When it comes to replacement parts, the large OEMs would prefer to have a monopoly on the aftermarket business. But as with any industry, the presence of alternative aftermarket products of comparable, or even better, quality drives down prices. For the aviation industry, this competition comes from smaller independent MROs as well as PMA parts manufacturers.
August 24, 2016 By R&D Dynamics
In response, OEMs attempt to retain as much of the aftermarket as possible by marketing its parts as the highest quality, most reliable parts available, through warranty and contracts with air carriers and leasing companies, and now through new bundling strategies designed to lock out alternative suppliers.
According to Tom Wolfe of FAA-certified MRO component repair facility AeroKool Aviation – a company that specializes in environmental control systems, air cycle machines, valves and heat exchangers – the OEMs have a vested interest in discouraging the use of third party repair stations and PMA part providers.
“The OEMs invest heavily in product development on the front end and hope to recoup some of that investment in aftermarket programs,” says Wolfe.
Techniques designed to keep the repair and part replacement business in-house include contractual agreements that specify the use of OEM replacement parts only.
OEMs may also employ repair “bundling” strategies for complete packages of repair for entire systems – and even other parts of the aircraft – under a single, blended rate. This makes it difficult for the air carrier to get information on individual part costs to evaluate if switching to a PMA part might be advantageous.
“The aviation industry benefits from the competition, which drives down prices for the airlines,” says Wolfe. “There is no competition when the OEM is the only option in the market.”
That being the case, PMA parts are still at a disadvantage when compared to OEM parts – not because of price or quality, but rather a lack of education about alternate options.
Parts Manufacturer Approval (PMA) is an authorization granted by the Federal Aviation Administration (FAA) to a manufacturer of aircraft parts. PMA parts must pass the same rigorous quality and testing requirements as OEM parts, but are often significantly lower in price.
The perception and adoption of PMA parts can vary based on geography, the category of customer (air carrier, leasing company, parts broker, independent MRO), and in some cases, simply the familiarity and confidence of the customer with the quality of these alternatives.
In North America, the majority of air carriers already accept PMA parts. However, in Europe, Asia and developing countries there remains a perception that OEM parts are higher quality and more reliable.
“There is a perception in some parts of the world, which I believe is changing, that PMA parts may be inferior in quality and design robustness to OEM parts, but as has been proven many times, PMA parts meet the requirement of being equal to, or better, than the OEM,” says John Grimshaw of Triumph Accessory Services, Wellington, a Part 145 Repair Station.
As for other segments of the industry, aircraft leasing companies largely continue to specify in lease agreements that only OEM replacement parts may be used. For parts brokers and distributors, the decision to use OEM or PMA parts is often driven by the customer so they offer both options.
According to Grimshaw, independent MROs tend to specialize in specific components or sub-systems within the aircraft. For Triumph Accessory Services that means electrical generators, hydraulic pumps, pneumatic valves, air cycle machines, various types of actuators, and power generation and transmission equipment.
The bulk of the work comes from air carriers that no longer perform in-house repairs, from parts brokers and distributors that need components tested, repaired and overhauled to resell, and from freight carriers converting passenger aircraft.
OEM repair shops, on the other hand, can offer a broader portfolio of parts. In addition, they can offer air carriers parts at below-catalogue rates, while the MRO often must pay full price.
Therefore, to compete effectively, third party repair shops often promote the use of PMA parts.
Rich Simmons, Operations Manager at Texas Pneumatic Systems (TPS), a third party MRO that specializes in pneumatic, fuel and hydraulic components, concurs.
“If a customer is looking for a cost effective solution, we want to be able to offer them the PMA parts because they are less expensive than the OEM,” says Simmons. “For our service, we would be remiss if we didn’t offer that.”
Environmental control systems
A prime example of the push-pull between OEM and PMA provider can be found in the maintenance and repair of Environmental Control Systems used in most military and commercial aircraft.
Environmental Control Systems (ECS) provide air supply, cooling & heating and cabin pressurization for the crew and passengers. Major OEMs such as Honeywell, United Technologies Corporation Aerospace Systems (UTAS), and Liebherr dominate the market.
A key component in these systems is the Air Cycle Machine (ACM). To produce cool air without the uses of a refrigerant, such as Freon, this high speed rotating machine utilizes sophisticated foil air bearings that conform to the shape of a mating rotating shaft. Most commercial and military aircraft today utilize ACMs with this type of bearing.
However, at 30,000 to 45,000 rpms even well-manufactured foil bearings can fail or wear out from constant use over time. When this occurs, the ACM may fail to operate in-flight. More serious failures or imbalances of the rotating elements can also cause ancillary damage to other components in the air conditioning pack.
Although common, less-sophisticated PMA parts may be available from many sources, some – like foil-air bearings – may only be available from a few. Finding a qualified PMA provider is not difficult. Sources include the FAA’s web site, Inventory Locator Service (ILS), trade shows and even through the company’s own advertising and marketing efforts.
Among those currently listed is R&D Dynamics (rddynamics.com), a producer and supplier of high quality, FAA approved foil air/gas bearings and other PMA parts for most models of ACMs.
At its facility in Bloomfield, Connecticut, each foil air bearing is developed using exacting design and manufacturing processes that are similar to OEM methods and inspected prior to shipment using stringent FAA quality inspection systems.
Any concerns over the quality of these sophisticated PMA parts quickly vanish when engineering personnel learn more about the company. Established in 1990, the company’s founder, Dr. Giri Agrawal, pioneered the design and development of high speed rotating machines supported on foil air/gas bearings for air cycle machines in the 70’s and 80’s while working at Honeywell and Hamilton Sundstrand.
“One of the benefits that R&D Dynamics has is that the founder was a key driver in the development of foil-air bearing technology,” says Wolfe of AeroKool Aviation. “When Hamilton-Sundstrand first developed it, he was the leader of the team of engineers that developed this technology.”
As Chief Project Engineer at Hamilton Sundstrand, Agrawal received the “George Mead Medal”, the highest technical award from the parent company United Technologies Corporation. He was also cited as the “Father” of the Hamilton Sundstrand Air Bearing Program.
“When you are looking at PMA parts and your looking at options at how you can be more competitive with the OEMs, when you see that type of pedigree and credentials, you understand that this company is different form other PMA companies,” adds Wolfe.
However, Texas Pneumatic Systems’ Simmons is quick to add that the reputation of the PMA provider only gets the company’s foot in the door.
Although he was also impressed with Agrawal’s background, he says that what ultimately keeps the customer engaged over time boils down to quality and price. It is for these reasons that Texas Pneumatic Systems has purchased foil air bearings from R&D Dynamics for the past 15 years.
“Reputation gets us moving, but reputation won’t keep us a customer,” explains Simmons. “The proof is still in the pudding; when we use the product, do we get the life out if that we get out of the OEM part? Do we have more or less warranty returns?”
In addition to providing a high quality part, working with smaller PMA suppliers instead of large OEMs can have other advantages as well. Because of their focused expertise, many of these companies can offer OEM-level technical support and are agile and small enough to respond quickly to any situations that arise. This includes expediting delivery of parts when necessary.
“With a PMA parts manufacturer like R&D, there is a willingness to make adjustments in the supply chain, the delivery schedule or if there is a hiccup of any kind, they are able to jump right on to it and get the fix completed with the main guys making the decisions,” says Grimshaw of Triumph Accessory Services, Wellington.
“You don’t have huge conglomerate and multi-layered management where things are slow to get done, with an agile PMA manufacturer it can get done overnight,” he adds.