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How The Airlines Can Cut Their Overall Operational Repair Costs (Essay Sample)


the task involves analyzing the costs in the aviation industry. each of these costs have to be evaluated and provide possible means to reduce the overall operation costs in the aviation sector. the sample paper clearly presents these costs, identifies the critical ones and how the airlines can reduce their overall operational costs. the advantages of this reduction to the industry is also presented.

Cutting Aviation Repair Costs Student Name Institution Cutting Aviation Repair Costs The aviation industry is an economic driver for most countries. It complements other sectors like trade and tourism. Being a major driver of many economic fronts, countries have to ensure healthy running of their national and private carriers CITATION Qui14 \l 1033 (Quinlan, 2014). The airline industry is quite volatile and should be handled with care. Otherwise, other economic sectors would be greatly affected. Poor management of airlines could pose a security threat to people and the goods transported. Aircrafts have to be accorded maintenance in between flights. However, large number of repairs and the human resource involved could increase the costs. Increased costs reduces the profit margins of the airlines. One cost-cutting approach employed by most airlines is the use of third parties to provide maintenance services CITATION The14 \l 1033 (Thenent, 2014). Usually, airlines will hire foreign workers and even facilities to provide maintenance services for the given airline. Such outsourcing has its disadvantages, and should not be encouraged throughout our country. The paper will focus on why commercial airlines should desists from using foreign and/or underdeveloped countries to cut repair costs in aviation. The hired expatriates usually work on a temporal basis on the given maintenance project. The repair work covers several sections of the aircraft system, from the servicing of the engines to the performance of a D-check on the whole fleet owned by the airline. A D-check is regarded as the heavy maintenance check and is usually carried out after four or five years CITATION RCu15 \l 1033 (Curran, 2015). Several companies offer maintenance services to airlines on contract basis. Examples of such companies include Duncan Aviation Inc., A & P Technicians, and IA Aircraft Inspectors CITATION RCu15 \l 1033 (Curran, 2015). Their services are widely known, and airlines bring in their planes or whole fleet for maintenance services. There is an increasing tendency to outsource the maintenance duties to third parties. Some of the reasons attributed to this shift include the high costs of the equipment and spare parts for the airlines, and the scarcity of qualified human resource to handle these tasks. There are few qualified technicians who can carry the D-check on the airline fleet. A technician able to perform such check is considered a novice in this field, and that skill is scarce to serve the whole industry if it were on permanent employment terms. Instead, airlines are finding it much cheaper to share such qualified human resource to perform the maintenance services, while they focus solely on managing the airline CITATION Dam \l 1033 (Damacoc, 2017). Inherently, the qualified technicians come from foreign countries like China, Russia and even Europe. This necessitates the outsourcing of such tenders to these companies to get the best repair services available. The high cost of the equipment and spare parts makes some airlines to shelve such costs to the contractor. Usually, the investment in spare parts for each plane is about fifteen percent of the plane’s purchase price CITATION RCu15 \l 1033 (Curran, 2015). With such a fraction, no company would be willing to stake such investment on their planes. Instead, they would utilize the just-in-time approach, where the spare parts would be made available whenever the airline is in need. The disadvantages of outsourcing is the liability to poor quality services and/or spare parts. Some spare parts might be fraudulent, and would fail during service. It is better to have an expensive quality spare part to last two years than a cheap one lasting probably less than a year. Even when delegating the duties, the airline may not have all the details of the repairs done, their quality and even place of manufacture. The third parties use this to their advantage to increase the profit margins. FAA has laid out the criteria to verify the quality and authenticity of the spare parts CITATION Qui14 \l 1033 (Quinlan, 2014). Another issue regarding outsourcing is the security of the airplane and data transmitted on that plane. Usually, the outsourced professionals scan through the avionics, and would unearth trade secrets CITATION Dam \l 1033 (Damacoc, 2017). These trade secrets have a way to reduce the revenue generation if released to the wrong audience. Therefore, the airlines have to be careful as to which information is accessible to the third parties ...
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