Image Credits - The Week
Amidst a rebound in travel demand following the pandemic, the global aviation sector faces a maze of obstacles. Despite some improvement, shortages of parts and delays in deliveries continue to impede recovery efforts. Industry experts addressed these ongoing challenges and discussed potential timelines for resolution at the recent Singapore Airshow.
European aviation titan Airbus and its American counterpart Boeing are facing substantial challenges in keeping up with the surging demand for new aircraft. Nevertheless, disruptions in the supply chain caused by the aftermath of the pandemic and geopolitical tensions, particularly the conflict in Ukraine, have resulted in a series of delays. Lead times for vital components such as metals and windshields have significantly increased, stretching to two to five times longer than pre-pandemic levels.
The aerospace sector is grappling with the repercussions of geopolitical instability, notably the shortage of aerospace-grade titanium triggered by the conflict in Ukraine. The ripple effects of the war have led to shortages of materials like inconel and steel, further worsening the industry’s challenges.
The shortage of parts has led to substantial price surges, with certain components seeing spikes of 20%-30%, a stark deviation from the usual annual increases of 3%-6%. Maintenance companies such as Lufthansa Technik are under pressure to adjust rapidly, resorting to tactics like bulk purchasing and in-house repair solutions to fulfil customer contracts amid the turbulent environment.
The ongoing saga of engine groundings, particularly involving aircraft equipped with GTF engines by RTX subsidiary Pratt & Whitney, adds another layer of complexity to the industry’s challenges. Hundreds of planes have been temporarily grounded for thorough engine inspections, a process expected to persist for years. This situation further worsens delivery delays and operational disruptions, adding to the industry’s woes.
Amid the turbulence, airlines and maintenance firms are embracing a paradigm shift in their supply chain strategies. Concepts such as ‘just in time’ procurement are evolving into more resilient models, which entail increased stockpiling of spare parts and the maintenance of localized inventories. These measures are aimed at mitigating risks and ensuring operational continuity in the face of ongoing challenges.
The global aviation industry continues to face challenges on the road to recovery, with persistent parts shortages and delivery delays. Despite ongoing efforts to address bottlenecks, industry stakeholders are preparing for a prolonged journey towards normalization, with estimates indicating a timeline of up to two years for resolution. Adaptation, resilience, and strategic recalibration of supply chain dynamics are emerging as imperatives for navigating through the turbulence, as the industry endeavours to thrive amidst the lingering shadows of uncertainty.
