HI Uplift: ‘Forecasting is our biggest (supply chain) weapon’

insight

by Mike Stones

6 March 2023

Efficient forecasting is a key tactic in the battle to mitigate challenges in the helicopter industry supply chain, according to Helicopter Investor’s latest Town Hall online meeting. Speakers also urged stronger communications along the supply chain, with one recommending greater scrutiny of shipping services and charges.

Mark Richer, manager, MRO, Bell Textron Canada told the Town Hall audience: “Forecasting is our biggest weapon to get over these hurdles until these supply chains get pulled back up again.” Richer acknowledged that the location of Bell’s maintenance, repair and overhaul (MRO) service at its Mirabel, Canada facility delivered supply chain advantages. But the MRO was not immune from challenges.

“Because our professional support engineering and product supply team is here [in Mirabel], we try to rely on them to predict some of the problems coming up and ahead of time to get ahead of the curve,” he said. “We work with our engineering team to come up with solutions to change parts that are maybe obsolete with a newer current version.”

Also, the company’s MROs worldwide were able to provide feedback about parts which are wearing out prematurely. And Bell had tried to repatriate the manufacturing of some of the critical parts in order to “protect our supply chain and keep tighter control of the quality of parts”.

Opened in 2021, the Mirabel MRO has 350 engineers and a total workforce of 1,400 employees. (Bell engineers are able to conduct structural repairs on aircraft that may previously have been deemed salvable, said Richer).

The severity of the challenge in keeping clients flying depends on the type of aircraft they operate, said Joe Hawke, chairman and CEO from helicopter completions and MRO Uniflight Global (pictured). “For in-production aircraft, it’s typically easier to get spare parts,” he said. “The aircraft … that are out of production, where there’s a large global fleet that continues to be supported, tend to be in better supply.”

But there is a third category of aircraft for which sourcing spare parts was particularly challenging. “There are [helicopter] types that continue to be operated that are virtually impossible to get parts from the OEM,” said Hawke. “That relegates the operator, and the MRO that seeks to support them, to cannibalising remaining aircraft in the global fleet just to develop the spare parts.”

For Hawke, one of the best ways to mitigate supply chain challenges is to communicate more actively with customers. “In some cases, we prepare an annual forecast of due items identifying known-life limited or timed-out parts,” he said. Just-in-time logistics also brought a cost to businesses unable to secure parts as quickly as they were needed. “Everyone up and down the value chain who has just-in-time delivery has decided they are allergic to inventory,” said Hawke. “We are feeling the affects of that.”

Disruptions to the helicopter supply chain have not improved and perhaps even worsened recently, agreed Billy Ortega, director of Maintenance at medical transport specialist Intermountain Life Flight. “The biggest thing is the planning piece,” agreed Ortega. “As an operator that means [even more] emphasis on planning and we go into great detail with our MRO,” he said. Weekly meetings help to ensure the operator is planning well in advance of upcoming inspections. “And sometimes we have to get creative with known maintenance coming through the door,” added Orgeta. “But for us, it is the unscheduled events that usually hurt us the most.”

The company is prioritising stocking parts to safeguard against supply chain shortfalls. “So, we create a more robust inventory for ourselves, as well as replying on our MRO to make sure we have the parts on hand.” Tracking aircraft-on-ground (AoG) events that have happened repeatedly enables the company to stock the replacement parts that may be needed to avoid similar events in future. OEMs are not the only ones to hold vital parts. “There are other operators and others who hold parts and are willing to part with them,” said Ortega. “That has helped us get out of a pickle a few times.”

Helicopter shipping and delivery specialist Dave Urban, CEO, Direct Helicopter International questioned the charges made for aircraft transport. “There have been some extraordinary events in the shipping world in the past couple or years,” Urban told the Town Hall audience. “And that has completely re-aligned the way we ship, handle things and the way we tell people what’s going on.”

Urban said it was hard to find a good shipping company and hard to manage supply chains “to know exactly where and how you stand”. The goal is to achieve 24-hour coverage so that businesses know when the delivery will arrive and, crucially, how much you are going to pay. “That’s tough for a lot of companies these days because everyone is trying to save money,” he said.

Greater scrutiny of shipping charges would also pay. He recommended companies probe their shipping costs more closely – who they are paying, what are they paying and what they are getting in return? “I shake my head at the amount of waste I see on the shipping side. It is extraordinary sometimes,” said Urban.

The Helicopter Investor Town Hall – Will the supply chain chill lead to MRO meltdown – took place on February 16th, 2023. You can watch the one-hour online event, sponsored by Aero Asset and chaired by its president Emmanuel Dupuy, here.

Meanwhile, helicopter leasing and a wealth of other industry topics will take centre stage at our Helicopter Investor London 2023 conference at the Royal Garden Hotel on March 22nd and 23rd. Take a look at our action-packed agenda here and book your place at Helicopter Investor London 2023 here.