MARPA is in Singapore this week for MRO Asia-Pacific promoting all things PMA. The first day of the MRO conference agenda dedicated substantial discussion (as they usually do) to market forecast and trends. Some of these trends could be an opportunity for PMA manufacturers, but others could mean significant challenges down the road if companies are unable to adapt.
The opening session presented a discussion of trends in supply chain logistics. One of the largest takeaways was the change in inventory management practices, especially in the Asia Pacific region, from a just-in-case model, to a just-in-time (JIT) model. This follows the trend in many other industries, including manufacturing and retail, which enable businesses to reduce costs by carrying less inventory.
PMA manufacturers are in an excellent position to benefit those customers shifting to a JIT model because PMA parts can help customers defray the costs associated with warehousing and inventory management, which is outside of the customers’ core competency. This applies to both operators and MRO facilities. This is because PMAers have the parts on the shelf ready to go, eliminating the need for users to maintain parts inventories themselves to ensure availability.
But the shift to a JIT model also presents certain challenges in Asia Pacific, particularly for AOG situations or other scenarios demanding quick turn times. In certain markets with well-established MRO markets, like Japan and Singapore, getting parts to the customer is often a fairly straight-forward exercise and can be done overnight from the United States. However, in less-developed markets and countries in the region, import and customs requirements can pose significant barriers, meaning delays of several days in clearing the shipment and getting the part to the customer. Those companies able to most efficiently navigate those challenges will be at a competitive advantage.
Another trend in Asia Pacific is the MRO spend focused on the narrow body fleet–namely the 737 and A320 families. The narrow bodies currently account for approximately 70% of the MRO spend in the region (and are the two largest fleets by type). This trend should continue over the next decade for two reasons: (1) a significant number of these aircraft have been delivered over the last decade (and continue to be delivered); and (2) the commonalities that exist between the current gen aircraft and the Max and neo versions of the aircraft.
Finally, an emerging trend that should be of great concern to PMA manufacturers is the shift by component and airframe OEMs toward power-by-the-hour agreements. The PMA industry has already seen the problems that are caused when OEMs use PbH agreements as engine OEMs have taken significant steps to lock up the engine spares market. Although the percentage of PbH agreements in component and airframe is still small, it is growing. PMA manufacturers need to get out in front of this trend and remind their customers that they are a) not obliged to sign such agreements and b) demonstrate the value of PMA in terms of cost, reliability, and customer service offered by PMA. It can also benefit smaller PMA companies to form partnerships with other manufacturers of complimentary product lines to offer greater benefits to customers.
MARPA will work to stay on top of these trends. We welcome any information or questions our members have that can help MARPA continue to craft its strategy.
Last week, MARPA participated at the Tokyo Aerospace Symposium 2015 in Japan. The event drew operators, part manufacturers, equipment and tooling manufacturers, and technology companies, among others, to the Tokyo Big Site convention center to discuss current and emerging manufacturing and regulatory issues, as well as display exhibitor capabilities on the trade floor.
Jason Dickstein and Ryan Aggergaard from MARPA, joined by Akira “Jay” Kato, advisor to the Tokyo Metropolitan Government Aviation Industry Participation Support Project and President of JK Tech Consulting Inc., gave a panel presentation discussing PMA and MRO business trends and discussed ways manufacturers can partner with U.S. PMA companies to develop synergistic relationships that can benefit both U.S. and Japanese companies. Many of the manufacturing companies in attendance expressed an interest in seeking out U.S.-based manufacturing partners to develop a supplier or other type of business relationship, and some stated that they had already developed supplier relationships with U.S. PMA manufacturers.
The Tokyo Aerospace Symposium drew nearly 9,000 registered attendees over the course of the three-day event, with most of those attendees participating on multiple days. The MARPA booth saw significant traffic, and we took the opportunity to speak to as many attendees as possible, explain who we are and what we do, as well as the benefits of U.S. FAA-PMA, and discuss the businesses of our members. Several attendees asked for more information about the particulars of our members’ businesses in hopes of developing relationships.
MARPA hopes that our members will be able to participate with us–or provide us with promotional materials–in future years in Japan, because there is strong interest from the Japanese manufacturing community in developing U.S. relationships. As we explained in our panel presentation, the opportunities provided by partnering with high-quality manufacturers that are able to offer product lines that complement your current offerings can greatly expand your business opportunities, because customers often prefer suppliers that can meet as many of their needs as possible all in one place.
MARPA also took advantage of its presence in Japan to meet with a number of air carriers to promote the values and benefits of PMA. We were happy to find these operators are already familiar with PMA and use PMA in their fleets. However, as with all carriers, there is still significant room for growth. MARPA took the opportunity to explain how PMA parts provide great value and savings by solving reliability issues, quality issues, and sourcing issues, as well as offering the obvious benefit of reduced cost off the shelf.
The positive reception toward our discussion of PMA leads MARPA to believe there is still a lot of opportunity for sales expansion in the Japanese market.
There will be several representatives from Japanese carriers and suppliers at the MARPA Annual Conference in Las Vegas next week (October 28-29). The conference will be a great opportunity to network with existing and future customers as well as discuss potential relationships with Japanese suppliers. We look forward to seeing new business connections made!
A new proposed tasking from the FAA’s Aviation Rulemaking Advisory Committee (ARAC) on rotorcraft occupant protection may provide great opportunities for manufacturers of certain rotorcraft parts. The proposed task seeks recommendations on how current occupant protection standards should be made effective for newly manufactured rotorcraft, with a follow-up task asking how to incorporate such protection standards into the existing rotorcraft fleet.
Increasing safety is always the FAA’s number one concern. Over the past several decades, the FAA and industry have made a focused effort directed at reducing rotorcraft accidents in general, under the theory that a reduction in total accidents would result in a corresponding decrease in serious and fatal accidents. However, a recent study has indicated that while the total number of accidents has decreased, the number of fatal accidents has not followed a similar downward path.
A major contributing factor to this trend (or lack thereof) has been a slow incorporation of occupant protection mandates into the overall rotorcraft fleet. Specifically, crash resistant fuel system requirements and requirements related to blunt force trauma protection and dynamic seating, which have been in effect for more than twenty years, have been incorporated into only 16% and 10% of the U.S. fleet, respectively.
Why have these safety standards been so slow in spreading through the U.S. rotorcraft fleet? The answer is that retroactive laws and regulations are generally frowned upon in our legal system. Typically, unless Congress specifically authorizes retroactivity, new regulations can only be prospective in nature. The real world effect of this requirement means that the regulations to which a rotorcraft (or aircraft) must adhere are those that were in effect at the time the type design was approved (unless an AD or similar is issued). In other words, the type design doesn’t have to be continuously updated to keep up with changing regulations.
Even though the regulations relating to crash resistant fuel systems and dynamic seating were issued more than twenty years ago, most of the rotorcraft being manufactured today are being manufactured under type designs that are even older still. This means that the safety benefits of the crash resistant fuel systems and dynamic seating are not being incorporated in a large part of the fleet.
Recognizing this impediment, the FAA and NTSB both recently recommended implementing a rule that would require crash resistant fuel systems to be installed in newly manufactured rotorcraft (the key wording being newly manufactured rather than newly certificated). This would make the rule retroactive with respect to the production of new rotorcraft, even if the TC of the rotorcraft was issued prior to the applicable crash resistant fuel system and dynamic seat regulations taking effect.
The working group that considers the proposed tasking will take these issues, and others, into consideration and make recommendations on how these protective standards can be made effective for newly manufactured rotorcraft, regardless of certification date. The follow-on task would then consider the incorporation of safety improvements into the existing fleet. This amounts to a significant number of rotorcraft that will be produced and/or retrofit with new equipment.
The recommendations presented by the working group will go a long way toward shaping the way in which the safety standards are implemented. In the past, these efforts have resulted in OEMs writing rules that effectively gave them a monopoly in the implementation of the safety solution. If your company manufacturers parts for rotorcraft, this could be a great opportunity to get involved with the working group and help shape the implementation of the safety standards going forward—allowing for the use of PMA and other non-OEM solutions that will drive price competition and improve safety.
Does your company manufacturer rotorcraft parts? Is this an issue MARPA should actively engage in? Let us know! We encourage our members who have an interest in this issue to contact the FAA ARAC and get involved.
One of our members recently reported that his company has been offering cabin interior PMA parts to several Chinese airlines, only to be told that they are already using CAAC PMAs for many of these cabin parts. CAAC PMAs are Parts Manufacturer Approvals issued by the Civil Aviation Authority of China. CAAC PMAs are acceptable for installation on Chinese-registered and Hong Kong-registered aircraft but they do not appear to be currently acceptable for installation on any other aircraft.
Our member asked whether there is a master list of CAAC PMA parts that MARPA members could review. This would help MARPA members know which parts have not been PMAed in China which in turn will help to reveal which FAA-PMA parts might be most valuable and useful to Chinese air carriers.
As far as we know, the master list of CAAC PMAs is only maintained as an advisory circular. Because it is an advisory circular, it is not maintained in real time, but rather it is updated annually. This link is to the 2015 revision of the CAAC PMA Catalog.
Hong Kong has a separate aviation authority. Hong Kong’s Civil Aviation Department also issues its own PMAs. Hong Kong has issued PMA authority to Taikoo (Xiamen) Aircraft Engineering Co. Ltd. There is a Schedule of Implementation Procedures between China and Hong Kong under which each accepts the PMAs of the other.
ACCEPTANCE OF CHINESE PMAs
Remember, the current US-China bilateral permits entry of US PMAs into China, but it is currently a one way only: it does not permit installation of Chinese PMAs onto US-registered aircraft. Without an explicit acceptance of CAAC PMAs through a US document (such as the US-Chinese bilateral agreement), CAAC PMAs are not currently eligible for installation on US registered aircraft as replacement or modification parts (under 14 C.F.R. 21.9).
FAA PMA FOR CHINESE MANUFACTURERS
There is a mechanism for Chinese companies to obtain US PMA. Chinese companies wishing to set up final production sites in the US could apply for US PMA and could use that as a mechanism to create FAA-PMA parts that are accepted all over the world. For many Chinese companies, the most efficient and effective way to accomplish this would be to partner with an existing FAA-PMA holder in the United States that has experience navigating the FAA regulatory system.
MARPA and the Korean Trade Promotion Agency (KOTRA) delivered a PMA workshop in Seoul this week. Hosted at KOTRA Headquarters in Seoul, the workshop provided an opportunity to begin educating the Korean aerospace community about the value of FAA-PMA parts. It also afforded the PMA community an opportunity to begin strengthening business relationships with the Korean aerospace industry.
MARPA’s President, Jason Dickstein, spent the first day of the workshop laying the goudnwork for understaing the PMA process.
The room was packed with about 60 participants from all sectors of the Korean aeroaspace community. MARPA discussed issues like the parts approval process, the safety, reliability and economic advantages afforded by FAA-PMA, and strategies for partnering with US PMA companies in order to increase trade and increase the profis of both companies.
Three of our members attended the workshop. Representatives from Heico, Jet Parts Engineering, and the Wencor Group joined us at the workshop and had an opportunity to network with potential suppliers from Korea’s manufacturing community as well as potential customers from MROs and airlines.
We were honored to be joined by Ha Girl Chung, the Deputy Director of Aircraft Certification for Korea’s Ministry of Land, Infastructure and Transportation. Mr. Chung was a key negotiator in the recently updated technical implementation procedures for the US-Korean bilateral aviation safety agreement. He reviewed the elements of Korean law that permit the acceptance of US PMA parts in Korea, and he also explained Korea’s own ability to issue PMA for parts made in Korea.
Privately, Mr. Chung told MARPA that Korea would like to begin issuing domestic PMA. This was foreshadowed by last years update to the US-Korean technical implementation procedures, which left a specific reservation (a place holder) for US acceptance of Korean PMA parts.
Asiana and Korean Air Lines were both well-represented at the event. Hoon Yong Kim, from Korean Air, delivered a presentation about his air carrier’s PMA policy. He explained that his carrier does not currently use critical PMA parts, but that they would like to expand their current use of non-critical PMA (critical PMAs are less than 1% of all PMAs). Mr.Kim said that they are particularly targeting interiors parts, right now, but they would like to increase both the quantity and the scope of the PMAs that they use.
What specific qualities does Korean Air seek? Mr. Kim explained that parts partners need to hold FAA PMA (other nations’ systems are currently not on his radar) and they should be prepared to support Korean Air in cooperative analysis. He described one situation where a supplier helped Korean Air perform a root cause analysis. Despite the fact that the root cause was unrelated to the supplier, the supplier provided continued engineering support. During subsequent conversations, Mr. Kim confirmed that he is looking for companies that have established systems like MARPA’s Continued Operational Support (COS) program.
All three of the MARPA members who were on hand had an opportunity to meet and speak with the attendees. Steve Johnson from Jet Parts Engineering added some insightful questions to the workshop. Joe DePaoli of Heico explained that his company and his peers from other PMA companies were interested in opportunities to work with Korean manufacturing companies with specialized technologies, and also with Korean manufacturing companies that are already making certain types of parts and who could use those skills to manufacture parts that could be approved under FAA-PMA.
Mark Powell of the Wencor Group delivered the anchor presentation at the end of the workshop, and he summarized the process that helped to ensure that PMA parts met the highest standards.
KOTRA and MARPA have begun a partnership to promote US-Korean aerospace trade with a focus around PMA parts. MARPA members should expect – and should look forward to – future oppotunities to increase their trade with Korean businesses.
FAA will conduct a 3-day Parts Manufacturer Approval (PMA), Commercial Parts, and Standard Parts course at the Singapore Aviation Academy, September 28-30, 2015.
The course will be taught by FAA’s expert Robert Sprayberry. The course is a top-level study of the FAA’s approval/acceptance of articles (i.e. PMA process, commercial parts, and standard parts). It will provide instruction on relevant regulations and historical findings as well as include examples and descriptions from industry and FAA perspectives. The class will focus on analysis of relevant advisory circulars and orders. Additionally this course will provide an overview of the history of the 14 CFR 12.8 and 12.9 for context.
There is still time to register for this course; registration deadline is August 31. For more information contact Diane Migliori @ 202 267-1029 or via email, firstname.lastname@example.org.
The FAA has released for comment two guidance documents pertaining to Instructions for Continued Airworthiness (ICA): Draft FAA Order 8110.54B and Draft Advisory Circular 20-ICA. As many readers of the blog know, MARPA has done, and continues to do, a significant amount of work to ensure that ICA are available and accurate in accordance with the Federal Aviation Regulations.
Draft Order 8110.54B is guidance directed at FAA personnel and persons responsible for administering the requirements for ICA. Among other changes, the draft reorganizes the Order to reflect material moved to AC 20-ICA (below), and importantly incorporates guidance implementing the FAA’s Policy Statement PS-AIR-21.50.01, Type Design Approval Holder Inappropriate Restrictions on the Use and Availability of Instructions for Continued Airworthiness. MARPA and the PMA industry were closely involved with, and supportive of the FAA in, the adoption that Policy Statement intended to protect the industry from anti-competitive ICA restrictions.
Draft AC 20-ICA is a new Advisory Circular that removes industry-specific guidance from the internal FAA Order and places it in a stand-alone AC. This effort is similar to the FAA’s actions in revising Order 8110.42D – Parts Manufacturer Approval Procedures and developing the new AC 21.303-4 – Application For Parts Manufacturer Approval Via Tests and Computations Or Identicality. Like Draft Order 8110.54B, the draft AC implements the FAA policy on ICA established in the Policy Statement. The proposed AC provides guidance to design approval holders (DAH) and design approval applicants for developing and distributing ICA.
After a preliminary review these documents appear to offer very positive guidance for the PMA and aviation maintenance industries, and appear in line with the policy positions for which MARPA has advocated for many years. MARPA will be reviewing both of these documents closely and offering comments and support for these policies to the FAA. We encourage the PMA industry to review both documents as well.
Comments on both guidance documents must be submitted by October 6, 2015, and may be submitted to the FAA via email to 9-AVS-ICA@faa.gov. If you have comments or observations that you feel MARPA should include in its comments to the FAA, email them to Ryan Aggergaard at email@example.com so the we can include them.
We will be discussing issues that affect Korean-US business relationships and strategies for increased Korean-US trade. MARPA members will be networking with existing and potential Korean business partners.
We should be able to secure complimentary registration for any MARPA member who wants to attend. If you have personnel in the Republic of Korea or elsewhere in northern Asia, then you should certainly have them on site for this meeting.
If you have personnel that you would like to register for the workshop, please let MARPA know ASAP as time is running short.
The purpose of this trade mission is to introduce air carriers and MROs in Southeast Asia and China to the concept of PMA, and to the significant advantages that they can recognize by doing business with PMA manufacturers from the United States. We hope that this will help increase PMA sales into these regions.
The mission will begin for MARPA at MRO Asia in Singapore, November 3 through 5. We are planning to set up a few pre-scheduled meetings as well as allowing members to interact with the MRO attendees. After MRO, we will fly to Hong Kong to meet with air carriers on Friday. We plan to transfer to Guangzhou over the weekend in order to meet with Gameco and China Southern on Monday. Then we will spend Tuesday-Wednesday in Shanghai and Thursday-Friday in Beijing meeting with air carrier and MRO sales targets.
If you aren’t yet selling into Asia, then this is a wonderful way to start meeting potential customers. If you already have business in Singapore, China and Hong Kong, then you won’t want to miss this exceptional opportunity to renew acquaintances and build more business.
MARPA has been planning this 2015 trade mission since late 2014, and we’ve enjoyed incredible support from our US government contacts. This trade mission is undertaken in partnership with the US Department of Commerce, and we are being assisted by the International Trade Administration and the Commercial Foreign Service officers in the embassies and consulate offices. This is a valuable membership benefit that is available to help MARPA members increase their export business so make sure you take advantage of it!
If you are interested in participating or want more information, then please contact the Association. We’d love to hear from you.
We hope to soon be able to offer a specific itinerary and price for the mission. Once this is announced, we will take firm commitments from members on a first-come-first-served basis until the program is full.
Wondering if you can sell PMA parts into China? Tomorrow we will start addressing the legal standards for PMA acceptance in China!
The MARPA Air Carrier Committee, led by Michael Rennick, Delta Air Lines Component Engineering Manager, is hard at work supporting PMA users and MARPA members. In June, members of the MARPA Air Carrier Committee, including Air Wisconsin, American Airlines, Republic Airways, US Airways, Air Canada, and Delta Air Lines, submitted to the FAA a letter seeking clarification on the issue of PMA parts that are alternates to post modification Airworthiness Directive (AD) related parts.
This clarification is necessary because confusion has sometimes arisen between operators and local regulators over the need for an Alternative Method of Compliance (AMoC) for post-modification AD-related PMA parts. It is the position of the MARPA Air Carrier Committee that if the PMA is an alternate to an OEM part contained in a post-AD configuration, no such AMoC is required.
When a PMA is issued for a replacement part for a post-modification AD-related OEM part, it is uncommon for the PMA applicant to request an AMoC to the AD, or for the FAA to note the AD on the PMA approval. This makes some sense because a post-AD PMA part is inherently an alternative method of compliance without being described as one. However, an issue arises because many ADs call out only the modified OEM part as a means of compliance. Because ADs are technically regulations under Part 39, alternate approvals such as PMAs might not satisfy the regulatory requirement and so an AMoC may be required.
It would be beneficial to both operators and PMA manufacturers to see this change.
The OEM part is the source of the condition giving rise to the AD. The post-modification part must resolve the condition in order to satisfy the AD. During the PMA approval process for the same part, the AD is also taken into consideration.. In order to receive PMA approval, the subject PMA part must resolve the condition resulting in the AD, just as the post-modification OEM part does. There should be no need to call out an AMoC for the PMA part related to the AD; the underlying condition that necessitated the AD has changed because the approved PMA part has replaced the post-AD OEM part. The PMA should be a valid terminating action for the AD.
There are limited circumstances in which this reasoning may not apply, but these limited circumstances are not the subject upon which the Air Carrier Committee seeks clarification. For instance an AMoC may be necessary in a scenario in which an AD applies to a higher level component or assembly. In this scenario the PMA replacement for the OEM part may not address the AD for the higher assembly because it is a replacement at the piece-part level, and thus an AMoC may be necessary for the higher assembly.
Generally, however, an AMoC should be inherent in an approved PMA part and therefore unnecessary as a separate approval. This is the policy clarification that the Air Carrier Committee seeks in the form of a formal FAA communication. If an approved PMA part is a replacement for a post-AD OEM part, the FAA’s policy should clearly state that the approved PMA is a terminating action for the AD and that no additional approval or discrete AMoC is required. In the alternative, an AMoC could automatically issue for each post-AD PMA to show compliance.
MARPA greatly appreciates the Air Carrier Committee’s work on this project. MARPA will be working with the FAA and the Committee to determine whether future ADs will list an approved PMA as a valid terminating action, or whether an automatic AMoC should automatically issue with a PMA to show compliance to the AD, or some other solution is desired. We will keep our members apprised of these developments.
If you are a MARPA member air carrier and want to get involved with the Air Carrier Committee, please email Katt Brigham at firstname.lastname@example.org. If you are not yet a MARPA member but would like to get involved, visit our membership application page. MARPA membership is free for air carriers!
Edited to clarify that ADs are regulations and identify possible solutions to the issue raised in the Air Carrier Committee’s letter.