Despite Challenges, North American MRO Looks Forward
The rollout of new technologies has been a recurrent theme in aviation in recent years. Airlines increasingly are looking to automation to help improve efficiencies while tapping into predictive analytics and drones for maintenance tasks. During the airline roundtable panel at Aviation Week’s MRO Americas conference on April 26, representatives from the technical divisions of Delta Air Lines, United Airlines, FedEx and startup airline Avelo discussed what they are rolling out across their operations.
“There’s some really interesting emerging technology today,” said Dag Johnsen, director of tech ops powerplant engineering at United Airlines who cited drone technology for lightning-strike inspections as particularly interesting. “I don’t think it’s going to make a huge dent in the overall workforce, but there are efficiencies, so emerging technologies like this will make things become more efficient.” However, he does not see this trend extending to more labor-intensive areas such as specific types of engine work.
Penny Jacob, vice president for Commercial at Delta TechOps Services Group, said predictive maintenance is an important area for the Atlanta-headquartered airline MRO. “What we’re doing there is going to drive a lot of efficiency in terms of how we maintain the aircraft,” she noted. “It helps the reliability for the customer as well, so that’s definitely an important area of investment.”
Given its cargo focus, FedEx has invested heavily in areas such as warehousing and related tools. “Sorting packages is just ripe for automation, and we’ve invested tens of millions of dollars into this,” said Leo Warmuth, managing director for aircraft engineering and technical planning at cargo carrier FedEx Express. He shares Jacob’s view that predictive maintenance, and specifically aircraft health management tools, will grow in importance for FedEx operations. “This is so you spend less time with mechanics trying to troubleshoot and get the aircraft up in the air,” he said. “The only challenge to that is as you automate more and as business grows, you still need more people.”
Gary Martin, vice president for technical operations at Avelo Airlines, said the airline has adopted forms of automation ever since its launch in 2021. This included MRO software, where it rolled out an AMOS package across its technical operations. Citing the airline’s reluctance to operate in a paper-heavy environment, Martin said the next step will be to further digitalize the business. “This will be when we eliminate the paper logbooks on the aircraft,” he said. “We weren’t quite ready for this, but very soon we will go into a digital environment, which was a little easier for us since we didn’t have a lot of legacy systems.”
For office roles, the carrier also sees itself as a “virtual” airline, with many of its people working from home, although it holds monthly team meetings lasting one week at its Houston facility. “We’ve enjoyed that flexibility that was made possible by the improvements in the technology,” Martin said of the virtual environment. “You don’t miss phone calls or video discussions you need to have, which are really important.”
Opportunities In Recovery
Dan Abraham, vice president of Commercial Business at Boeing Global Services, said the airframe manufacturer sees digital as one of two key areas of focus going forward across all its businesses. One area where it will have an impact is in parts, where Boeing is looking to improve alignment with customer demand systems to better forecast the stocking of components to ensure greater availability. The second is sustainability. “This is the other big opportunity—how do we support customers in their goals to reduce carbon and fuel burn?” he said. Through platforms such as Flight Deck Advisor from its Jeppensen subsidiary, Abraham said digital technology has helped a 1.5% fuel-burn improvement across its Boeing 787 aircraft program.
Another airframe-maker with a digital focus is Airbus. Dominik Wacht, for Customer Services-North America at Airbus Americas, said this will likely derive from a strategic point of view rather than revenue concerns. The company was investing in digital tools pre-pandemic, but Wacht said things have accelerated at a greater pace in the past two years. “We’ve seen that the pandemic has actually pushed even more demand and [has pushed us to have] more efficient capabilities analyzing the data that we have today.”
However, long-term adoption of these new technologies could be one of the industry’s next big challenges. Wacht said that the future will be about not just having these digital tools available but also working with the customers and employees using them. “We’ve been used to working in a certain way for years and years. It’s a highly regulated industry, and so there’s certain constraints in the way that we can deploy that,” he noted.
The digital focus is also evident in the future long-term plans of engine manufacturers. Mary Prettyman, director of marketing for Commercial Engines at Pratt & Whitney, said the company’s digital transformation, undertaken as part of a five-year plan, presents an important opportunity. “Things like robotics, the connected factory, digital training—these are all key components along with automated visual inspections,” she said. “These types of things are going to take us through to that next level of capability, and driving efficiency and productivity in our aftermarket shops is absolutely vital because that’s where the real opportunity is for us to move the needle on our overall performance.”
While GE Aviation is also rolling out digital strategies, Ryan Gunyan, business operations leader for aftermarket solutions at the engine giant, sees commercial innovation across the aviation industry that is applicable to its CFM56 and Leap engine programs. “On the CFM 56 engine, you’re seeing many more people come onboard to provide new products that we haven’t seen before,” he said. “I think the operators and the lessors are getting better support than ever before.” Gunyan sees this innovation further developing for the Leap engine. “As we bring on branded service agreement shops, we’re going to see continued competition there, and we’re excited to see what those guys can bring to the table,” he added.
Supply Chain Inconsistencies
Global pandemics, geopolitical events and a rise in input costs such as energy and fuel have all contributed to a perfect storm of challenges in today’s aviation MRO supply chain. At MRO Americas, the five key supply chain challenges were cited as a consistent support of parts and material supply, labor-retention challenges, inflation and cost controls, adoption of technology and automation and disaster recovery and readiness for global events.
“The disruptions are pretty much omnipresent,” said Drew Skaff, vice president of supply chain at Republic Airways. “It’s creating a more challenging environment for the industry to recover. We’re feeling the pain as an industry from an energy standpoint and definitely from a labor standpoint.”
The supply of parts and materials was seen by attendees as the biggest challenge for MRO. This was no surprise to Skaff. Republic now operates at around 90% of its capacity in terms of block-hour production and deployed fleet. “If our demand is lower than what it was two or three years ago, we are still dramatically challenged with consistent sources of supply,” he said.
One method the airline has adopted to navigate this challenge is growing its supplier-surveillance strategies, using monitoring tools to track the health of suppliers. “If we do see a supply disruption, we’re at the front end of that versus after we tap out our current inventory,” Skaff said. “We are also asking our suppliers to partner, and we’re trying to understand what their supply chain look like—this entails supply-chain mapping,” he noted. “We want to understand where they’re sourcing their material, whether it’s raw material or finished goods. We want to understand what their labor footprint looks like.”
Benjamin Moreau, senior vice president for strategy and business development at AFI KLM E&M, said OEMs have limited access to alternative sources of parts, and this, along with the pandemic, has led to operators streamlining their inventory, resulting in no buffer. He said the airline-affiliated MRO is diversifying its supply base away from single sources. “We work on finding alternative sources such as [used serviceable material] and dismantling aircraft with matching engines,” he said, while also targeting a wider scope of parts repairs.
Barry Swift, senior vice president of supply chain at AJW Group, said the company has revaluated its relationship with its partners including the OEMs. “It has driven us to adopt a new level of detail on the way in which we discuss and manage the issues and risk-mitigation plans,” he explained. The company factors in the impact of the supply situation as well as the logistics constraints it incurs.