Renewed operations of the aviation industry highlighted several existing supply chain issues.
As Patrick Waddick, President of Innovation & Operations at Cirrus Aircrafts, explained, the lead time for electronic components has increased from 18 to 30 weeks. High demand and accelerated production came along with shortages of raw materials, increased energy costs, and logistical challenges, as suppliers are scattered worldwide in different regions and the current workforce is insufficient.
According to Gartner, the average downtime costs $5,600 per minute. Raw materials, availability, and supplier efficiency gave rise to concerns even amongst big companies. For example, in response to supplier concerns about excess inventory, Airbus has provided its suppliers with historical demand data to convince them to create safety stocks.
In this complex and highly competitive market, how can Aerospace companies improve their productivity with upcoming trends?
Improvement of the supply chain:
After recent events, Manufacturers are highly focusing on supply chain visibility to mitigate risk efficiently. In upcoming years, the aviation industry will see a high shift from global to regional material sourcing. With improved transparency, manufacturers and supplier are able to improve collaboration and enhance raw material availability.
Focusing on Sustainability:
With high pressure from passengers, the Aviation industry is forced to reduce its carbon footprint by opting for sustainable spare parts sourcing. With technological innovation, the industry can move towards the production of aircraft with sustainable fuels like (SAFs)2 or shift towards propulsion technologies like electric, hydrogen, or hybrid. For instance, Maeve Aerospace, a dutch start-up manufactured an all-electric aircraft with a battery range of up to 550km and rapid charge in 35 minutes.
Existing innovations like online check-ins and baggage claims made operations cost-effective. With an aim to recover lost revenue during health and political crisis, Companies are moving towards cabin innovation in their aircraft, to accommodate more passengers with an option of comfort travel. Also, now there is a high focus on risk assessments of the aircraft.
Unplanned downtime costs industrial manufacturers an estimated $50 billion annually. With the rise of Industry 4.0, manufacturers can improve their raw materials replenishments and improve visibility over their operations. A combination of data and predictive analysis can improve inventory optimization, and product availability and provide end-to-end visibility.
Supply chain and workforce challenges were the most prominent issues for the aviation industry in previous years. Despite these challenges, productivity increased by twenty folds in the last 30 years. Several major manufacturers have embarked on the journey to “de-risk their supply chains” as there are major growth opportunities in the aviation industry.