What’s gonna hit the airlines next

As  if we needed to be told, things are changing and the outlook is bleak.

But bleak like what?

Thales, which held a big party to launch its new RealitySeven flight simulator range and announce its re-entry into the provision of training support services on 19 February, gathered a massive breadth of global air transport expertise at its huge new plant in Crawley, near London Gatwick airport.

While I was there, here are a few little gems I picked up from various industry sources. They are paraphrased for brevity, but very close to the original quote:

From a very senior executive in one of the world’s major aircraft manufacturing organisations: “No, the major airlines don’t do their engineering any longer, they just think they do. Very little goes wrong with modern aircraft, and when it does they expect the OEM [original equipment manufacturer) to do the work. This is going to have to stop, and soon.”

Will the manufacturer just stop doing the work? “No, we’ll do it, but we’ll charge for it.”

The same exec predicts a significant move by major carriers away from doing all their own maintenance to outsourcing much of it to MRO providers. But the MROs are relying on the OEMs just like the airlines, says the exec, so things are going to have to change there too.

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Now from senior execs in two world-leading flight training organisations (FTO) that both offer everything from ab-initio pilot training to airline type ratings: “There may be plenty of pilots available right now, but as soon as the economic turnaround comes the training industry will not be able to support demand.”

There is a fundamental disagreement here between the FTOs’ assessment of pilot supply and the major carriers’ experience. The latter all said at Thales’ party: “Whenever we advertise for applicants we get more – in multiples – than we need.”

But they are showing the early signs of doubt about whether that situation can continue forever. One major is considering doing a deal with regionals about seeing pilots through training, then flying in regional short haul and finally joining its own long haul.

Meanwhile at the event, Thales announced its support for customers to help them set up an entire training organisation if that’s what they want, not just to provide the simulation.

This seems to be part of a trend among FTOs and training system providers: today (not at the Thales event) UK FTO CTE announced it has gone into contract pilot supply. In the last year or so Oxford Aviation Academy acquired Parc so that it could do the same.

Are future airlines going to employ pilots or train them any more, or just contract them seasonally as required?

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Still at Thales: What is the priority for airlines today? “To be ready for the upturn.” What does that mean in terms of preparation? “Surviving the downturn.” But I asked about preparation? “It’ll be alright on the night.”

One Response to What’s gonna hit the airlines next

  1. Luke W 22 April, 2009 at 11:46 am #

    Hi David – thanks for the interesting article.

    I was particularly interested in the OEM Manager’s view on airlines having to pay for OEM services in the future. Did the manager in question mention how this might be tied up in whole-of-airframe power-by-the-hour contracts (like Goldcare)?

    Perhaps there are some parallels with an article from Airline Business in 2005 (http://www.flightglobal.com/articles/2005/09/26/201685/maintenance-turning-the-screw.html). It talks about how airlines are outsourcing much of the fleet technical management to a new breed of “intelligent suppliers”.

    Any comments or views?