Fast 5: How PMA Is Driving Opportunities At ATS
The engineering solutions team at Aviation Technical Services (ATS) is focused on developing products and services to support operators, including parts manufacturer approval (PMA) solutions, repair engineering and supplemental type certificate products. Since the team launched its PMA program in 2015, it has developed 202 part numbers and it expects to develop between 50-60 in 2023. Ben Tschirhart, vice president of engineering solutions at ATS, spoke with Lindsay Bjerregaard at the company’s headquarters in Everett, Washington about PMA trends and how these capabilities are playing an important role in the current economic environment.
What role does ATS’s PMA program play in tackling supply chain issues for ATS and its customers?
We have our own supply chain that we manage, and we have a lot of facilities around the Puget Sound area and the rest of the U.S. that we work with. We, of course, buy our inventory and try to stock it with some advanced forecasting based on what we know about our operators so we can keep some product on the shelf. What that means in terms of helping out with the hangar is that when the parts are available, [our technicians] can keep working on the airplane without having to find any kind of a workaround, which might be deferred maintenance, or they have to come up with some complicated or costly repair. We're constantly looking at our stock and our inventory or actively pinging our supply chain, making sure that we're staying ahead of any difficulties, finding product and getting it on the shelf. Even with the raw materials, we’re making sure that we can react to spikes in demand, which we've seen on some occasions where things have been somewhat chunky. We've been very successful reacting to that.
There are certain areas where we're still challenged. A number of extrusions are hard to get right now with excessive lead time. We're just proactively trying to manage that—getting ahead of the curve, placing larger orders and putting stuff on the shelf. Adhesives, chemicals, paint and things like that have also been a challenge. I can't say that we've 100% been successful on everything but we have a very strong and robust supply chain organization, as well as suppliers and vendors that we've worked with that have helped us maintain a very healthy level of inventory.
How do you handle forecasting your inventory needs?
We just talk a lot to customers and try to make sure that we're having good conversations. We like to think of ourselves being positioned to be the operator’s best friend—someone with intimate knowledge about how they operate their aircraft maintenance environment, understanding how they purchase and what they're looking for. We have conversations with them about upcoming service bulletins or service letters that they're planning to implement, and then work to get ahead of their needs. We've had some cases where they come to us before we even had a PMA and we've been able to fast track a PMA development because we knew that they have this need coming and they had concerns around the marketplace being able to support their needs without us.
Aside from conversations with customers, how does the engineering solutions team come up with ideas for new PMA solutions?
We have an ideation program where people in the company can suggest a part or solution. There’s a forum online where they can submit ideas and that then goes to a committee within Engineering Solutions that runs ideas through feasibility analysis and determines whether it’s something we want to develop. If we do develop it, and we actually get the PMA approval on it, then the person who suggested it gets a $1,000 bonus. I think we've had eight or nine part numbers [through the ideation program] that we've developed so far, and we have one or two in the queue right now that are coming, so it's been really good. It gets people involved, it gets them thinking and it gets us all talking. We're looking to expand that idea to try and foster even more ideation from our staff.
What PMA trends are you seeing in the aftermarket?
Where we're seeing trends starting to emerge is in the regional jet side of things. We're starting to see conversations rising up around Embraer. We're not too involved in that yet, but we're starting to dip our toe a little bit. We’re trying to get smart on it and understand what's going on there.
We're seeing more demand in the component side now as well. And we're working more closely with our Dallas Fort Worth facility and trying to understand where there are some opportunities there, as well as at Paine Field Airport here, where can we also help them out in developing some new PMA parts.
How are concerns about inflation impacting your customers’ spending on parts and repairs?
We know PMA is going to be an area where we expect to see a lot more focus from airlines that are trying to mitigate the cost of inflation. OEMs need to focus on building airplanes and developing new products, so their focus on the aftermarket is challenged in some cases. There are parts they're just not able to provide, so that's an opportunity for us to come in there. But also, there's the pricing side of things where PMA typically is a little bit more commercially reasonable from a pricing perspective. And so we would expect to see more airlines asking, ‘Can we even get the part addressing that?’ as the first issue and then, secondly, ‘Can we get a better price?’ And we expect to be in a position to take advantage of that.