Supply Chain Role Grows In AOG Events

By Bob Trebilcock
Source: Aviation Week & Space Technology

United is considering the potential of new inventory-management arrangements and partnerships to reduce inventory costs. “We are looking at several different parts providers that can place inventory on consignment in certain locations,” says Rosa. “We have not entered into an agreement yet, but we are looking at the model.”

AJ Walter, for instance, has developed a consignment model in which it owns parts that are boxed and ready for use but are stored at an airline's facility near the production line. “We own the parts, but the airline controls them,” Avery says. One carrier has used this service to provide inventory at locations where it flies on a seasonal basis.

Prentice expects airlines to take a harder look at the use of surplus parts in AOG situations. In Oliver Wyman's most recent MRO survey, two-thirds of the airlines responding report that they expect to moderately or greatly increase the use of surplus parts. However, three-quarters say the primary hindrance is the location of the parts.

“Airlines would love to use more surplus parts in an AOG situation, but getting a part off an airplane in the desert isn't practical,” Prentice says. “As airlines, MROs and secondary providers develop that market, surplus parts will become a bigger part of the solution.”

The new models illustrate the need to continually improve the AOG supply chain. “AOG situations aren't ever going to go away,” says Air Canada's Bentley. “Airlines have to keep streamlining their processes, understanding the maintenance on their aircraft and looking for opportunities to minimize the time for a repair. We have to continue to innovate to stay up with what's happening in an aircraft.”

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