January 10, 2022 - No. 02 In This Issue : China’s aviation sector aims for profitability this year – regulator : Jackson Jet expands footprint with acquisition of Swift Aviation : Allegiant’s Aircraft Order: 737 MAX Vs. A220 Vs. A320neo : Modern logistics system aids, tracks Air Force inventory : Czech Airlines Technics Increases Its Landing Gear Overhaul Capacity : Lawsuit Filed Against Pratt & Whitney and Other Aerospace Companies Over Illegal No-Poach Hiring Agreements : Heart runs successful first subscale test flight for electric aircraft : Supply Chain Woes Force the MRO Industry Into a Perfect Storm : Wewahitchka aerospace company plans to make space travel a reality : POSITION: Research Fellow in Intelligent Engineering for Digital Aviation China’s aviation sector aims for profitability this year – regulator BEIJING (Reuters) – China’s aviation sector will aim to turn losses into profits this year with an expected recovery to 85% of its pre-COVID volume of domestic passenger trips, the aviation regulator said on Monday. China’s domestic air traffic, once the world’s envy after a fast rebound during the pandemic, is faltering due to a zero-COVID policy of quickly stamping out virus clusters regardless of the economic cost. A growing number of imported cases as the Omicron variant spreads around the world have also led the Civil Aviation Administration of China (CAAC) to suspends more international flights recently. The sector has been mired in deep losses since COVID-19 struck in early 2020, with China’s three biggest airlines, Air China, China Eastern Airlines and China Southern Airlines, posting a combined loss of 32.5 billion yuan ($5.10 billion) in the first three quarters of 2021, after a 42 billion yuan loss in 2020. The CAAC, in a work meeting for 2022, said air passenger trips would likely exceed 570 million this year, compared with about 660 million in 2019 before COVID-19. “Barring repeated fluctuations in COVID-19, we will strive to reverse losses and achieve profitability this year,” the CAAC said in a statement. China has been banking on the domestic market to drive a recovery in its aviation sector, while heavily curtailing the number of international flights to discourage travel. The CAAC said on Friday it was targeting 2023-2025 for a recovery in international air travel. ($1 = 6.3724 Chinese yuan renminbi) https://wtvbam.com/2022/01/10/chinas-aviation-sector-aims-for-profitability-this-year-regulator/ Jackson Jet expands footprint with acquisition of Swift Aviation Jackson Jet, based in Boise, Idaho, has announced its acquisition of Phoenix-based Swift Aviation. Starting January 26, 2022, Jackson Jet will begin operations at the new facility located at Sky Harbor International Airport. While Jackson Jet has served the Phoenix region with charter services since opening their operations in Boise in 2005, the Sky Harbor location will be Jackson Jet’s second FBO facility and bring Jackson Jet’s fuel and ground services to a new customer base. Jackson Jet plans to update and make several investments to the Phoenix FBO with the goal of making it one of the top FBOs in the region. “A big thank you goes out to our loyal customers and employees. We’re always interested in ways to grow our footprint and bring top-shelf services to a wider customer base,” said Jackson Jet CEO, Jeff Jackson. “We’re excited the right opportunity came along to both grow ourselves and the services we offer our customers at Sky Harbor.” The acquisition will bolster Jackson Jet’s presence in the intermountain west, which includes an FBO and full charter/maintenance/parts operations in Boise, maintenance operations in Sun Valley and an aircraft based in Coeur d’Alene, Idaho. https://www.businessairportinternational.com/news/jackson-jet-expands-footprint-with-acquisition-of-swift-aviation.html Allegiant’s Aircraft Order: 737 MAX Vs. A220 Vs. A320neo Speaking to investors on Thursday, Allegiant’s management laid out the details in their recent aircraft order campaign in which the Boeing 737 MAX came out victorious. The airline weighted the 737 MAX against the Airbus A220 and Airbus A320neo family of aircraft and weighed various factors. Ultimately, the MAX checked the most boxes for Allegiant, and coupled with its short-term delivery availability, the Allegiant team decided to go big on the aircraft. Allegiant’s Aircraft Order: 737 MAX Vs. A220 Vs. A320neo After months of consideration, Allegiant officially decided on the Boeing 737 MAX. However, it had weighed options from Airbus before reaching this decision. Allegiant weighs three aircraft families Allegiant Air has been looking at several aircraft for the last few months as it decided now was the time to grow. Coming out of a crisis in which leisure reigned supreme and the airline became one of the first to return to its growth plans, the new aircraft order was, in the words of Allegiant’s management, a question of “when not if.” Allegiant currently is an all-Airbus operator, flying 108 Airbus A319 and A320ceo jets. The order campaign involved both Airbus and Boeing, with Airbus coming to the table with two products and Boeing coming with just one. It is not uncommon for airlines to look at several different models before making an order, even if one model might make the most sense from a fleet simplification perspective. In this case, the Boeing 737 MAX beat out what would have been the assumed “winner” of any campaign: the Airbus A320neo. Here’s what Allegiant weighed. Allegiant Air Airbus A320-214 N248NV Allegiant was looking at an aircraft that could take on both growth and replacement roles. Allegiant looked at various criteria when deciding on the aircraft it would order. It needed a new, in-production aircraft that would, preferably, have short-term delivery availability, be a flexible fleet from a family and up-gauge optionality, offer low unit and trip costs, and be highly reliable. This was on top of the traditional pros and cons associated with individual families. Allegiant weighted costs and reliability against the existing Airbus A320ceo family fleet. The Airbus A320neo family This would, on paper, appear to be Allegiant’s best choice. It would let the airline remain committed to a single fleet type while gaining added fuel efficiency and lower maintenance benefits. It met Allegiant’s desire for low costs and high reliability. However, the A320neo family had some shortcomings. One of the biggest strikes against the A320neo family was a lack of availability. Airbus did not have delivery slots for Allegiant until the middle and later part of the decade, and Allegiant was looking to get aircraft sooner rather than later. Given the popularity of this family of airplanes and some limitations on Airbus’ ability to significantly ramp up aircraft production to counteract that, if Allegiant chose this family, it would not have the planes to support its ambitious near-term growth goals. Allegiant’s Aircraft Order: 737 MAX Vs. A220 Vs. A320neo The biggest problem with the A320neo for Allegiant was the lack of near-term availability. Another thing Allegiant noted was that this family would have had the highest acquisition cost, mostly because there are only two variants that Airbus is actively offering. This is the A320neo and A321neo. Based on Allegiant’s presentation, there seemed to be some uncertainty around the A319neo, which has not sold well and has largely been overshadowed by the Airbus A220-300. The A320neo and A321neo come at a higher cost than the A319neo. The A220-300 Allegiant then looked at the Airbus A220-300. This appeared to be the best offering Airbus could provide in terms of near-term availability. However, given the low production rates on the aircraft, it would have extended the delivery schedule. The A220 met Allegiant’s bar for low unit costs, low costs per departure, and high reliability. However, Allegiant had some concerns with spare parts coverage of the aircraft. Allegiant’s Aircraft Order: 737 MAX Vs. A220 Vs. A320neo The A220-300 has been a favorite of some airlines and passengers, but the lack of a firm A220-500 was a strike against the type for Allegiant. Photo: Airbus One of the biggest strikes against the A220-300 is that there is uncertainty around the flexibility of the family. The A220-100 is likely too small for Allegiant, but the A220-300 is the largest A220 variant Airbus currently offers. While there has been plenty of commentary from Airbus that the A220-500 has become something the manufacturer is looking at, Airbus has not officially launched the A220-500, thus leaving uncertainty over the timing of deliveries. For Allegiant, this lack of flexibility was concerning. The winner: the Boeing 737 MAX The Boeing 737 MAX family fit the airline’s base requirements. It had short-term availability, offered low unit costs, low trip costs, high reliability, and high spare parts coverage. While it did add the dual fleet complexity, the need for new aircraft sooner rather than later, and the lack of availability of new A320neos, this appeared to have been a headwind that Allegiant was ready to accept. However, Allegiant has pulled off mixed-fleet operations with successful financial results. Allegiant’s Aircraft Order: 737 MAX Vs. A220 Vs. A320neo As Allegiant indicated a need for family flexibility, it ordered two variants of the MAX family. The order for the 737 MAX includes 30 of the smaller 737-7s and 20 of the larger 737-8 200s. The gauge and family flexibility of the 737 MAX is key. In addition to the -7 and -8, the MAX family includes the in-operation MAX 9 and the MAX 10, though that aircraft is awaiting certification and entry into commercial service. The same is true for the MAX 7, though Boeing is making progress on certification, and MAX 7 deliveries are expected to start this year with Southwest Airlines. Allegiant will take its first MAX aircraft in 2023. Allegiant grows without sacrificing its model Allegiant is plotting a roughly 10% growth rate per annum. Out to 2025, this would put the airline at a fleet of approximately 170 aircraft by the end of the year. The 50 firm MAX jets would make up approximately 30% of that planned fleet and will help lower the airline’s average fleet age. At the same time, Allegiant has made it clear that it will not stop shopping for opportunistic, used aircraft. The airline’s fleet plan out to 2025 includes 22 placeholder aircraft that it expects will mostly be used Airbus A320s. Even when the MAX family is fully delivered, the airline expects to be majority-Airbus. Allegiant’s Aircraft Order: 737 MAX Vs. A220 Vs. A320neo The MAX will not inhibit Allegiant from acquiring some used opportunistic aircraft. There is a lot of flexibility in the Allegiant fleet plan. By 2025, Allegiant believes it may be time to start retiring some of its Airbus A319s and older 177-seat Airbus A320s. Allegiant expects roughly 20 A320 retirements between 2023 and 2025, though it has not yet outlined A319 retirement plans. In terms of operating economics, Allegiant expects to see some favorable results with flying the MAX compared to its existing fleet. The airline released an expected cost per departure comparing the A320ceo to the 737 MAX 8-200 and the A319ceo to the 737-7: Allegiant’s Aircraft Order: 737 MAX Vs. A220 Vs. A320neo Allegiant’s comparison of costs on the A320ceo family versus the MAX family. Estimating a fuel cost per gallon of $2.18, Allegiant expects the MAX 8-200 to have a cost per departure of roughly $10,976 while the A320ceos have a cost per departure of around $12,026. The MAX 7 comes in at $10,495, while the A319ceo comes in at $11,572. Notably, Allegiant highlights little difference in the ownership costs. Allegiant does not expect to need to shed its model of low-cost operations on point-to-point routes. Instead, it appears that its model will be intact, with Drew Wells, Allegiant’s Senior Vice President of Revenue and Planning, discussing the airline’s use of the aircraft in its network: “However, we don’t need increased utilization for these aircraft to make an immediate impact on our financial results. Using 2019 utilization and geographic deployment, we would expect to see meaningful EBTIDA lift simply from using newest generation MAX aircraft.” Allegiant’s Aircraft Order: 737 MAX Vs. A220 Vs. A320neo Allegiant detailed that it expects the MAX to help it meet ambitious financial targets without needing to push utilization harder. Looking at EBITDA (earnings before interest, taxes, depreciation, and amortization), Allegiant expects that the deployment of the MAX and reduced utilization of the existing A320ceo fleet will give it a mid-decade EBTIDA target of $7 to $7.5 million per aircraft while flying the MAX 8 at roughly 8.1 hours of utilization per day and the MAX 7 at roughly 7.3 hours per day. Allegiant chose the MAX for a variety of reasons. While there will be some cost headwinds of the new fleet induction, the airline’s management team has handled a mixed fleet before and cited strong support from Boeing and engine manufacturer CFM in getting to a deal. When all is said and done, Allegiant sees the MAX coming into its fleet without upending its model, allowing it to still run low-frequency, low-utilization schedules while growing EBITDA aircraft to ambitious targets. https://simpleflying.com/allegiant-aircraft-order-comparison/ Modern logistics system aids, tracks Air Force inventory WRIGHT-PATTERSON AIR FORCE BASE, Ohio (AFNS) -- Want to know how many aircraft tires or satellites are in the Department of the Air Force asset inventory? The Integrated Logistics System – Supply, or ILS-S, has the answer. ILS-S is a modern Logistics Information Technology Defense Business System capability that supports Department of the Air Force active-duty, Air National Guard and Air Force Reserve operations, as well as the other military services and their missions depending on where they are located. ILS-S is also a financial data feeder system that provides LogIT support in the functional area of Department of the Air Force base-level supply and materiel management. Its functions include ordering, receiving, storage, distribution, tracking, disposition and movement of supplies, organizational account management, weapon system spares support, cataloging, computing stock levels, mobility, warranty management, financial reporting, inventory control point, supply point, contractor-provided weapon system support, aircraft, engine and missile maintenance, hazardous material management, communications security management, and mobile technology. The system is a modern, elastic, secure, U.S. Air Force Cloud One Amazon Web Services GovCloud application with 120 interface agreements with 46 systems to support 18,000 end users and over 100,000 consumers of ILS-S information at 250 military installations. ILS-S tracks over 35 million assets valued at $18 billion; assets that are optimally distributed and stored across 1.7 million warehouse locations. ILS-S also provides inventory control of 230,000 assets in deployable air transportable containers to support contingencies and special operations. “We track almost every asset the Department of the Air Force uses,” said Staff Sgt. Gabriel Fox, a member of the Business and Enterprise Systems (BES) Directorate’s ILS-S Capability Delivery Team (CDT), which is responsible for operating and maintaining ILS-S. “Everything from dog food, weapons, radar parts, vehicles, aircraft, clothing items and paper.” ILS-S has multiple, modern features and business rules (programming) to track and manage a wide array of DAF assets to include the following: Automatic Sourcing provides event-based, real-time identification of the best enterprise source to satisfy an order ensuring the right decision is made with automated fulfillment. Excess Redistribution leveraging automatic sourcing infrastructure and realizing over $1 billion in costs avoidance by identifying already purchased DAF assets. Real-time Enterprise Asset Visibility spanning the retail and wholesale supply chains presenting total asset visibility in a single comprehensive view. Nuclear Weapons-Related Material enterprise management & asset tracking. High Priority Orders Management provides infrastructure to ensure mission critical weapons systems remain operational and can be extended to other mission areas. Mobility Management providing chemical, biological, radiological and nuclear gear management. Enterprise Orders Management provides real-time management and visibility across the logistics enterprise. Financial Improvement and Audit Readiness compliant system with the ability to apply FIAR readiness to additional capabilities. Proven ability to subsume enterprise systems including high priority order management, mobility, shelf life, and readiness spares for non-airborne assets. Defense Logistics Management Standards compliant with the ability to transform non-compliant enterprise data into compliant DLMS transactions. To “Delight the User” and support a diverse and dynamic mission operations tempo, ILS-S is available 24x7 365 a year. ILS-S processes over 10 million transactions daily to include over 1.5 million orders. Scott Hunter, the ILS-S senior functional manager, said the system is similar to the inventory programs used at auto parts stores. All the stores are connected by the same application and that enables the employees to check inventory and parts compatibility at any store at any time. ILS-S offers the Air Force a similar capability across the Total Force enterprise. This was all made possible by the efforts of the CDT, contractor industry partners and a variety of service providers who worked to transform the ILS-S into a modern, open systems standard Java application operating in an elastic, secure cloud environment, said James Harbison, lead engineer for the ILS-S CDT. The system has also saved money and will continue to do so. “We reduced our annual infrastructure hosting costs $25 million annually, and in FY 2022, we’ll drive down infrastructure costs even further by employing reserved instances in our cloud environment,” said Hunter. To successfully operate, innovate and integrate in a cloud environment, the ILS-S CDT, it’s industry partners and BES service provider teammates have leveraged multiple, modern computing and software development concepts to include the following: Agile and a responsive and ever-improving delivery model emphasizing warfighter collaboration to deliver monthly production releases to support business needs. Development Security Operations pipeline with security scanning, automated infrastructure provisioning and patching, and monitoring. Continuous Integration/Continuous Delivery pipeline with the ability to deploy from development through production in a fully automated fashion in less than one hour, integrating multiple active development and test baselines. Open source makes up the majority of the ILS-S code base reducing the total cost of ownership, and by using industry leading Spring and Apache products, enhances both stability while minimizing learning curves for new developers. Mobile cross platform solution using Progressive Web Application (PWA) technology and a native tablet presence supporting robust mobile application delivery. Enterprise connectivity provides military network interoperability enabling over 46 systems to connect with ILS-S across a wide array of protocols minimizing external system integration efforts. Proven modernization methodology using a “wrap and adapt” model minimizing risk during modernization by decoupling end user and system interfaces from the effort of modernizing the legacy system. Automated Testing with over 17,000 automated functional end-to-end tests using a framework that enables non-technical personnel to develop robust tests. “ILS-S has been blessed with exceptional contractor industry partnerships that enabled us to leverage modern software lifecycle concepts and tools that in the hands of our high-performing contractor development and functional supply subject matter expert teams really changed how we operate,” said Jerard Campbell, ILS-S Acquisitions and Operations Capability delivery manager. “Our release velocity is high. We recently successfully delivered our 42 consecutive monthly release, 22 of those while we’ve been in a COVID-19 induced 100% work-from-home environment, but just as important, we’ve demonstrated the ability to ‘pivot’ as higher priority customer requirements change. We want more of the goodness agility and flexibility can offer in our future support contracts.” The present success of ILS-S is only the beginning. “Our goal as a digital Air and Space Force is to continuously innovate not only ILS-S but all of our enterprise logistics systems by adopting new technologies that will amplify our mission readiness while driving down operational costs,” said Herbert H. Hunter Jr., Business and Enterprise Systems Directorate’s Enterprise Logistics Readiness portfolio manager.” https://www.af.mil/News/Article-Display/Article/2891103/modern-logistics-system-aids-tracks-air-force-inventory/ Czech Airlines Technics Increases Its Landing Gear Overhaul Capacity Czech Airlines Technics (CSAT) in 2021 completed 33 landing gear set overhauls, which exceeds the average annual capacity of the division. Despite the aviation sector performance drop, Czech Airlines Technics (CSAT) has managed to secure a significant number of landing gear maintenance jobs. Last year, the company completed 33 landing gear set overhauls, which exceeds the average annual capacity of the division. The recent modernization of the electroplating and paint shops and additional investments in the landing gear shop equipment have helped to increase the efficiency and quality of work. The division clients include KLM Royal Dutch Airlines, Transavia Airlines, Transavia France, Smartwings and new contract was recently signed also with LOT Polish Airlines. "Despite the challenges in obtaining orders from clients, alongside confirmations of set slots, especially during the last two years, the Landing Gear Maintenance team managed to complete 33 landing gear set overhauls in 2021, which is more than in previous years. In addition, we performed a great number of other repairs, individual component exchanges and electroplating jobs,” Pavel Haleš, chairman of the Czech Airlines Technics Board of Directors, evaluated the performance. Czech Airlines Technics has been performing overhauls of landing gear sets for Boeing 737 aircraft of the new and classic generation for its clients for over 20 years. During the overhaul, CSAT offers its customers the option of leasing or exchanging a spare landing gear set. CSAT currently owns six complete B737NG replacement sets and one for B737CG aircraft type. Last year, CSAT performed landing gear set overhauls for both current long-term clients, such as KLM Royal Dutch Airlines, Transavia Airlines, Transavia France, Smartwings, Neos, TUIfly, Atran Aerospace and Air Explore, and new contract-based customers, namely LOT Polish Airlines, Tarom, Corendon Dutch Airline, Ukraine International Airlines and lessors, such as AMAC Aerospace, World Star Aviation, Aviation Capital Group and Horizon Aviation 4 Ltd. Thanks to the fact that set plans were met in previous years and new job orders have been secured for the upcoming years, CSAT has invested in the equipment and modernization of the landing gear, electroplating and paint shops last year. As a result, the capacity of the provided landing gear maintenance at Prague Airport has been increased. https://www.aviationpros.com/aircraft/maintenance-providers/mro/press-release/21251996/czech-airlines-technics-czech-airlines-technics-increases-its-landing-gear-overhaul-capacity Lawsuit Filed Against Pratt & Whitney and Other Aerospace Companies Over Illegal No-Poach Hiring Agreements HARTFORD, Conn., Jan. 10, 2022 /PRNewswire/ -- The Joseph Saveri Law Firm, one of the country's leading antitrust firms, filed a class action complaint Friday against Pratt & Whitney and other aerospace companies, alleging those companies entered and maintained no-poach hiring agreements for nearly a decade, if not longer. Pratt & Whitney is a subsidiary of Raytheon Technologies Corporation. The Joseph Saveri Law Firm files a no-poach hiring lawsuit against Pratt & Whitney and other aerospace companies. No-poach agreements are agreements between otherwise competing employers not to recruit or hire one another's employees. No-poach agreements are usually kept secret, creating information imbalance, and preventing employees from negotiating higher salaries and more favorable employment terms. For these reasons and others, no-poach agreements are inherently illegal under United States antitrust laws. They are detrimental to labor markets as they suppress employee compensation and reduce job mobility for workers. The lawsuit was filed in federal court in Connecticut on behalf of an engineer formerly employed by QuEST Global Services, an aerospace company also named as a co-conspirator. Along with Pratt & Whitney, the other defendant aerospace companies include Belcan LLC; Cyient, Inc.; Parametric Solutions, Inc.; and Agilis Engineering Inc. Each of these entities supply skilled laborers to Pratt & Whitney for aerospace projects. Also named as defendants are high-level executives who directly participated in the anticompetitive scheme. "The aerospace industry is essential to the local and national economy, and to the security of our nation and the safety of its citizens. This industry's labor market must be fair and competitive for workers who form the backbone of such an important sector of American society," said the plaintiff engineer's attorney, Joseph Saveri. "When aerospace companies engage in these unlawful agreements, they suppress wages across the entire industry. This case's facts clearly indicate these companies intended to do just that. Instead of competing with other firms to retain employees by offering higher wages and better benefits, they denied their employees opportunities for career advancement and compensation for the true value of their skills. We are committed to bringing this crucial case to a successful conclusion and deterring similar illegal conduct throughout the aerospace industry. Its employees deserve nothing less." The Department of Justice recently unsealed a criminal complaint that accused a former Pratt & Whitney executive of participating in a long-running conspiracy with managers and executives at the other defendant aerospace companies, with the goal of restricting the hiring and recruiting of engineers and other skilled laborers. To date, six individuals have been indicted for their roles in the conspiracy. The aerospace industry is a growth market in the United States, employing roughly 2 million people or about 1.4% of the US labor force. These agreements as alleged harmed this industry and the millions of people working in it. Through this lawsuit—Doe v. Raytheon Technology Corp. et al., No. 22-cv-00035 (D. Conn.)—plaintiffs seek treble damages and injunctive relief for the employees harmed by defendants' alleged unlawful no-poach agreements. For more information on the case, please see the firm's case page. SOURCE Joseph Saveri Law Firm LLP https://www.prnewswire.com/news-releases/lawsuit-filed-against-pratt--whitney-and-other-aerospace-companies-over-illegal-no-poach-hiring-agreements-301456790.html Heart runs successful first subscale test flight for electric aircraft Swedish electric aircraft developer Heart Aerospace (Video) has successfully conducted a test flight with a scale model of its ES-19 airplane. The first test flight of the model was conducted last month at Heart Aerospace’s site at Säve Airport in Gothenburg, Sweden. Heart plans to conduct the first test flights of a full-scale prototype of the ES-19 during 2024 and for the ES-19, which will seat 19 passengers and have a range of 400km (250 miles) to enter service on commercial short-haul flights in 2026. Anders Forslund, founder and CEO of Heart Aerospace said, “The most dramatic thing about the test flight was how undramatic it was. The plane performed exactly as we predicted – soaring effortlessly through the air, with a precision take-off and landing. This test flight validated what we already knew – that the ES-19 aerodynamic design is inherently stable and safe.” During the four and a half minute test flight the subscale model flew with an average speed of 125km/h (77mph) and a maximum speed of 150km/h (93 mph). The take-off and landing speed was 85 km/h (53mph/45 kn). With a wingspan of 4.6m, the Heart ES-19 model aircraft is built in scale 1:5 according to the exact dimensions of the full-scale ES-19 aircraft. The model is made from carbon fiber and fiberglass composites whereas the full-scale aircraft will be made mainly from aluminium. Off-the-shelf components, including the motors were used for the on-board systems of the, whileaA full-scale demonstrator of the ES-19 drivetrain has been in ground testing for more than a year. Forslund said, “We are not looking to reinvent the wheel. A lot of startups are presenting very novel aircraft architectures, spending several years in subscale testing just to demonstrate the basic functionality of the aircraft. “We’ve avoided these pitfalls by relying on a conventional aircraft architecture. We can devote almost all our resources to the formal development – bringing this aircraft through certification and into commercial service.” This subscale demonstrator was supported by the Swedish Innovation Agency Vinnova, as a part of the research project “Elise – Electric Aviation in Sweden”. Heart Aerospace is developing the world’s first fully electric passenger airliner for commercial use. https://www.aerospacetestinginternational.com/news/electric-hybrid/heart-runs-successful-first-subscale-test-flight-for-electric-aircraft.html Supply Chain Woes Force the MRO Industry Into a Perfect Storm A convergence of factors makes it tough to maintain and repair aircraft, and officials predict the squeeze will only get worse. Myriad factors are making repairs more and more difficult to make, and the aviation industry is feeling the crunch. Aviation leaders are in the midst of a perfect storm, a convergence of trends conspiring against the MRO sector that are making it increasingly difficult to maintain and repair aircraft across the entire aviation industry—and hitting GA particularly hard. And some believe that the storm may get even more severe before it subsides. “The supply chain is something that is really going to get a lot worse. I don’t see it getting any better,” Ryan Waguespack, senior vice president of the National Air Transportation Association (NATA), told FLYING. Waguespack sees issues his members are facing now—and in the future—across the entire ecosystem, but specifically: • MRO facilities • Avionics providers • Trade organizations • Equipment owners • Operators • Pilots • The dwindling maintenance workforce “I don’t think these problems are going to go away quickly by any stretch,” he says. The problems Waguespack refers to include: • The initial scattering of the workforce resulting from both the early and second-order effects of the pandemic • The surge in demand for airplanes as individuals purchased their own equipment, which also drove the retrofit market • Direct supply chain shortages responding to macro forces around the world. Since the pandemic began to affect markets significantly in March 2020, the industry has been trying to recover from a bullwhip effect—a supply chain phenomenon describing how small fluctuations in demand at the retail level can cause progressively larger fluctuations in demand at the wholesale, distributor, manufacturer, and raw-material supplier levels. Gogo Business Aviation (NASDAQ:GOGO) president Sergio Aguirre gave insight into some of the issues exacerbating the MRO supply chain on a recent “AEA Amplified” podcast. Aguirre noted a list of events including: • OEMs caught flat-footed going into a pandemic with low inventory levels • Increase in personal flying as people began purchasing airplanes to avoid the airlines • The subsequent and ongoing semiconductor chip shortages worldwide • Extreme weather in Dallas, Texas, which led to the shutdown of many electronics factories • The rippling effects of the Suez Canal blockage • Ongoing COVID outbreaks • Backlog and shortages of truck drivers and dock workers needed to deliver equipment to dealers • Rising freight costs driving a shift to air freight • Long lead times on inventory by companies into 2023 and beyond. To be fair, some of the issues facing the industry predate the pandemic and were only made worse by it. For example, an Airbus subsidiary, Satair, expressed concerns about the MRO industry in 2019 that included the now-realized workforce challenges, rising costs, and rising oil prices. Now, a perfect storm has developed as all the things pre- and post-pandemic have become reality. Backlog of Services and Equipment in Shops Big and Small Pre-purchase Inspections To understand the backlog in MRO facilities, FLYING reached out to representatives from Duncan Aviation, the largest privately owned business-jet service provider in the world, and George Baker Aviation, a burgeoning, but smaller facility in New Smyrna Beach, Florida. Options for maintenance work are vast and range from avionics, airframe, powerplant, and other auxiliary services, such as inspections for sales and scheduled maintenance. In its third quarter 2021 report, the General Aviation Manufacturers Association (GAMA) reported that in the first nine months of 2021, turboprop deliveries grew by 40.6 percent and jet deliveries grew by 15.9 percent when compared to the same period in 2020. Added to that, if a 2003 FAA prediction—which said the average age of the U.S.-based single-engine general aviation fleet (about 150,000 airplanes) would reach 50 years in 2020—came to pass, the bulk of airplanes that were bought and sold would be roughly that old. Given that new owners normally complete a pre-purchase or pre-buy inspection in the process of purchasing an aircraft—usually done through an MRO provider—it’s unclear how shops of all sizes would be able to meet the demand. Like getting an appraisal on a new house, a pre-purchase inspection helps buyers and sellers agree on a fair deal based on the state of the airplane. MROs or independent aircraft maintenance technicians help by inspecting the aircraft and providing an unbiased review of the airworthiness of the aircraft. Depending on the airplane, most pre-purchase inspections can be completed within a couple of weeks of scheduling them, with an average total turnaround time of about three days. It comes at a cost, though, especially when a unique model requires personnel with enough knowledge about that model to perform the inspection well. “The issue is that overall, maintenance is [being] scheduled further out than we’ve seen in many, many years.” Steve Gade, vice president, Duncan Aviation However, there have been some indications, at least on popular forums, that suggest some buyers have been skipping these inspections, or rather, doing it themselves, shaking on a deal with sellers, and deferring any undiscovered maintenance to an annual, when a thorough inspection is required. Buyers point to the desire not to miss out on a deal as the reasoning for this. Steve Gade, a vice president at Duncan Aviation and director of aircraft sales and acquisitions, explains that on a broad scale, the issue relates to buyers attempting to book slots for their inspection. Duncan has been unable to answer some of these requests because of other scheduled maintenance on the books from long-standing customers. In fact, Gade explains that the greatest demand for MRO services through his company has been a robust number of regularly scheduled maintenance appointments with established customers, which limits their capacity to do pre-purchase inspections with newer customers. “The issue is that overall, maintenance is [being] scheduled further out than we’ve seen in many, many years,” Gade says. “Specifically, with pre-buys, your typical pre-buys don’t have the luxury of having a 60- or 90-day advance planning for scheduling purposes. So, by the time that they’re ready to commit and put down a deposit and sign an agreement for a pre-buy, the slots have already been filled with the MRO customer base.” So, are new owners just risking it all together? Gade says not quite. “Both buyers and sellers are making concessions with either the degree of the pre-buy inspection or sometimes just a visual walk around in logbook research,” he says. His reason is that buyers and sellers don’t want to “kill the deal.” When asked about the risks involved, or if this practice is advisable, Gade explains that there are provisions that can be met, suggesting that buyers might consider a “limited pre-buy” especially if the airplane’s general make and model is known. This is consistent with a recent report by NBAA’s Insider Operation, which examined the differences between buying domestic versus international equipment. “There can be some cleanup involved with domestic transactions, like verifying all the names are correct and spelled identically on every document, but surprises really aren’t that common when you work with a good broker, title, or escrow company.…International sales can be a lot more challenging, especially in the current frenzy,” notes Josh Mesinger, vice president for Mesinger Jet Sales, in that report. Gade says buyers and sellers would have to consider the purchase price and the risk-reward ratio, and that when his company advises clients, they go over worst-case scenarios, based on their maintenance database. Rubber, Avionics, Spark Plugs, Etc. As for where other hold-ups might be, Curtis Boulware, owner of George Baker Aviation, paints another picture. Boulware’s shop probably sits at the center of the crisis, as most of his customer base is made up of piston-airplane owners, which constitute a significant percentage of the aircraft currently being bought and sold, based on the GAMA report. “I had an operator call me who went in for an engine overhaul, and got it torn down, and the shop said, ‘We can’t find the rubber seal to go round, and the closest we could find is three months out.’” Ryan Waguespack, senior vice president, National Air Transportation Association (NATA) “It’s common things like spark plugs, grease, and oil,” Boulware says, and that the lead time on rubber products such as main landing gear tires from suppliers like Goodyear (NASDAQ:GT) was “six to eight weeks.” In fact, this is consistent with the picture Waguespack painted around petroleum products amid reports from his members. “I had an operator call me who went in for an engine overhaul, and got it torn down, and the shop said, ‘We can’t find the rubber seal to go round, and the closest we could find is three months out,’” Waguespack says. For owners and operators, the inconvenience is more than superficial. “Now you’ve got to plan events that now went from 60 days to 90 days,” Waguespack says. “Not only does that tie up valuable real estate in that repair station—hence why they can’t move products out quicker—now you’ve got an aircraft with two motors that are removed. “Are you going to tell the owner that you’re going to just park it on the ramp? So, it’s very challenging on the repair stations,” he says. A report from the U.S. Bureau of Labor Statistics tracked data to measure the impact of the pandemic on petroleum products. The bureau concluded that in March 2020, “as economic activity slowed sharply across the globe, demand for petroleum and petroleum products plummeted. The drop in demand, coupled with an unexpected increase in supply, led to a collapse in crude oil prices and subsequent impacts on prices for refined petroleum products and other downstream items. “As economies reopened, the initial price downturn gave way to reduced oil production and some renewed demand.” The Bullwhip Effect This lends to the idea of a bullwhip effect, where the rebounding demand began to outpace the supply, and consequently drove oil prices up. As of January 3, crude oil prices per barrel, as tracked by the US Benchmark West Texas Intermediate, sat at $76, about $10 short of the highest cost since October 2014. Compared to the same time in January 2019—a normal year—and 2020, those prices were $49 and $53 respectively. Prices remain elevated now as demand recovers while OPEC is still limiting supply to address the drop-off from that March 2020 cliff. All this to say, of the 42 gallons of oil in a barrel, as much as 16 percent, or six gallons, are used to create the petroleum-based rubber products used to make tires and other consumables like the one Boulware mentions. Invariably, when the oil supply chain sees any fluctuation, maintenance services are affected. Zooming out, manufacturers who use rubber also use natural rubber, most of which—93 percent of the world’s natural supply—comes from southeast Asia. It would’ve been possible to shift supply sourcing, but in this case, a combination of fungus, pre-pandemic rubber tariffs, worker shortages, and climate change has conspired against natural rubber exports globally. Just as consumer demand for electronic products created a semiconductor shortage, the surrounding rubber elements of said products began to overstress the market. It just so happened that the increase in aircraft sales and retrofits coincided with this trend. The Avionics Crisis But what else is holding up the line? “It’s becoming a bigger problem in the avionics department,” Boulware says. His shop is a full-service avionics one, but says Garmin (NYSE: GRMN), one of his avionics providers, has communicated to him that they are having a lot of backorders, as they are “having supply chain issues with microchips and processors and everything coming out of Asia. “We can’t book any more jobs, because nothing’s available,” Boulware says. Boulware’s avionics services are just an add-on to the bigger shop. Still, he fears that smaller shops might have trouble staying afloat. “It’s really going to put the hurt on a lot of smaller avionic shops who can’t finish or even can’t start the jobs they promised or quoted and the jobs that are keeping their doors open.” This is consistent with the results of a recent survey by the Aircraft Electronics Association published in their December 15 “AEA Wired” newsletter, which tells a part of the story. When asked how its members were dealing with the industry’s supply chain constraints, nearly 38 percent of participants said they were simply rescheduling appointments. The next leading response was that nearly 18 percent elected to install similar or alternative products. “If you’re a small shop, and you’re not diversified, you’re going to have a real problem,” Boulware says. Spark Plugs Aren’t Immune One other price increase Boulware admits customers might run into is the rising cost of spark plugs, on the back of surging demand. “A standard spark plug has gone from $18 to $23 to $27. Now a Champion spark plug costs $43. We need 12 of those things. For one airplane, that goes from a $300 bill for a set of spark plugs to over $600 for a set of spark plugs,” he says. For customers, he says the only choice shops face is to pass that cost along to them. How Should Pilots React? The effects on pilots and operators are ugly. Waguespack shared one story of a Gulfstream operator whose scheduled maintenance event—because the shop lacked a critical part—went from two months to six, and despite being quoted and budgeted for $800,000 to $900,000, saw the fee jump another million dollars to nearly $2 million. An aircraft on ground (AOG) maintenance event is a problem severe enough to prevent an aircraft from flying. Technicians have to rush to purchase parts to put the aircraft back into service and avoid flight delays or cancellations. For airlines, Boeing (NYSE:BA) estimates that a one- to two-hour AOG will cost $10,000 to $20,000, or as high as $150,000. These costs may be slightly lower for general and business aviation, depending on the size of the aircraft involved. This can be a shock to the business for operators that need equipment to support operations and keep personnel efficient and safe. AOG events caused by delayed maintenance have multiple second-order effects. Waguespack says he’s advising flight operations departments to start planning earlier with their respective repair stations. “If you have certain issues coming due, go on and start talking to your repair station of the entities that you want to use today. You’ve got to do it four or five months to be prepared.” He admits it might be more expensive than they are used to because stations might negotiate a deposit upfront of 50 to 75 percent—money that customers would probably hold on to longer. But the alternative? Having an aircraft grounded for months. Boulware says his shop is staying as flexible as possible for customers if it keeps the customers flying. “The customers knew that for them to keep optimal, they weren’t going to have to do some type of stop-gap measure, knowing that when their equipment came in, they would have to come back in to get that installed,” he says. Where Are All the Technicians? In its 2021 report, Aviation Technician Education Council (ATEC) said, “In 2020, the FAA issued 30 percent fewer airframe and powerplant (A&P) mechanic certificates than it did the previous year.” Yet, demand for maintenance services has shot up, which means the workforce shortage that predates the pandemic has grown worse. Both Waguespack and Boulware say some customers might be relying on what both called “through the fence,” or unofficial workers who might not have the proper formal certifications. There are other reasons why recruitment is hard. There have been reports of problems including vaccine hesitancy in the workforce—even with mandates in place—and enduring cost of entry, retirements outpacing recruitment, and just a dispersion of talent. “We’ve heard about the ‘Great Resignation,’ but we also don’t talk about the ‘Great Retirement.’ We were sensing a little bit of ‘I’m going to retire from this gig where I’ve worked at this repair station for a number of years, and I’m going to go and become an independent contractor,’” Waguespack says. “Hiring new kids right out of school is really difficult because airlines are just sucking them all up.” Curtis Boulware, owner of George Baker Aviation According to him, the sentiment he’s seeing in the workforce is different. “Culture means more now than anything. People are saying, ‘You know what? It’s not a money thing anymore.’ They’re no longer chasing the dollar; they’re chasing a larger purpose.” “There’s a different culture in business aviation now that’s ‘maybe I don’t want this to completely own me anymore.’” Boulware says his shop is competing with airlines for talent because of their more attractive benefits. “It is very easy to lose employees to different opportunities. One of my younger guys went to work for Allegiant Airlines (NASDAQ:ALGT) because Allegiant was paying so much money [for someone] with [a basic A&P certificate]. “Hiring new kids right out of school is really difficult because airlines are just sucking them all up,” he adds. How does that affect service? Well, local shops, like Boulware’s, must pick their workforce from what he calls a “below average” pool. He says he tries to convince new hires to come work for him by offering as competitive as pay and benefits as possible, but also a more rewarding learning curve. “Working on smaller planes is more rewarding than working on a line,” Boulware says. “You’re going to do more stuff. You’re going to learn more stuff. You’re going to do different things every day, but some guys, the airline mentality appeals to them, simply because they’re going to be doing the same thing every day.” Waguespack seems to agree that the general and business aviation community will have an uphill battle recruiting and will have to come up with new ways to attract talent—especially on the business aviation side of recruitment—because “whether they are truly stable or not, the airlines are perceived as more stable.” He thinks the business aviation industry can work together to offer more stabilized paths for students through things like internships, but especially for programs that support those who lack basic items like tools, or might need upskilling. This support would make for a more compelling case to come work in the industry. ATEC said in its report that the “mechanic population is expected to increase 13 percent over the next 20 years, but ultimately fall 12,000 mechanics short of meeting commercial aviation needs in 2041. This optimistic scenario assumes pre-pandemic certification rates return.” Finding Workarounds To help their customers, each entity has its own communication priority. Waguespack says NATA is gathering information to understand what the pressing events are and exploring how they can assist with compliance. “We’re starting to explore exemptions with MELs [minimum equipment lists] and whether we can get a longer-term exemption on a non-safety-related item, so that we can keep our fleets mobilized rather than parked,” Waguespack says. He says the FAA was able to accommodate new suggestions around training. For instance, during the height of the pandemic lockdowns, training needed to be delivered differently. In some ways that has been good for the industry: “Now we do Part 135 Section 299 check rides for some business via a GoPro camera,” he says. On the shop front, for big players, there’s less of an issue, as they have the capital to expend on inventory—even at a premium—and then pay a restocking fee, so that a customer’s airplane doesn’t sit on the ground. Gade of Duncan says, “There are certain situations where there might be a supply chain issue, but we try and plan for that as much as possible. Sometimes if there’s something that we think may require preordering, it may be worth pre-ordering it and paying a restocking fee if it was unnecessary, versus having the airplane sit another month and wait.” Where Do We Go From Here? “People are going to find lift one way or the other,” Waguespack offers optimistically. He suggests that customers with the wherewithal during AOG events are alternatively tapping into the charter market, though that has second-order effects on the global fleet. Waguespack maintains that the uptick in jet sales and usage means more engine cycles and shorter trip times. When combined with all the other contributing factors, he says that proves that the industry has a long way to go to grapple with what lies ahead. https://www.flyingmag.com/supply-chain-woes-force-the-mro-industry-into-a-perfect-storm/ Wewahitchka aerospace company plans to make space travel a reality WEWAHITCHKA, Fla. (WMBB) — A Gulf County aerospace company is preparing for space travel, but there’s no rocket involved. Skyborne Technology plans to offer regular people luxury rides to the edge of the atmosphere. For the last few years, Skyborne Technology has been developing an airship for disaster relief, now the company is working on a project that would send anyone into space. “The development now has started in which the emergence of an idea is now a reality, in which this is a disaster relief airship behind me, which is scheduled to fly late February, early March this year. Onboard will have similar systems that will be utilized to get to space,” Skyborne Technology CEO Michael Lawson said. The plan is to take the airship up to 68,000 feet, the edge of space. Passengers would see the curvature of the earth and get an idea of what astronauts see from space. Lawson said the airship will be 350 feet in length and 85 feet wide and hold 15 to 20 passengers. And for $50,000 it’s much cheaper than the millions of dollars the private rocket companies are charging for just a few minutes in space. “So this concept is basically a sizing exercise that is making something like the 7-story high airship behind me much larger to be able to accommodate that going objective. So is it a reality? It will be,” Lawson said. Lawson said the 4-engine helium airship can be in space in 6 hours. He wants the 12-hour round-trip to be a luxury experience with dinner, cocktails, and comfortable seating. And it can also be used for other types of travel. “Let’s say you want to go to the Bahamas you’d fly it there, land it, and it can also land in water,” Lawson said. Lawson said they expect this idea to become a reality in just three and a half years. “The economic impact is that if he gets his hangers open and is up the full operation he is going to bring in 71 who knows at least 71 jobs, maybe in the hundreds high paying jobs,” Gulf County Economic Development Coalition Director Jim McKnight said. https://www.mypanhandle.com/news/local-news/wewahitchka-aerospace-company-plans-to-make-space-travel-a-reality/ POSITION: Research Fellow in Intelligent Engineering for Digital Aviation Employer CRANFIELD UNIVERSITY Location Cranfield, United Kingdom Salary £33,809 per annum Posted Dec 17, 2021 End of advertisement periodJan 24, 2022 Ref3852 Academic DisciplineEngineering & Technology, Mechanical & Aerospace Engineering Job Type Academic Posts, Research Fellowships Contract Type Fixed Term Hours Full Time, Part Time School/Department School of Aerospace, Transport and Manufacturing Based at Cranfield Campus, Cranfield, Bedfordshire Hours of work 37 hours per week, normally worked Monday to Friday. Flexible working will be considered. Contract type Fixed term contract Fixed Term Period 18 months (2 posts) and 24 months (2 posts) Salary Full time starting salary is normally £33,809 per annum Apply by 24/01/2022 Role Description Cranfield University School of Aerospace, Transport and Manufacturing welcomes applications from prospective Research Fellows in Intelligent Engineering for Digital Aviation. About the Role We are looking to recruit 4 Research Fellows to support research grants focused on the future of digital aviation, involving uncrewed flight, adversarial artificial intelligence, secure data chain, air space automated management and optimization, counter drone systems and digital twin building. We are recruiting research fellows for these projects to work under the umbrella of our general research vector of autonomous and intelligent systems in digital aviation and advanced air mobility. As Research Fellow you will contribute to the research activities of the Centre for Autonomous and Cyberphysical Systems, especially concerning the specific projects described above. You will be expected to collaborate with the existing staff working in the area and have communications and meetings with our collaborators within the university or in other international universities. About You You will be educated to doctoral level in a relevant subject and have experience of management research using both qualitative and quantitative methods. With excellent communication skills, you will have expertise in social network analysis and a background in Health & Safety would be an advantage. About Us As a specialist postgraduate university, Cranfield’s world-class expertise, large-scale facilities and unrivalled industry partnerships are creating leaders in technology and management globally. Learn more about Cranfield and our unique impact here. Our reputation for leading in the field of autonomous and space systems, applied artificial intelligence and signal processing has been established through more than thirty years of research into this field. We cover all types of autonomous vehicles including airborne, ground and marine as well as space. Recent research includes the airborne monitoring of ground traffic behaviour for hidden threats by autonomous sensor platforms, developing an analytical framework for understanding the behaviours of multiple uncrewed aerial aircraft and creating collision avoidance and path-planning algorithms for Uncrewed Surface Vessels operating out of human eyesight. We work in partnership with industrial clients and research organisations to provide high quality training, research, development and consultancy to meet the challenges of these competitive markets. We have an outstanding international reputation for the quality of our work and our capability of performing both theoretical and experimental studies. Our Values and Commitments Our shared, stated values help to define who we are and underpin everything we do: Ambition; Impact; Respect; and Community. Find out more here. We aim to create and maintain a culture in which everyone can work and study together and realise their full potential. Find out about our key commitments to Equality, Diversity and Inclusion and Flexible Working here. We are currently piloting hybrid working arrangements until April 2022. This means the majority of our staff are spending between 40% and 60% of their time working from the office where job roles allow. How to apply For an informal discussion about these roles, please contact Dr Dimitri Panagiotakopoulos, Senior Lecturer in Uncrewed Traffic Management, or at d.panagiotakopoulos@cranfield.ac.uk https://www.timeshighereducation.com/unijobs/en-us/listing/275311/research-fellow-in-intelligent-engineering-for-digital-aviation/ Curt Lewis