Best Industry Practices For Aircraft Decommissioning (BIPAD)

Best Industry Practices for AircraftDecommissioning (BIPAD)1st Edition

AircraftDecommissioningWorkshopOptimize the realization of residual value from aircraft decommissioningAbout 700 aircraft are being retired each year, with a growing trend. If undertaken in a timely and appropriatemanner, decommissioning can allow recovery of a good residual value from re-used parts and recycled material, whilst minimizing environmental and safety risks. Timely retirement is an essential part of the fleet renewalprocess. However, for most airlines and other aircraft owners, such as lessors, limited experience is availableon managing aircraft decommissioning as a controlled process.In this 2-day workshop you will receive guidance on business processes, operational experiences and bestpractices in the industry, reinforced with exercises, discussions, and role play to equip you with the knowledgeto optimize the residual value from aircraft decommissioning.www.iata.org/trainingin IATA Trainingf @Training.IATA

NOTICEDISCLAIMER. The information contained in thispublication is subject to constant review in the lightof changing government requirements and regulations. No subscriber or other reader should act onthe basis of any such information without referringto applicable laws and regulations and/or withouttaking appropriate professional advice. Althoughevery effort has been made to ensure accuracy, theInternational Air Transport Association shall not beheld responsible for any loss or damage caused byerrors, omissions, misprints or misinterpretation ofthe contents hereof. Furthermore, the InternationalAir Transport Association expressly disclaims anyand all liability to any person or entity, whether apurchaser of this publication or not, in respect ofanything done or omitted, and the consequencesof anything done or omitted, by any such person orentity in reliance on the contents of this publication.Opinions expressed in advertisements appearing inthis publication are the advertiser’s opinions and donot necessarily reflect those of IATA. The mentionof specific companies or products in advertisementdoes not imply that they are endorsed or recommended by IATA in preference to others of a similar nature which are not mentioned or advertised. International Air Transport Association. AllRights Reserved. No part of this publication maybe reproduced, recast, reformatted or transmitted in any form by any means, electronic ormechanical, including photocopying, recording or any information storage and retrieval system, without the prior written permission from:Senior Vice PresidentMember & External Relationsand Corporate SecretaryInternational Air Transport Association33, Route de l’Aéroport1215 Geneva 15 AirportSwitzerlandBest Industry Practices for Aircraft Decommissioning (BIPAD) 1st EditionISBN 978-92-9229-827-2 2018 International Air Transport Association. All rights reserved.Montreal—Geneva

Best Industry Practices for Aircraft Decommissioning (BIPAD)ForewordThe research, development and production of new aircraft is very much in the publiceye, but much less is known about what happens to an aircraft at the end of itsoperational life. However, an entirely new industry has grown up around this processand has achieved impressive performance in recent years. Today, around 700aircraft are decommissioned every year, a number that is only set to increase. Up toapproximately 90% of the parts of a decommissioned aircraft can be either re-usedas spare parts for other aircraft or recycled if best practices are applied.However, many aircraft owners and operators have limited information on thebest practices around the aircraft decommissioning process which would ensurethat the residual value of parts and material are maximized while respecting theenvironmental impact.IATA, in its mission to represent, lead and serve the airline industry, has recognized the need to address thisissue. This Best Industry Practices for Aircraft Decommissioning (BIPAD) manual has been developed to helpairlines and other aircraft owners in their decision to decommission an aircraft, in the criteria to look at for theselection of an appropriate facility and in the steps of disassembly, dismantling and re-use of parts. For eachstep, information is provided on the operational and economic, regulatory and legal, safety and environmentalaspects.For the development of this manual, IATA has been working closely with a multi-stakeholder industry groupconsisting of experts from airlines, their maintenance branches and other maintenance, repair and overhaulcompanies, aircraft and engine manufacturers, lessors, disassembly, dismantling and recycling companies andtheir global association, AFRA, and parts traders.I hope this manual will help its readers, across all interested stakeholder groups, to gain new insight into theaircraft end-of-life process and to contribute to making aviation more sustainable by properly taking care ofaircraft which have reached the end of their operational life.Michael GillDirector, Aviation EnvironmentInternational Air Transport AssociationIV1ST EDITION – NOVEMBER 2018

IntroductionTable of ContentsForeword.IVTable of Contents.VDefinitions.IXAbbreviations .XFigures & Tables.XIIIExecutive Summary.1Chapter 1—Background and 41.3  Introduction to the Aircraft Decommissioning Process.51.4  Overview of the Sector.6Chapter 2—Decision to Decommission.102.1  Economic and Operational Aspects. 112.1.1  Fleet Planning. 112.1.2  Operational life.122.1.3  Maintenance Cycle.122.1.4  Technological Improvements.142.1.5  Economic Conditions.162.1.6  Accounting Principles.182.1.7  Aircraft Value Concepts.192.2  Regulatory and Legal Aspects.212.2.1  Civil Aviation Regulatory Requirements.212.3  Safety Aspects.232.3.1  Declarations for Continued Use of Parts.232.4  Environmental Aspects.242.4.1  General Overview.242.4.2  Circular economy.25Chapter 3—Selection of Facilities .273.1  Economics/Operational Aspects.271ST EDITION – NOVEMBER 2018V

Best Industry Practices for Aircraft Decommissioning (BIPAD)Table of Contents3.1.1   Facility Location and Climate.273.1.2   Storage and Maintenance Capabilities.283.1.3  Accreditations .293.1.4   Marketability of Components.303.1.5   Local Operational Costs.313.1.6   Aircraft Decommissioning with Mobile Unit.313.2  Regulatory and Legal Aspects.343.2.1   Protection of Ownership Rights.343.2.2   Tax Regulations.353.3  Safety Aspects.373.3.1   Commitment to Safety & Quality .373.3.2   Health and Safety in Employment Regulatory Requirements.383.3.3  Quality systems.383.3.4   AFRA Accreditation.393.3.5   Personnel Requirements and Training.403.4  Environmental Aspects.423.4.1  Environmental Compliance .423.4.2   AFRA and Environmental Management Systems.433.4.3  Environmental Protection.453.4.4   Aircraft Decontamination, Hazardous Materials and Hazardous Waste Materials.473.4.5   Sustainability Factors and Challenges.47Chapter 4—Disassembly Process.494.1  Economic and Operational Aspects.494.1.1   Realise the Residual Value.494.1.2   Reuse of Critical Assets (Halon).514.2  Regulatory and Legal Aspects .524.2.1   Protection of Ownership Rights of Parts.524.3  Safety Aspects.53VI1ST EDITION – NOVEMBER 2018

IntroductionTable of Contents4.3.1   Safety Conditions for Workers and External Persons.534.3.2   Product Safety and Airworthiness.534.3.3  Quality Management.534.4  Environmental Aspects.564.4.1   Material Management during Disassembly .56Chapter 5—Dismantling Process.605.1  Economics and Operational Aspects.605.1.1   Realise the Residual Value.605.1.2   Unconventional Usage of Components for Non-aviation Purposes.605.2   Regulatory and Legal Aspects.625.2.1   Protection of Ownership Rights .625.2.2  Liability.625.3  Safety Aspects.625.3.1   Safety Condition for Workers and External Persons.625.3.2   Product Safety and Airworthiness.625.3.3  Quality Management.635.4  Environmental Aspects.645.4.1   Material Management during Dismantling.64Chapter 6—Parts Re-certification and Distribution.676.1  Economics and Operational Aspects.676.1.1   Supply and Demand.676.1.2  High-value Components.686.1.3   Fast and Slow Movers.726.1.4   Original Equipment Manufacturer Policies.736.2  Regulatory and Legal Aspects.756.2.1   Airworthiness Certification.756.2.2   FAA Export Airworthiness Approval Process.756.2.3   EASA Export Certificate of Airworthiness.761ST EDITION – NOVEMBER 2018VII

Best Industry Practices for Aircraft Decommissioning (BIPAD)Table of Contents6.2.4   Reuse of Standard Parts.766.3  Safety Aspects.776.3.1   Uncertified Components/Bogus Parts.776.4  Environmental Aspects.80Appendix.iAppendix A – IATA Incident/Accident Clearance Statement 76. iAppendix B – Examples of dangerous and hazardous materials to be removed and treated from aircraft. iiiAppendix C – Framework for managing hazardous waste materials. vAppendix D – ICAO Member States that may have aircraft age restrictions for importation of aircraft. viAcknowledgements.viiVIII1ST EDITION – NOVEMBER 2018

IntroductionDefinitionsTo avoid confusion and ambiguity, the following key words are defined in this document as below:Abandoned aircraft: Refers to the aircraft permanently parked without a storage maintenance program. Insome cases, the aircraft has been deregistered and it may be impossible to identify the owner.Aircraft owner: In this manual, this term includes the person or organization that has control over whether anaircraft is to be sold or decommissioned.Decommission: Refers to the whole process of retiring, disassembling and dismantling the aircraft.Disassemble (part out): After the aircraft has been retired, the action of removing all the valuable parts andcomponents from an aircraft, which are intended to be reused in the aviation industry.Dismantle: After disassembling the aircraft, the action of taking out other parts for non-aviation purposes andtearing down the rest of the aircraft for recycling purposes.Retire: The action of the aircraft owner to withdraw the aircraft from active service permanently. This does notinclude the process of disassembling or dismantling the aircraft.Stored aircraft: Refers to the aircraft temporarily parked under a storage maintenance program. The aircraftcould return to active service or be decommissioned afterwards.1ST EDITION – NOVEMBER 2018IX

Best Industry Practices for Aircraft Decommissioning (BIPAD)Abbreviations737CL737 Classic737NG737 Next GenerationAC Advisory CircularAD Airworthiness DirectivesADIGAircraft Decommissioning Industry GroupAFRAAir

Abandoned aircraft: Refers to the aircraft permanently parked without a storage maintenance program. In some cases, the aircraft has been deregistered and it may be impossible to identify the owner. Aircraft owner: In this manual, this term includes the person or organization that has control over whether an aircraft is to be sold or .