Business aviation’s supply chain has been creaking noticeably since the start of the COVID-19 pandemic, but is the tension now loosening up? Views in Geneva at the annual trade show EBACE differed.
Jetnet’s iQ survey [PDF] released just in time for EBACE highlights that airframers are “dependent as always on fully-functioning supply chains” and working on “eliminating chokepoints, which have been the name-of-the-game since 2020 and The Big Shutdown”.
The supply chain is still a risk, though: the 2024 iQ survey shows European industry is preoccupied with the supply chain as the primary challenge facing the industry (28 percent of responses) while the North American industry considers it the second biggest challenge (20 percent) after attracting and retaining talent to the industry (25 percent). These problems are, however, intrinsically linked: as talent moves within the industry, often up the value and supply chains, the source of that talent has to expend time, money and inefficiency in the interim to replace their expertise.
GAMA, the General Aviation Manufacturers Association, predicts a business jet delivery increase of 13 percent, with turboprops also seeing substantial interest. There are, however, certain key areas where supply chains are still an issue, with semiconductor chips, plastics, raw materials and especially metals a complicated situation.
Those manufacturers heavily reliant on titanium as part of their aircraft in particular face issues with sanctions on Russian production of the metal, with Bombardier securing a waiver from Canadian restrictions in April not on its own account, but on the account of some elements within the supply chain. Airbus, which both builds aircraft (the A220, formerly Bombardier’s C Series, in its Airbus Corporate Jet form in this context) and has parts of its supply chain in Canada, also secured a waiver.
Geopolitics is also affecting shipping times for aviation’s supply chain, particularly between Asia-Pacific and Europe as a result of instability and attacks on Red Sea shipping using the Suez Canal. For an industry where much of the supply chain was designed on a just-in-time basis, this creates complications.
These shipping time issues naturally affect OEMs (original equipment manufacturers), who incur higher costs in transportation and need to increase their local stocks of parts, but maintenance, repair and overhaul (MRO) operators are also badly hit, affecting MRO activities in general and redeliveries in particular.
Looming on the horizon is another supply problem: that of sustainable aviation fuel (SAF). With private aviation coming in for much criticism on environmental grounds, the need for the industry to be at the forefront of SAF initiatives is vital, even while it can also serve as an aviation testbed for new technologies and types of propulsion.
Speaking at EBACE, World Fuel Services Europe’s sustainable fuels advisor Tom Cahill says that “we are starting to see a significant uptick in demand – not just in Europe – but globally. And that’s being matched by a significant increase in supply, as well.”
The problem is that increase is from something of a standing start. Europe’s ReFuelEU Aviation Initiative and its 2 percent SAF mandate in 2025, then 6 percent in 2030 and finally 70 percent by 2050, sends a clear signal.
Hendrik Stannius, SAF supply operator at Air bp, explains that “it effectively says, we want this much SAF in the market and we want it, whatever the cost, and we want it to increase until 2050. So that’s a very, very strong investment signal which is challenging, but highly welcome.”
Aligning this mandate with others in the regulatory pipeline will be critical to ensuring an adequate future supply.
Author: John Walton
Published: 10th October 2024
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