Crossroads Capital on FTAI Aviation
Thesis
FTAI is successfully transforming into a capital-light, high-margin MRO franchise for the CFM56 engine. By using proprietary parts and its vertically-integrated platform, it creates engine 'green time' at a structurally lower cost than competitors. The core business is executing exceptionally well, a key competitive threat seems to have subsided, and new ventures like FTAI Power offer significant incremental upside.
“The core business is executing at scale, a potential threat from GE/Safran looks minimal, guidance is reaffirmed, and optionality is expanding through SCI II and FTAI Power, meaning the position has materially de-risked from our original entry. We remain constructive.”