is continuing to invest, to build more capacity, and then we are adding more channel partners. The other part is that on the cost side, we do expect continuous reduction in our shop visit cost from two main things. One, the fact is that we will be leveraging our fixed cost investments more as volume continues to grow. The second part is that we are working really hard on repairs. Our repair CAGR from this year is more than 20%. We're investing in repairs to bring that shop visit cost down because, as you know, repairs help both with the turnaround time and the cost. Obviously the growth of external channel helps a little bit with mix. That's kind of the trajectory that we're seeing between now and 2030.”