Inside Chromalloy’s push to disrupt engine OEMs’ aftermarket stranglehold

Turbofan component maker Chromalloy is expanding, seeking to capitalise on the competing needs of two fast-growing segments: aerospace and AI data centers.
At a manufacturing site northwest of Tampa, electron-beam guns blast away at yttrium-stabilised zirconium within the 1,040°C (1,900°F) vacuum chamber of a $30 million German-built ceramic-coating machine.

The resulting “vaporised ceramic” accumulates on high-pressure turbine (HPT) blades – a coating that will keep them cooler when spinning at 11,000rpm inside a turbofan engine.

Two storeys high, the electron-beam physical vapor deposition (EB-PVD) machine is the crowning asset at aftermarket blade manufacturer Chromalloy’s new Oldsmar, Florida plant.

It also reflects the $100 million Chromalloy has invested to expand its product line-up and production footprint.

“We built this 65,000 square feet around that coater,” says Chromalloy vice-president of engineering Mike Zerbe, noting only 15-20 such machines producing turbofan blades are in existence.

The 75-year-old privately held firm, which supplies non-OEM aftermarket turbofan parts, is ramping up to meet demand, not only from the aviation industry but also from AI data centres, which are increasingly seeking aeroengine-derived turbines to generate electricity.

Chromalloy chief executive Chris Celtruda sees opportunity to secure a bigger slice of aviation’s aftermarket pie, predicting long demand and noting that few companies have the capabilities to produce such blades.

“We’re selling parts as fast as we can make them, and we could sell more if we could make more,” Celtruda tells FlightGlobal.

The company produces aftermarket turbofan blades for engines including the CFM International CFM56 (above) and International Aero Engines V2500. Source: Chromalloy

Owned by investment firm Veritas Capital, Chromalloy is in the technically demanding business of manufacturing hot-section turbofan components like high-pressure turbine (HPT) blades.

Only sold in the aftermarket, its parts are replicas of OEM components found on prior-generation turbofans for which patents — typically valid for around 15 years — have expired.

“It’s effectively reverse engineering,” says Celtruda. “The OEMs view us as the devil… OEMs aren’t too happy that we cannibalise a piece of their aftermarket.”

Unsurprisingly, given that level of disdain, Chromalloy’s components are not endorsed by the engine OEMs but are nonetheless approved by the Federal Aviation Administration (FAA) under its Parts Manufacturer Approval (PMA) process.

“The form, fit and function of the part has to be equivalent to the OEM part,” Celtruda says. “There’s nobody really other than us that’s submitting these types of high-complexity parts and able to certify their equivalents to the OEM standards.”

The company makes about 50,000 components annually in Oldsmar but is ramping up and plans to bring new blades to market. Its expansion will allow it to double production, executives say.

Chromalloy also operates a global engine repair business, fixing up parts under the FAA’s Designated Engineering Representatives programme. Again, it offers an alternative to OEMs, whose manuals increasingly call for parts to be replaced rather than repaired, says Celtruda. “We believe we have the know-how and the technology to salvage a lot of these parts.”

The company says it generates more than $1 billion in annual revenue but declines to provide a specific figure.

Narrowbody shift

Chromalloy has long made PMA blades for engines like the GE Aerospace CF6-80C and Pratt & Whitney PW2000 and PW4000.

In 2003, it opened a manufacturing site in Oldsmar under a joint venture with Alitalia, Lufthansa and United Airlines called Belac. Within 10 years, that business secured PMA authorisation for about 10 parts, including for CFM International CFM56s. But the FAA approval process then became more challenging and the JV broke up.

Around 2016, Chromalloy refocused on PMAs, particularly for CFM56s — powering all Boeing 737NGs and some Airbus A320s — and the V2500 Select, the second A320 engine option.

In the last few years it has secured several valuable PMA authorisations: CFM56 HPT blades, nozzles and shrouds, and low-pressure turbine first-stage nozzles; V2500 HPT first- and second-stage blades and high-pressure compressor stage-five, -seven and -eight blades.

Its approvals do not apply to all variants of those turbofans; the OEMs have introduced updates (adding blades or changing the metallurgy, for instance) covered by newer patents.

Celtruda describes HPT blades as key to the entire PMA enterprise; they experience the hottest temperatures and highest pressures, must be replaced most frequently and account for 30-40% of the cost of an engine overhaul.

“Until you get that high-pressure turbine blade approved, it doesn’t drive enough economics to adopt the whole suite,” he says.

Tight supply, broad demand

Numerous factors have recently inflated turbofan component demand and prices. For starters, Airbus and Boeing are pushing to ramp narrowbody jet production and urging engine makers to similarly hike output. Meanwhile, components in those jets’ new-generation turbofans — the PW1100G and CFM Leap — have proven less durable than advertised, driving the need for replacement blades sooner than expected and forcing airlines to ground jets.

Consequently, carriers are flying earlier A320s and 737NGs longer, inflating demand for CFM56 and V2500 parts.

Another factor at play: the AI data-centre boom. Owing to limited local electricity availability, developers of those sites are scrambling to acquire modified turbofans to power them.

Some 40% of Chromalloy’s business comes from that segment – double what it was three years ago, Celtruda says. “This is probably the first time in the 35-plus years I’ve been doing this that you’ve had industrial power and aviation at full utilisation at the same time, and it’s exposing all these capacity limitations.”

“We’ve been deploying a lot of our engineering resources into more ground-power applications,” he adds. “It’s faster for us to certify new parts for ground power because you don’t have the safety-of-flight issue.”

Lufthansa has worked with Chromalloy to develop PMA blades for V2500s, which power older Airbus A320-family jets. Source: Lufthansa

Overcoming blade shortages has proven a tough nut to crack. That is because few firms produce the blades and because production is so technically demanding – “the ultimate black art” is how AeroDynamic Advisory founder and managing director Kevin Michaels describes it.

The handful of producers include OEMs like GE, P&W and Rolls-Royce, which rely to varying degrees on casting suppliers like

Source: www.flightglobal.com — article syndicated from the publisher’s feed; all rights remain with the original publisher.