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OEMs Eye Digitalization, Services and Supply Chain Changes.jpg Airbus

OEMs Eye Digitalization, Services and Supply Chain Changes

Moves to go digital may not lead to major new revenue in future however.

ORLANDO - The accelerating digitalization of the aerospace industry is a necessity, particularly in regards to providing maintenance, repair and overhaul (MRO), but it still will be hard even for the largest manufacturers and may not lead to major new revenue in the near future, a key leader advised April 10.

“Whether you like it or not, this revolution, this disruption, is going to take place,” Johann Bordais, Embraer CEO and president for services and support, told the Aviation Week Network’s MRO Americas Conference & Exhibition. “And I’m not even convinced the answers will come from the people in this room. I’m more worried about the big digital companies, the Googles, I think those guys are actually able to disrupt our markets.”

Speaking as part of a panel of leaders from the original equipment manufacturers (OEMs), Bordais warned the audience that OEMs and aftermarket service providers alike will be challenged to prove their digital offerings provide value to airline customers and others. Simply claiming that operators will get to utilize their equipment more will not be enough, because they already expect to – that is why they chose that aircraft in the first place.

“Being real time is too late,” he said. “You have to be prognostic, you need to look into the future.”

Referring to the so-called Murphy’s Law that whatever can go wrong will go wrong, Bordais said, “My goal is to kill Murphy. This is what digital does.”

Laurent Martinez, Airbus senior vice president and head of business unit services, said his company’s goal is to work in singularity with operators. In that world, airline passengers do not tolerate surprises, and there is negative inflation on ticket prices. Manufacturers and service providers must embed themselves with the operators for everyone to prosper. “Success is together,” he said. “We need to look at the realities.”

Stan Deal, CEO and president of Boeing Global Services, agreed that creating a fast-paced business environment that gets inside operators’ lives remained the main goal of digitalization. Second was achieving cost-cuts and efficiencies that adopting new technologies may bring – and Deal asserted “there’s sizable savings” to be gained. But staying relevant may just be the most important reason of all.

“We have to have this healthy paranoia as an industry and be willing to look outside to change,” Deal said. “That’s the call to action as an industry. We’re all waking up to that realization in different ways. We’re reaching out to different industries, making investments in small companies that are not even in our industry to glean that technology and hopefully bring it in and hopefully disrupt ourselves before we’re disrupted. We all have to have this approach if we’re going to transform this big aerospace ecosystem into its next evolution. We’re certainly focused on that.”

The panel was asked several questions about pressures on their supply chains, as well as independent MRO providers. While diplomatic, the panelists indicated that expectations are rising for everyone, suppliers and OEMs, and so competition and expectations of performance are changing accordingly.

Said Deal, “The world of ‘we have a price and that’s the price for 20 years” is over.”

TAGS: Big Data
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