Airlines are investing in new planes and products but lingering supply chain issues are hampering their plans to meet their sustainability goals and provide better service to customers.

While passenger traffic has seen a strong recovery after Covid-19 disruption, original equipment manufacturers (OEM) have been unable to keep pace with the demand.

“A year ago no new spares were available as factories were shut during the Covid-19 pandemic. Airlines and maintenance repair and overhaul units (MROs) had to largely rely on used parts. Now the situation has improved but the wait time is still 3 to 6 months,” said Rajeev Gupta, CEO of Indamer Group which provides MRO services to airlines and charter companies.

‘Costs rise 30%’

“Cost of many spare parts has increased by 30 per cent and freight rates have doubled. We are calculating our requirements and placing orders for spares and parts six months in advance,” he added.

For airlines, such delays are proving to be costly. Take for instance Air India’s $ 400 million project to refurbish its 40 legacy Boeing 777 and 787 aircraft.

The aircraft refurbish project announced in December 2022 will now only start next year and is set to run till middle of 2027 as Safran (the OEM selected for Boeing 777 aircraft seats) is unable to provide seats on time due to supply chain issues. Safran declined to comment on the seat issue.

“The supply chain issue is the biggest challenge the industry is facing,” Subhas Menon, the director general of the Association of Asia Pacific Airlines (AAPA) said at the trade body’s annual meeting in Brunei last month.

This has forced carriers to extend leases of older planes or as in case of Malaysia Airlines cut flights by around 20 per cent due to a shortage of planes, labour and parts.

‘Time to service doubles’

“Engine servicing used to take around 55 days before the pandemic, but now it needs 100 or more, “ Malaysia Airlines CEO Izham Ismail told attendees at the AAPA gathering.

Some like Gulf Air CEO Jeffrey Goh believe that advanced analytics and artificial intelligence could help airlines to alleviate their engine issues. Speaking at an industry event last month, Goh said shop visits for Gulf Air’s Boeing 787 engines are lasting more than 200 days. “When the engines are eventually returned, 30 per cent of them are then sent back to the MRO providers because they do not pass the required tests,” Goh said, according to a report in Aviation Week Network.

In India, government-owned Alliance Air and IndiGo are facing challenges due to issues related to different Pratt & Whitney engines. Alliance Air has six and IndiGo has over 60 of their aircraft grounded for several months due to engine issues.

And it is not engine issues alone that are hurting ATR operators like Alliance Air. There is a short supply of parts like aircraft landing gear and propellers too.

“Aircraft, engine and cabin OEMs seem to be prioritising new aircraft production over repairs and retrofits. It could take another two years for supply chain challenges to ease. For airlines this means an increase in their costs and market share losses,” said aviation consultant Vishok Mansingh.

An Alliance Air spokesperson said timely availability of required spares is a challenge and this has delayed maintenance activities. “However these issues are temporary and will be resolved quickly as Alliance Air is in talk with the vendor for resolution. Currently we operate to 58 destinations and have plans to further expand connectivity in North East India,” he said.

As per maintenance manuals airlines are required to carry out checks of components and engines after certain stipulated hours or flights. While major works like replacement of a life-limited part in an engine is carried out at a repair shop, routine maintenance is carried out by the airline and for this purpose they keep an inventory of spares as recommended by OEM. Indian carriers virtually import all spares, nuts and bolts required for maintenance and there are calls for local production and stocking.

“Aircraft manufacturers and OEMs must seriously evaluate the high quality and cost efficient manufacturing capabilities that exist in India to build a robust network of supply chains that is currently impacted due to various reasons,” said Manoj Chacko, managing director & CEO of FLY91.

(with inputs from Reuters)

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