This article is based on an official press release from Smiths Group plc.

Smiths Group Agrees to £2.0 Billion Sale of Detection Division to CVC

Smiths Group plc has officially announced the sale of its Smiths Detection division to funds advised by CVC Capital Partners. The transaction, which values the division at an enterprise value of £2.0 billion, represents the final major step in the company’s strategic restructuring plan initiated in early 2025. By divesting its security screening business, Smiths Group aims to transition into a focused industrial engineering entity.

According to the announcement made on December 3, 2025, the deal is expected to generate approximately £1.85 billion in net cash proceeds for the Group after transaction costs and customary adjustments. The completion of the sale is anticipated in the second half of 2026, pending regulatory approvals and necessary consultations with the Smiths Detection France SAS works council.

Transaction Financials and Valuation

The agreed price of £2.0 billion represents a significant valuation for the threat detection unit. Based on financial results for the fiscal year ended July 31, 2025, the transaction implies a multiple of 16.3 times the division’s headline operating profit of £122 million, and 12.5 times its headline EBITDA of £160 million. For the same fiscal period, Smiths Detection reported revenue of £963 million and total assets of £1,650 million.

Smiths Group leadership has indicated that a “large portion” of the net proceeds will be returned to shareholders, with the remainder allocated to organic and inorganic growth initiatives for the company’s retained businesses. The Board stated that the valuation fully reflects the prospects of the Detection business, a sentiment echoed by market analysts who viewed the price as being at the upper end of expectations.

Strategic Pivot to Industrial Engineering

This divestment completes a broader transformation for Smiths Group. Following the separate sale of Smiths Interconnect to Molex for £1.3 billion, announced in October 2025, the Group is streamlining its portfolio to focus on two primary divisions:

• John Crane: A specialist in flow management solutions for the energy and industrial sectors.
• Flex-Tek: A provider of thermal solutions and fluid conveyance for aerospace and construction applications.

In its official statement, the company described this move as a pivot toward becoming a “premium industrial engineering company.” The restructuring is designed to simplify the Group’s operations and improve capital allocation efficiency.

“The transaction… marks the final step in a major strategic restructuring initiated in January 2025 to transform Smiths Group.”

, Smiths Group Announcement

CVC Capital Partners’ Acquisition Strategy

For CVC Capital Partners, the acquisition secures a global market leader in aviation security and threat detection technologies. Smiths Detection is widely recognized for its x-ray scanners, CT scanners, and trace detection systems used in airports, ports, and urban security environments globally.

CVC has characterized the acquisition as a platform for long-term value creation. The firm highlighted Smiths Detection’s strong market position and its advanced digital capabilities, including automated detection algorithms, as key drivers for the investment. The asset is expected to complement CVC’s existing portfolio in the UK and the aerospace and defense sectors, which includes investments such as Ontic.

AirPro News Analysis

The sale of Smiths Detection appears to be a direct response to long-standing investor pressure to resolve the “conglomerate discount” that has historically weighed on Smiths Group’s share price. By separating its diverse business lines, the Group has unlocked a combined enterprise value of £3.3 billion through the disposals of Detection and Interconnect.

Market reaction suggests the strategy is working. Shares in Smiths Group rose approximately 2-3% following the announcement. Analysts at Panmure Liberum noted that the £2.0 billion price tag was at the “top end” of market expectations, which had ranged between £1.3 billion and £2.0 billion. This successful valuation, combined with the earlier sale of Interconnect, validates the Board’s decision to break up the conglomerate structure in favor of a streamlined industrial focus.

Frequently Asked Questions

When will the transaction close?
The sale is expected to complete in the second half of 2026, subject to regulatory clearances and consultations.

What will Smiths Group do with the money?
The company intends to return a large portion of the £1.85 billion net proceeds to shareholders, with the rest used to invest in the growth of its remaining divisions, John Crane and Flex-Tek.

Who are the advisors on the deal?
Goldman Sachs and J.P. Morgan are acting as financial advisors to Smiths Group, with Freshfields providing legal counsel. Barclays and Latham & Watkins are advising CVC Capital Partners.

Sources

• Smiths Group plc

Turkish Airlines’ Potential Switch from Boeing 737 MAX to Airbus: An Industry Analysis

The commercial aviation sector is no stranger to high-stakes negotiations, but recent developments involving Turkish Airlines, Boeing, and engine manufacturer CFM International have brought renewed attention to the complex dynamics shaping global fleet decisions. At the heart of the matter is Turkish Airlines’ tentative order for up to 150 Boeing 737 MAX aircraft, a deal that now hangs in the balance as the airline considers switching to Airbus if engine supply terms are not met.

This potential shift is significant not only for the parties directly involved but also for the broader aviation industry. It highlights the influence of supply chain pressures, the strategic leverage that large airlines can wield, and the evolving landscape of aircraft and engine procurement. By examining the facts, perspectives, and industry context, we can better understand the ramifications of Turkish Airlines’ public ultimatum and what it signals for future fleet strategies.

Background and Significance of the Turkish Airlines Order

In late September 2025, Turkish Airlines announced a major agreement with Boeing, including a firm order for 75 Boeing 787 Dreamliners and an intention to purchase up to 150 Boeing 737 MAX aircraft. This deal is a key component of Turkish Airlines’ “Vision 2033” strategy, which aims to dramatically expand its fleet and passenger numbers by the airline’s centennial year.

However, the finalization of the Boeing 737 MAX order has always been contingent on reaching a separate agreement with CFM International, the sole engine supplier for the 737 MAX. The negotiations have reportedly centered on the cost and maintenance terms for the engines, with Turkish Airlines seeking more favorable conditions.

This is not the first time Turkish Airlines has made headlines for its ambitious fleet plans. In December 2023, the airline placed a substantial order with Airbus for 355 aircraft, including 250 A321neos. This existing relationship with both major manufacturers gives Turkish Airlines considerable leverage as it negotiates the terms of its future fleet.

The Engine Supply Dilemma

The crux of the current standoff lies with CFM International, a joint venture between GE Aerospace and Safran. As the exclusive engine supplier for the Boeing 737 MAX, CFM holds a pivotal role in the negotiations. Turkish Airlines Chairman Ahmet Bolat has publicly stated that if CFM does not offer “feasible economical terms,” the airline will consider switching its order to Airbus, which provides a choice of two engine suppliers for its A320neo family: CFM International and Pratt & Whitney.

This dual-supplier model gives Airbus a strategic advantage, allowing airlines to negotiate better terms and reduce dependency on a single supplier. For Turkish Airlines, the ability to choose between engine manufacturers is a significant bargaining chip, especially in an environment where supply chain disruptions have increased costs and delays.

The situation is further complicated by broader industry pressures. Engine manufacturers are facing production and maintenance backlogs, leading to longer wait times and higher costs for airlines. These challenges have made the terms of engine supply agreements more critical than ever in the decision-making process for new aircraft orders.

“If CFM comes to feasible economical terms then we are going to sign with Boeing. If CFM continues its stance we’ll change to Airbus. With Airbus I have choices.”, Ahmet Bolat, Chairman, Turkish Airlines

Fleet Composition and Growth Strategy

Turkish Airlines operates one of the largest and most diverse fleets in the world, with aircraft from both Airbus and Boeing. As of mid-to-late 2025, the airline’s fleet consists of approximately 382 to 440 aircraft, including a mix of narrow-body and wide-body models. The breakdown includes significant numbers of Airbus A319, A320, A321, and A321neo jets, as well as Boeing 737-800, 737-900ER, 737 MAX 8, and 737 MAX 9 aircraft.

The tentative order for up to 150 Boeing 737 MAX aircraft represents Turkish Airlines’ largest potential single-aisle order from Boeing. However, should negotiations with CFM International fail, the airline is expected to turn to the Airbus A320neo family to fulfill its narrow-body requirements. This would further strengthen Turkish Airlines’ partnership with Airbus, following the December 2023 order for 220 Airbus aircraft.

The airline’s “Vision 2033” strategy is ambitious, aiming for a fleet of over 800 aircraft and the capacity to carry 170 million passengers annually by its 100th anniversary. These targets underscore the importance of securing reliable, cost-effective engine supply agreements to support sustained growth.

Industry Context: Supply Chain Pressures and Strategic Leverage

The ongoing negotiations between Turkish Airlines, Boeing, and CFM International are set against a backdrop of significant challenges in the global aviation supply chain. Engine manufacturers, including both CFM and its competitor Pratt & Whitney, have struggled to keep up with demand, resulting in production delays and maintenance backlogs.

These disruptions have led to increased costs for airlines, as the price of both new and used engines has risen and wait times for repairs have grown. In response, many airlines have been forced to keep older, less fuel-efficient aircraft in service for longer periods, which further drives up maintenance expenses.

The limited number of engine suppliers for new-generation aircraft has created a seller’s market, giving manufacturers significant leverage in pricing and contract negotiations. Airlines seeking to expand or modernize their fleets must navigate these constraints while balancing cost, reliability, and long-term operational needs.

The high demand for new, fuel-efficient engines and the limited number of suppliers has given manufacturers significant leverage in pricing and contract negotiations.

Perspectives from Key Stakeholders

Turkish Airlines has taken a proactive stance, publicly leveraging its position as a major customer to push for more favorable engine supply terms. By highlighting the flexibility offered by Airbus’s dual engine supplier model, the airline is signaling its willingness to pivot if necessary to achieve its strategic objectives.

Boeing and CFM International, meanwhile, have declined to comment on the specifics of the negotiations, adhering to standard industry practice during sensitive commercial discussions. Airbus has also refrained from making official statements regarding this particular situation but has previously emphasized its strong relationship with Turkish Airlines, especially after the large order in December 2023.

The outcome of these negotiations will be closely watched by other airlines and industry stakeholders, as it may set a precedent for future aircraft and engine procurement strategies in an era of ongoing supply chain volatility.

Broader Implications for the Aviation Industry

The standoff between Turkish Airlines and CFM International is emblematic of broader trends in the aviation industry. As airlines seek to modernize their fleets and reduce operating costs, the terms of engine supply agreements have become a critical factor in aircraft selection. The ability to choose between multiple engine suppliers, as offered by Airbus for its A320neo family, can provide airlines with greater bargaining power and flexibility.

At the same time, the current supply chain disruptions have underscored the need for resilience and adaptability in fleet planning. Airlines must weigh the risks and benefits of different procurement strategies, taking into account not only the upfront costs but also long-term maintenance and operational considerations.

As Turkish Airlines evaluates its options, the industry will be watching to see whether this high-profile negotiation leads to broader changes in how airlines approach engine and aircraft procurement in the years ahead.

Conclusion: Key Takeaways and Future Outlook

Turkish Airlines’ public consideration of switching its Boeing 737 MAX order to Airbus underscores the growing importance of engine supply terms and flexibility in fleet planning. The airline’s willingness to leverage its purchasing power reflects the shifting dynamics of the aviation industry, where supply chain disruptions and rising costs have made strategic procurement decisions more complex than ever.

Looking ahead, the outcome of these negotiations could influence not only Turkish Airlines’ future fleet composition but also broader industry practices. As airlines continue to navigate supply chain challenges and seek greater leverage in their dealings with manufacturers and suppliers, the balance of power in the aviation sector may continue to evolve.

FAQ

What prompted Turkish Airlines to consider switching its Boeing 737 MAX order to Airbus?
The decision is primarily driven by negotiations with engine supplier CFM International over the cost and terms of engine supply and maintenance. If favorable terms cannot be reached, Turkish Airlines may switch to Airbus, which offers more flexibility in engine supplier choice.

What are the alternatives if the Boeing 737 MAX order does not proceed?
Turkish Airlines is likely to order aircraft from the Airbus A320neo family, such as the A320neo or A321neo, to fulfill its narrow-body fleet requirements.

How does the engine supplier situation differ between Boeing and Airbus?
Boeing’s 737 MAX is exclusively powered by engines from CFM International, whereas Airbus offers a choice between CFM International and Pratt & Whitney for its A320neo family. This gives airlines more leverage and flexibility when negotiating terms.

How large is Turkish Airlines’ current fleet?
As of mid-to-late 2025, Turkish Airlines operates a fleet of approximately 382 to 440 aircraft, with a mix of Airbus and Boeing models.

What is the broader industry context for these negotiations?
The aviation industry is currently facing significant supply chain disruptions, particularly in engine production and maintenance, leading to increased costs and delays for airlines worldwide.

Sources

• Reuters

Navigating Aircraft Pre-Purchase Inspections in a Challenging Market: Industry Analysis and Strategic Response

The aviation industry in 2025 faces a convergence of operational and economic challenges, with aircraft pre-purchase inspections becoming increasingly complex due to supply chain disruptions, parts shortages, and a critical labor deficit in maintenance services. Recent guidance from Axiom Aviation highlights how these factors have fundamentally transformed the inspection process, introducing new risks and demanding adaptive strategies from all stakeholders. What was once a relatively straightforward procedure has evolved into a strategic operation requiring careful planning, expert guidance, and flexible execution to navigate successfully.

Aircraft pre-buy inspections now intersect with broader industry issues such as inflated costs, extended lead times, and limited maintenance facility availability. These challenges have significant implications for buyers, sellers, and service providers, impacting transaction timelines, financial planning, and risk management. Understanding the current landscape is essential for anyone involved in aircraft acquisition, as even minor parts issues discovered during an inspection can stall transactions for weeks or months, altering the risk-reward calculus for all parties involved.

This article provides a comprehensive analysis of the evolving aircraft pre-purchase inspection environment, examining the impact of supply chain and labor shortages, cost implications, industry responses, and future trends. Drawing on expert opinions and recent data, we break down the facts and offer insights into navigating this complex market with professionalism and strategic foresight.

Background and Historical Context of Aircraft Pre-Purchase Inspections

Aircraft pre-purchase inspections have long served as a cornerstone of safe and successful aircraft transactions. Initially conceived as a means for buyers to verify the airworthiness and maintenance status of an aircraft, akin to a home inspection in real estate, these evaluations have grown in scope and complexity over the years. Today, pre-buy inspections are comprehensive assessments that examine the technical, regulatory, and financial aspects of an aircraft, often forming the basis for price negotiations and contractual adjustments.

The typical inspection process covers a range of elements: airframe integrity, engine performance (including borescope and compression checks), avionics functionality, maintenance record verification, fuel and hydraulic systems, landing gear, and cabin condition. The goal is to identify discrepancies or potential liabilities before finalizing a purchase. Historically, these inspections operated on the assumption of stable supply chains, ready parts availability, and adequate maintenance facility capacity. However, recent disruptions have challenged these assumptions, requiring a reevaluation of inspection protocols and risk management practices.

Maintenance, repair, and overhaul (MRO) facilities once offered predictable lead times and stable pricing, allowing for efficient scheduling and completion of pre-buy inspections. As regulatory requirements and technological advancements increased, so did the complexity and importance of thorough due diligence. The current environment, shaped by pandemic aftershocks and global supply chain instability, has upended these historical norms, forcing stakeholders to adapt to a new reality where delays and cost overruns are common.

“A pre-buy inspection is no longer a box-ticking exercise, it’s a strategic operation that can make or break an aircraft transaction in today’s market.”

Current Market Challenges and Supply Chain Disruptions

The 2025 aviation market is defined by unprecedented supply chain challenges, most notably in the availability and cost of spare parts. Aviation parts prices have risen at a pace outstripping general inflation, driven by higher material costs, post-pandemic demand, trade policy changes, and delays from original equipment manufacturers (OEMs). The scarcity of key components has created direct impacts on inspection timelines and costs, with even routine parts replacements now capable of stalling transactions for extended periods.

Maintenance facilities, particularly Tier 1 centers known for high-end inspections, are booked months in advance. As a result, buyers and their representatives are increasingly turning to Tier 2 and Tier 3 centers, which may offer shorter lead times but require careful vetting to ensure quality and expertise. This shift necessitates a broader network of trusted contacts and a willingness to adapt to alternative inspection arrangements.

Supply chain issues have also led airlines to defer fleet replacements and extend the average age of their aircraft, further increasing demand for maintenance and inspection services. The ripple effect is evident: more aircraft require inspection and repair, but fewer resources are available to meet this demand. The result is a highly competitive environment for inspection slots and parts, with buyers needing to plan further in advance and remain flexible in their approach.

“The days of scheduling a pre-buy inspection on short notice are over, advance planning and contingency strategies are now essential for success.”

Aviation Parts Shortages and Cost Implications

The aviation parts shortage has reached critical levels, with notable financial consequences for all market participants. Recent U.S. tariffs on key aerospace materials like aluminum and titanium have driven up input costs for manufacturers, which are then passed on to MROs, operators, and buyers. Major OEMs have reported that these higher costs threaten their competitiveness and production schedules, while smaller suppliers often have little choice but to increase prices directly.

One visible impact is the record number of relatively new aircraft in storage, particularly those affected by engine component shortages. For example, more than 1,100 aircraft less than 10 years old are currently grounded, with the majority equipped with specific engine types facing supply bottlenecks. These groundings reduce available inventory and increase competition for both aircraft and inspection services, adding to the financial and operational pressures on buyers and sellers.

Beyond the cost of parts themselves, extended downtime, hangar fees, alternative sourcing premiums, and delayed transaction costs all contribute to the overall financial burden. Buyers must now factor in not just the direct expense of inspections, but also the opportunity costs and potential for protracted negotiations if parts or repairs are delayed.

Labor Shortage Crisis in Aviation Maintenance

Labor shortages in aviation maintenance have compounded the challenges posed by supply chain disruptions. Industry projections suggest a deficit of up to 48,000 aircraft maintenance workers by 2027, with most technicians currently over 40 years old and a limited pipeline of new entrants. Training programs, while robust, cannot keep pace with the rate of retirements and industry growth.

This shortage affects every aspect of the inspection process, from extended repair times to higher labor costs and longer facility booking periods. Maintenance shops are operating with reduced capacity, making it harder to schedule inspections and complete necessary repairs in a timely manner. The result is a bottleneck that can extend transaction timelines and increase costs for all parties.

To address these issues, the industry is investing in workforce development, including partnerships between educational institutions and airlines, competitive salary packages, and enhanced benefits. However, these initiatives will take time to yield results, and in the meantime, buyers and sellers must plan for continued constraints on maintenance capacity.

“The combination of parts scarcity and skilled labor shortages means that every inspection must be approached with flexibility and a robust risk management plan.”

Industry Response and Strategic Approaches

Faced with these challenges, the aviation industry has developed new strategies to navigate the pre-purchase inspection process. Axiom Aviation and other experts recommend proactive planning, including early identification of inspection facilities and advance scheduling to secure limited slots. Thorough record reviews before physical inspections can help identify potential issues and allow for contingency planning.

Conditional contracting has emerged as a practical response, linking transaction terms to parts availability and delivery timelines. This approach distributes risk between buyers and sellers and ensures that all parties understand the dependencies involved. Modular or phased inspections, where non-invasive checks are conducted first and more detailed examinations follow after contractual milestones, are also gaining traction as a way to balance thoroughness with operational efficiency.

Education and communication are key themes in the industry’s response. Service providers are working to ensure that buyers understand the complexities of the current market, the value of targeted inspections, and the importance of flexibility. By setting realistic expectations and providing clear guidance, they help clients navigate the process with confidence despite ongoing uncertainties.

Market Trends and Financial Impact

Despite operational headwinds, the aircraft pre-purchase inspection market continues to grow. Projections indicate that the global market will reach $2.5 billion by 2025, with a compound annual growth rate of 7% from 2019 to 2033. This growth is driven by rising demand for used aircraft, stricter regulatory requirements, and advances in inspection technology.

Regional trends show North America and Europe dominating the market due to large aircraft fleets and established MRO infrastructure, while Asia-Pacific and the Middle East are experiencing rapid growth. Private jet activity, particularly in the United States, remains strong, with business jet departures and active aircraft tails both increasing year-over-year in early 2025.

Inspection costs vary widely, from $600 to $2,500 for basic jet inspections, with more comprehensive packages reaching significantly higher figures when major issues are discovered. Extended timelines and opportunity costs further inflate the overall expense, making careful planning and budgeting essential for successful transactions.

“In today’s market, the true cost of a pre-buy inspection includes not just the inspection itself, but also the price of time, risk, and missed opportunities.”

Conclusion

The landscape for aircraft pre-purchase inspections in 2025 is marked by complexity, risk, and the need for strategic adaptation. Supply chain disruptions, parts shortages, labor deficits, and facility constraints have fundamentally changed the way inspections are conducted, requiring all stakeholders to embrace new planning, risk management, and contractual approaches. The financial implications extend beyond direct service costs to include extended timelines, opportunity costs, and risk premiums.

Despite these challenges, the industry has demonstrated resilience and innovation, with service providers developing new methodologies and leveraging technology to maintain quality and efficiency. Looking ahead, early planning, flexible execution, and comprehensive risk management will remain essential for navigating the pre-buy process. The sector’s ability to adapt to ongoing challenges will determine its continued growth and success in supporting aircraft transactions worldwide.

FAQ

What is a pre-purchase inspection in aviation?
A pre-purchase inspection is a comprehensive technical and records evaluation of an aircraft conducted before a transaction to assess its airworthiness, maintenance status, and potential liabilities.

Why are aircraft pre-buy inspections taking longer in 2025?
Inspections are taking longer due to global supply chain disruptions, parts shortages, and a shortage of skilled maintenance technicians, all of which extend repair and scheduling timelines.

How can buyers mitigate risks associated with delayed inspections?
Buyers can mitigate risks by planning inspections well in advance, conducting thorough record reviews, considering conditional contracting, and working with experienced advisors who can navigate facility and parts constraints.

Are inspection costs rising, and why?
Yes, costs are rising due to increased prices for parts and labor, extended downtime, and higher demand for limited maintenance facility capacity.

What innovations are helping the inspection process?
Technological advancements such as drone inspections, advanced non-destructive testing, and digital record-keeping are improving efficiency and thoroughness in the inspection process.

Sources

• Axiom Aviation Release