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Inventory Management Strategies To Cut Costs

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Inventory Management Strategies To Cut Costs

by usiscc
December 8, 2019
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Inventory Management Strategies To Cut Costs
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SEVILLE–With shortages of new and used serviceable material for certain parts, especially on popular engine types such as the CFM56-5B and -7B, airlines are turning to greater use of data analytics and teardowns.

AFI KLM E&M has saved €1 million ($1.1 million) by using predictive maintenance, says Rodolphe Parisot, the MRO’s chief digital offer. He says by predicting the need for certain part numbers using digital tools, the airline MRO has been able to negotiate with suppliers and source more than 50% of part numbers with used serviceable material.

Alitalia also uses predictive tools to monitor inventory on a rolling basis to right-size stock levels, says Vincenzo Quaranta, head of marketing and sales for engineering and maintenance.

Alitalia also is using PMA and DER whenever it can to save inventory costs. “We need more PMA and DER options to reduce turnaround times, especially when we’re looking at well-known supply chain issues,” he adds.

Alitalia started dismantling owned aircraft itself to obtain used serviceable material. It tears them down and then uses them in is own shops to recertify the parts.

It’s in the process of dismantling an Airbus A321 because the cost of a heavy maintenance check and correcting corrosion would have been cost prohibitive, he says.

The Italian carrier has torn down MD-80, ATR72 and A319 aircraft and is seeing a growing market for its dismantling and repair used serviceable material services.

For new aircraft, Alitalia “establishes leased pool agreements with airlines who already operate the model to right-size our inventory,” says Quaranta. “The initial provisioning list from OEMs is usually excessive,” he adds. The short-term agreements are usually for one year or less and at the end the period “we decide with the pool provider whether to continue the agreement, purchase material ourselves or change the scope of the agreement,” says Quaranta.

AFI KLM also considers pooling agreements for entry into service. Parisot points to the A350, for which AFI KLM E&M started servicing for third-party customer before its parent airline began operating it itself, “so we first looked at the pool effect as we started operating it.”

However, for aircraft such as the A320neo, because of the high parts commonality with A320ceos, pooling isn’t always used.

Both AFI KLM and Alitalia stress collaboratively working with planning, purchasing and maintenance/engineering departments for optimizing inventory is key.

As an example, Quaranta points to engine swaps for the CFM56-5B and GE90 to avoid parts shortages and supply chain issues.

To avoid shop visits or to minimize downtime, Kellstrom is one company that supplies green-time engines. “The engine exchange strategy is key to several airlines, especially some of the smaller ones,” says Al Malecha, Kellstrom’s managing director-Europe, Middle East and Africa.

He’s also seeing sale and leaseback options as being popular.

While CFM is catching up on LEAP program issues, partly because of the Boeing 737 MAX grounding, the follow-on effects for CFM56-5Band -7B parts is still a causing a huge pressure on the aftermarket, says Malecha. For high-demand parts that meet cycle time requirements, in today’s tight market, “you need to bite the bullet when you find the right part with the right cycle times” because the parts prices aren’t going to drop and often will be hard to find again, he says.

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