IATA Pushes for Open Used Serviceable Material Market

The International Air Transport Association (IATA), representing approximately 300 airlines worldwide, is calling for a significant overhaul in the Used Serviceable Material (USM) market. This push follows a landmark EU aviation antitrust settlement involving Pratt & Whitney Canada (P&WC), which was finalized on August 21, 2026. The IATA jet engine parts initiative seeks to extend the pro-competitive principles established in that case to the broader commercial jet engine sector to mitigate severe supply chain constraints.

The Impact of Supply Chain Bottlenecks

Global aviation is currently grappling with persistent supply chain bottlenecks and parts shortages. According to an IATA-Oliver Wyman study, these operational challenges added an estimated $5.7 billion to airlines' total engine leasing and maintenance costs in 2025. Airlines are increasingly turning to certified reconditioned parts to bypass extended turnaround times that have frequently resulted in grounded commercial fleets. The current reliance on Original Equipment Manufacturer (OEM) exclusive service channels often exacerbates these delays, prompting the industry to seek greater access to independent maintenance, repair, and overhaul (MRO) providers.

Regulatory Context and the P&WC Settlement

Under EU Antitrust Case M.12406, the European Commission Directorate-General for Competition investigated restrictive contractual clauses that prevented independent suppliers from accessing critical engine inputs. The investigation concluded after P&WC agreed to amend its contracts, allowing independent suppliers access to used turboprop engine cores and necessary certification services. This Pratt & Whitney Canada antitrust resolution serves as a catalyst for IATA’s broader campaign. Nick Careen, IATA's Senior Vice President of Operations, Safety and Security, stated that the transition for PT6 and PW100-series engines provides a blueprint for the wider industry. He emphasized that airlines should have the freedom to choose among all regulator-approved maintenance facilities and parts, regardless of the engine type.

Historical Precedents and Industry Resistance

IATA’s current advocacy is not without precedent. In 2018, CFM International reached an agreement—subsequently renewed in early 2026—to allow independent MROs to use alternative parts and repairs on its engines. This agreement acts as a benchmark for the current effort. However, major engine manufacturers have historically argued that they assume significant technological and financial risks during engine development. These firms maintain that exclusive aftermarket services are essential to recoup those long-term investments. Despite this position, the regulatory landscape is shifting, and OEMs now face increasing pressure to adopt more open aftermarket policies.

Technical Analysis: The Economics of Engine Aftermarket Reform

The push for an open USM market represents a structural shift in aviation economics. Historically, OEMs have utilized