Did Deregulation Affect Aircraft Engine Maintenance? An Empirical Policy Analysis

Examination of aircraft engine histories provided by Pratt & Whitney, Inc., indicates a significant increase in the number of engine hours between major overhauls in the period following deregulation. Parametric analysis of times between overhauls, which controls for other variables affecting the length of the shop visit cycle, suggests that deregulation is a significant factor in the change. Logit analysis, however, shows that engine "failures" (as measured by in-flight shutdowns) have not increased as a result of deregulation. These findings suggest that airlines have responded to competitive pressures by optimizing scheduled service times and perhaps by improving the quality of service performed by paying less attention to minor problems between scheduled shop visits.