Locatory.com: incorporating OEMs in a carrier’s unified supply chain management system

For some time now the industry representatives have been vigorously discussing the intensifying role of the original equipment manufacturers (OEM) in the aircraft aftermarket. While some market players are expressing their discontent with the OEMs’ intensions to gain much more control over the MRO services as concerns parts and components, it has now become obvious that OEMs have managed to significantly improve their direct communication with aircraft operators, bypassing brokers and other third parties. However, many airlines do not maintain an integrated system of communication with their suppliers and while contacting OEMs directly they are depriving themselves of the solutions, offered by the open market.

As a result of the OEMs natural desire to occupy a larger share of the aftermarket, including MRO services and parts supply, nowadays more and more carriers choose to cooperate with various original manufacturers directly. However, acquiring a new original part is not always the best solution, particularly in the cases when a carrier needs only a temporal replacement of a component. Unfortunately, in case of an AOG or under any other circumstances requiring urgent action, carriers do not have the time to send numerous requests by e-mail or telephone dozens of suppliers. It may seem to be much more time effective to contact the necessary OEM directly, since it is always expected to have the required component.

‘However, such expectations might prove to be wrong, since some OEMs actually have very limited stock capacities. Moreover, one should always consider that OEMs have started penetrating the aftermarket only relatively recently. Many manufacturers haven’t yet fully developed their logistics thus making the deliveries more expensive and less timely,’ commented the CEO of Locatory.com Zilvinas Sadauskas.

Though many carriers sign supply agreements with OEMs while acquiring new aircraft, considering the aforementioned, they cannot feel fully at ease with regard to effective spare parts supply. If an OEM failed to provide the required part promptly, carriers would be forced to waste additional time while conducting the search on the aftermarket and analysing the received offers afterwards.

‘Moreover, while OEMs tend to be the prime component source for the newest aircraft types, the situation in the supply market is constantly developing. For instance, some third-party suppliers have already started scraping Boeing 737 NGs thus supplementing the aftermarket for the relatively new aircraft types. For that reason, in order to save time and ensure prompt solutions in AOG situations, carriers ought to integrate all their potential suppliers including OEMs, preferred vendors and open market offers into one system. Modern e-procurement solutions minimize the need for manual work by both organizing the requests and comparing the reply offers. Maintaining an integrated supply management system is sure to spare carriers not only time, but money as well,’ commented Zilvinas Sadauskas.