Running an airline is an expensive enterprise. The trail of airline failures over the last decade or so speaks to the high-cost and high-risk nature of the business.
The aircraft themselves represent a huge expenditure, whether an airline buys them outright or leases them. But other less-visible costs are almost as high.
When the U.N.’s International Civil Aviation Organization analyzed the typical costs of running a medium-sized commercial aircraft such as a Boeing 757-200, the group found that the cost per hour of maintenance was more than in-services operation costs for fuel and the crew, respectively. Globally, the aircraft maintenance, repair and overhaul (MRO) market is predicted to increase from $118,000 million to $154,000 million by the end of 2025. At the same time, competition has intensified, and ticket prices have been in a steady decline.
In such a demanding environment, managing and reducing the cost of fleet maintenance is critical. Here are five keys to doing it effectively.
- Optimize aircraft design
Planning an airline’s fleet is complex. The age of the aircraft, fuel prices and growth forecasts must be factored in. Aircraft type and design affect many of these considerations, especially maintenance.
No-frills airlines have shown how standardizing the fleet can improve efficiencies, reducing maintenance and operational costs.
Even the design of an aircraft itself can affect MRO spending, as the Mitsubishi SpaceJet shows. Designed with a “clean sheet” approach, SpaceJet is the first aircraft to use Pratt & Whitney’s PurePower engines, which require 60 percent fewer turbine airfoils than conventional turbofan engines.
In combination with the aircraft’s advanced aerodynamics and wing design, the engines give SpaceJet the lowest fuel burn in its class — addressing environmental concerns — as well as the lowest maintenance and operating costs per trip.
- Predict the inevitable
Flight recorders known as black boxes, which help analyze crashes after the fact, have been in use for decades. However, aircraft health monitoring systems (AHMS), which collect and analyze data to warn of potential issues before they occur, are still in their infancy.
These systems can identify “straightforward” maintenance issues, and analysis of AHMS data over time allows engineers to spot more complex problems in advance. There are clear financial benefits to being able to predict when parts need replacing and when a full inspection is needed.
Even small improvements in reliability can lead to significant cost savings — not to mention safety improvements. This is particularly poignant at a time when operators such as Germany’s TUI have warned that the grounding of its Boeing’s 737 Max fleet could result in significant losses this year.
- Put high-tech to work
Robotic systems, which are already established in aircraft manufacturing, are starting to make inroads into routine maintenance as well.
Lufthansa Technik, part of Germany’s national airline, is developing robotic MRO systems, including a robot that can perform digital crack inspections on engine parts using advanced sensors. Typically, maintenance engineers would perform this task using colored dye.
Air New Zealand, which has been at the forefront of developing alternative maintenance, repair and overhaul approaches, is testing a drone for aircraft inspections. It expects this method to reduce the time it takes to inspect a plane from up to six hours to between one and two hours.
In Europe, easyJet and Thomas Cook Airlines have also conducted trial drone inspections using an autonomous drone originally designed for nuclear reactors.
As well as speeding up the maintenance process, the use of drones reduces the risk to human engineers. Instead of having to climb onto the aircraft, they can review the drone’s high-resolution images.
In addition, 3-D printing is fast becoming an essential tool for aircraft operators and MRO companies. For example, rather than companies having to order and wait for replacement polymer parts such as screen surrounds and tray latches, they can use 3-D printers to produce these parts on demand.
- Maintain a highly skilled workforce
Despite the increased use of robots, there is a growing need for human talent. According to Boeing’s 2019 Pilot & Technician Outlook, 769,000 new maintenance engineers will be needed globally over the next two decades.
In the United States alone, 30 percent of mechanics are at, or close to, retirement age, and not enough engineers are qualifying to replace them. This threatens the expansion and modernization of the global airline fleet.
Some projections have suggested that the gap between the supply of mechanics and demand for them could reach 9 percent in the United States by 2027. The problem may be even worse in Asia, where the bulk of the industry’s growth is taking place and the demand for engineers is expected to peak.
This shortfall may raise the cost of maintenance and force airlines to retain more spare planes to avoid cancellations and late departures.
To bridge that gap, aircraft manufacturers, operators and MRO providers need to attract and nurture engineering talent, demonstrating that aircraft service is a varied job that offers continuous development. For example, Mitsubishi Heavy Industries (MHI) Group, the diversified industrial firm behind SpaceJet, enables engineers to broaden their experience within different parts of its global organization. It also helps engineers who are coming to the end of their career pass on their skills to younger workers to support both legacy and modern aircraft.
- Work effectively with MRO providers
Maintenance providers are an essential element of the business strategy of an airline. These teams are a straight extension of the in-house teams that manage airline operations. It goes without saying that the strength of the partnership between the MRO provider and the airline is uniquely important.
It is vital that airlines carry out all necessary due diligence. Finding an MRO provider that understands the needs and expectations of the airline (and has a forward-looking strategy for tackling the challenges outlined above) is crucial to making an efficient and rewarding relationship possible.
In such a dynamic and competitive industry, the airline companies that thrive will be those that constantly innovate and stay ahead of the curve — while nurturing strong partnerships to help them deliver their vision.
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