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CFM International CFM56-5B/-7B

The CFM56-5B and CFM56-7B engines are popular high bypass turbofan engine programs produced by CFM International (CFMI), a joint venture between Safran Aircraft Engines and GE Aerospace. The CFM56-5B is one of two engine options, along with the IAE V2500, that power the A320ceo family of aircraft, and the CFM56-7B is the sole engine option on the 737NG family of aircraft.

The CFM56-5B engine is derived from the CFM56-5A engine, which originally launched in 1984 to power A320 family aircraft. The CFM56-5B entered into service in 1994 with technical improvements from the CFM56-5A that aimed to enhance fuel burn, reduce emissions, and improve time on wing and maintenance costs. The CFM56-5B features a double annular combustor, a four-stage low-pressure compressor and an updated fan case. The CFM56-5B has thrust ratings from 21,600-pound force (lbf) to 33,000 lbf and can power all A320ceo family aircraft. Over its nearly 30-year production run, more than 4,100 CFM56-5B-powered aircraft were delivered. Production of installed engines ended in 2022, but production lines have remained open for spare engine deliveries.

The CFM56-7B engine is an improvement on the CFM56-3 engine that powered earlier 737 aircraft. The CFM56-7B entered into service in 1997 and was designed to improve fuel efficiency and reliability and reduce maintenance costs versus its predecessor. The CFM56-7B features the core and double annular combustor from the CFM56 5B, as well as upgraded fan blades, a low-pressure turbine and full authority digital engine control (FADEC). The CFM56-7B has thrust ratings from 20,600 lbf to 27,300 lbf and powers all 737NG family aircraft. In its nearly 25-year production run, over 7,000 CFM56-7B-powered aircraft were delivered, with production of installed engines ending in 2019. Production lines remain open for military and spare engine production.

CFMI has worked to continuously improve the CFM56-5B and CFM56-7B engines with multiple upgrades. The Tech Insertion (/3) upgrade on the CFM56-5B and CFM56 7B engine became production standard in 2007, aiming to reduce fuel burn, increase time on wing and lower maintenance costs. The Tech Insertion upgrade featured an enhanced high-pressure compressor, newly designed combustion chamber, and upgraded high-pressure and low-pressure turbine blades. In 2011, CFMI introduced the CFM56-7BE, or Evolution, upgrade, which, along with airframe upgrades, aimed to further improve fuel burn and reduce maintenance costs. The Evolution upgrade included additional enhancements to the high-pressure and low-pressure turbines, updated engine cooling techniques and reduced part count. These changes were also incorporated into the CFM56-5B/3 Performance Improvement Package (PIP) upgrade, which also entered service in 2011, featuring a new high-pressure turbine blade, hardware changes, and manufacturing changes to fan and compressor blades and vanes.

Current Market Overview

Both the CFM56-5B and CFM56-7B have large, geographically diverse operator bases consisting of both network and low-cost carriers. Asia is the largest region for both engine types. The CFM56-5B has a larger presence in Europe, and the CFM56-7B has a larger presence in North America, reflecting operator preference for homegrown aircraft in each region.

The CFM56-5B powers approximately 57% of the A320ceo family fleet and is the preferred engine type on the A320-200 and A319 due to improved fuel efficiency at takeoff over the V2500-A5. The top five operators make up just 23.1% of the total fleet. The average age of the CFM56-5B-powered fleet is 13.6 years old, with a significant number of aircraft under the age of 10 years.

The CFM56-7B is the sole engine option for the 737NG fleet, though most engines power 737-800 aircraft, which makes up approximately 71.5% of the 737NG fleet. The top five operators are primarily U.S. majors, which account for approximately 27% of the worldwide fleet. The average age of the CFM56-7B-powered fleet is 14.1 years old, slightly above the CFM56-5B, with a majority of the 737NG fleet under the age of 15 years.

Value Trends

Overall, mba has a positive outlook for the CFM56-5B and CFM56-7B markets. Demand for both the CFM56-5B and CFM56-7B has been strengthening over the last several quarters, with Market Values above Base Values in both cases. Demand for these engines is driven by domestic passenger traffic demand growth, extended MRO turnaround times and supply chain challenges, OEM delivery delays of new aircraft, and limited availability of engines with quality green time in the secondary market. As shop visits are forecasted to peak for both types in the 2026-2028 time frame, demand is expected to remain strong in the near to medium term. Freighter conversion programs for the 737-800 and A321-200 will likely help buoy demand and values for the types in the medium term as well. However, as replacement aircraft, the A320neo and 737 MAX families become ubiquitous in the next 10 years, values may become more volatile for the older types.

The market for the CFM56-7B is presently very heated and has led the current generation narrowbody engine market segment in terms of value recovery for the last several quarters. Market Values have surpassed 2019 highs and are currently 10% to 16% above Base Values. Lease Rates have also surpassed 2019 levels and are expected to remain elevated in the near term as demand for leased engines strengthens and limited availability persists in the marketplace. It has yet to be seen if values for the CFM56-7B have topped out. The market for the CFM56-5B is still heating up but has generally lagged the bullish values recovery of the CFM56-7B. Market Values for the CFM56-5B are still below 2019 highs but are currently 5% above Base Values, indicating market strength. Lease Rates are beginning to surpass 2019 levels and are expected to continue growing in the short to medium term as availability dries up and demand strengthens. Compared to the CFM56-7B and V2500-A5, values for the CFM56-5B likely have the most room to grow in coming quarters.

mba has revised its Base Value forecast for both engine types, extending Base Value appreciation through 2027, which, until recently, was expected to begin depreciating in 2024. This is due to the long-term fleet impacts of delayed new aircraft deliveries extending retirement forecasts for the predecessor types and delaying fleet ubiquity of replacement aircraft.

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