While the immense importance of spare parts to the aviation industry suggests that this MRO segment should be one of the most advanced, some of the processes related to the procurement of aircraft spares and components are still largely underdeveloped and conducted manually. However, Locatory.com is here to change all that. Meet Amber A.I., a one of a kind Artificial Intelligence-based tool for aircraft parts procurement and logistics management in the aviation MRO market. Capable of recognizing part numbers, quantities and condition as well as producing automatic inventory availability reports and sending out RFQs in just few clicks, it will significantly facilitate your search processes, all via a simple e-mail.

Are you familiar with that feeling of frustration, when you have to make dozens of manual assessments and multiple copy & paste actions while searching for aircraft spares if your preferred suppliers can’t deliver? Well, forget about all that, because from now on, with the brand new IT solution from Locatory.com you can gain instant access to thousands of spare parts in one click and send multiple RFQs to all suitable suppliers in another. The new tool’s name is Amber and it acts as an artificial intelligence-based spare parts procurement assistant who understands human language.

Amber A.I. is fully capable of recognizing e-mails and identifying any amount of part numbers, their quantities and condition (currently, the system offers 99.09 % part recognition rate)

Amber A.I. is fully capable of recognizing e-mails and identifying any amount of part numbers, their quantities and condition (currently, the system offers 99.09 % part recognition rate), so using it is amazingly easy: you send or forward an e-mail, receive a report, and click reply. After receiving your e-mail, Amber A.I. automatically sends a request to the Locatory.com marketplace for parts availability. The issued report contains information from hundreds of suitable vendors, including parts availability, quantity, condition, location and supplier’s details. After that, a simple reply to that e-mail will send RFQs to all of the vendors that have the parts you need. The whole process takes less than a minute! As a result, anyone anywhere in the world can now easily find aircraft spares and send RFQs in just a few clicks.

“Every day aviation procurement managers are faced with various unexpected aircraft maintenance and repairproblems costing sky-high sums of money. But when there’s no possibility to get the part from a trusted supplier, they get into a searching spree and encounter painful headaches. With this in mind, it is hard to believe that the search for spares and components still largely relies on old-school procedures, mostly involving countless phone calls and time-consuming correspondence or using systems that are shockingly out-of-date,” says Zilvinas Sadauskas, the CEO of Locatory.com. “But at the same time, aviation is quite an inert industry, and while technology does have the potential to offer new, more efficient strategies to accomplish old tasks, it can be really difficult to introduce something new. So the question is how to make a change without forcing people to change their habits? And we believe we have found that answer.”

The technology of Amber A.I. is aimed at simplifying the most repetitive spare parts search and procurement procedures by focusing on the existing industry habits, rather than building a new platform. This is why the use of the product heavily relies on e-mail, which is the predominant means of communication in the spare parts trade. Moreover, since e-mail is the most popular business communication tool on a smartphone, Amber A.I. supports any devices, including computers, mobile phones and tablets. All you have to do is make sure that your device is connected to the internet and you can send an e-mail.

“The mobile devices in our pockets are already the most important gadgets for the majority of us: there are more people across the globe who own a mobile phone than those who own a toothbrush. Moreover, today people expect customer support whenever and wherever they need and want it. So we have made all that the core component of our new product: not only is Amber A.I. available on any device (as long as it can send an e-mail), but it also doesn’t require any logins or passwords, as all of our clients are added onto its database. Therefore, Amber A.I. is highly portable and accessible,” shares Zilvinas Sadauskas.

“It’s actually as simple as it sounds. You conduct ordinary actions: write an e-mail, containing the relevant information or forward a request. Moreover, the e-mail doesn’t have to be written specifically for Amber A.I.: you can add Amber A.I. in a copy of your ordinary e-mail to any of your suppliers, and it will automatically extend your search with the capabilities of Locatory.com marketplace. Therefore, we have already done the complicated stuff for you! Well, actually, you still have to do one thing – join Locatory.com. But who hasn’t already?” smiles the CEO of Locatory.com.

Amber is named after the fossilized resin from ancient forests, which symbolizes Lithuania – the country of its origin – and is readily available from now on.

Each year the aviation industry spends a whopping amount of money on MRO, second only to that spent on fuel. It is a $68 billion industry, which, according to TeamSAI, is going to reach $86.8b in ten years’ time. Therefore, making investments in technology that enables higher automation of maintenance, repair and overhaul processes would seem to be a sound business decision. However, while many airlines are already benefiting from the integration of various mobile-based IT solutions, the possibilities of improving the time costly processes of the aftermarket support are still to be discovered.

The global adoption of mobile technology has soared in the last decade. According to various data, 91% of all people on earth have a mobile phone, with 38% of 2-year olds using mobile devices. Moreover, the overall shipments of smartphones are forecasted to grow at a compound annual growth rate of 25.9 percent throughout 2015. This massive shift in mobile adoption has turned a mobile phone into a critical platform for developing new services and content that improves interaction and facilitates operations. Therefore, no wonder that such a highly competitive industry as aviation has already started to successfully adopt some of the features the technology offers.

A recent SITA’s Airline Business IT Trends Survey has revealed that a staggering 93% of all airlines consider mobile services for passengers a top investment priority over the next three years. By 2015, almost nine out of 10 airlines are planning to have a wide range of core services available via mobile, including flight search, check-in, boarding passes, ticket purchase, and ancillary services followed by  customer complaint handling and missing baggage management. Thus, according to the predictions based on the results obtained in the survey, 70% of sales, 91% of customer services and 71% of passenger processing tasks will be handled through smartphones by that time. However, the situation in such a technologically advanced segment as MRO is somewhat different.

Airline Business IT Trends Survey has revealed that a staggering 93% of all airlines consider mobile services for passengers a top investment priority over the next three years

“MRO providers typically have a vast collection of information that comes from OEMs, suppliers, and variousregulatory bodies. Therefore, mobile technology could provide an excellent platform to better leverage the wealth of the existing enterprise data,” shares Zilvinas Sadauskas, the CEO of Locatory.com “However, it is remarkable how quickly most executives can make a business case to buy another aircraft costing hundreds of millions of dollars – but struggle to justify any expenditure on technology that is just a fraction of the cost. As a result, what we see in the industry today is that many processes, especially the ones related to procurement, still rely on out-dated approaches and can even still be paper-based.”

Notwithstanding the emergence of software solutions for process automation in space, aviation MRO remains a highly effort-intensive service business. For instance, it has been found that some industry employees spend up to 80% of their time searching for and verifying the information that is required to execute their tasks. In the meantime, given that the developing regional markets are continuing to expand at a considerable rate, the supply of aftermarket parts will only become more complex, thus adding further pressure on improving the efficiency of parts supply chains.

“As mobile technology has found widespread acceptance among end users, who utilize mobile devices for performing a number of functions in their daily lives, most employees can be easily trained to apply them at work,” says Zilvinas Sadauskas, the CEO of Locatory.com. “An effective mobile solution would offer the ability to access all relevant task-level information from a single interface, thus maximizing efficiency and minimizing turn-around times. The process of ordering parts, tracking progress on different tasks and recording hours worked is complex enough already to be made more complicated by the outdated practices. What is evident today is that the future is mobile. If it is already improving business efficiency for airports and airlines whilst also enhancing passenger experience, there’s no reason why it can’t do the same for the other segments of the industry.”

During the last few years the gradual fleet renewal process has become a truly global phenomenon. As airlines struggling to cut down costs continue to demand more fuel efficient aircraft, the largest manufacturers have raised their production rates to a historical maximum and display no signs of downsizing their operations any time soon.  On the one hand, these processes have caused a major headache to the aftermarket players. They have found themselves in an urgent need to develop strategies for optimizing their supply chains in order to support the new generation aircraft. On the other hand, considering the on-going trends in the industry, it seems that it is too soon to forget about the current generation machines.

The manufacturing rates achieved by the major airframers in 2013 are indeed impressive. For example, Airbus managed to deliver a record number of 626 aircraft, and thus underscored its ability to maintain production rates at sustained high levels, responding to its industry-wide record backlog of 5,559 aircraft as in the end of the year. The fact that the manufacturer plans on pushing the limits even further – to 50 aircraft per month – reflects the constantly rising demand for new aircraft among carriers. However, it is currently not the only trend in the industry, albeit it is amongst the most prevalent ones.

The manufacturing rates achieved by the major airframers in 2013 are indeed impressive

“Despite the fact that currently most carriers seem to favour the fleet renewal strategy, when it comes to performance optimization, there are different options available, since the current generation of aircraft supports the expanding capabilities in terms of expenses,” comments Zilvinas Sadauskas, the CEO of Locatory.com “Moreover, such manufacturers as Airbus periodically suggest making most of the current aircraft as well. For example, the company’s representatives have stated that with 475 seats, the A340 would accommodate more passengers while offering a 7% reduction in operating costs. They also remain quite sceptical about the A330 re-engining: Airbus’ representatives are confident that the model can even compete with the Boeing’s Dreamliner, as it offers 35% lower engine maintenance despite the 10-12% higher fuel burn.”

According to TeamSAI, newer aircraft do require more ownership expenses, which can be up to $2 million per year higher than the ones for the current generation aircraft. This seems to be one of the reasons why such carriers as Delta Air Lines tend to invest into the current fleet and postpone the actual investments into purchasing new machines. Recently the carrier has announced its plans to pour $770 million into refreshing cabins and adding both seats and passenger creature comforts on its fleet during the next three years, stating that the idea is to keep older planes reliable whilst maintaining the appeal to passengers. These strategies may also involve buying entire aircraft for parts, and, according to specialists, may in fact prove to be worthy of sticking to.

“If an aircraft is well-maintained, clean, and has new interior, it is really hard to say how old it is. Therefore, the carriers which choose to invest into new aircraft in search of the ways to solve their economic issues may be looking in the wrong direction. After all, many factors suggest that air passengers don’t really care about the age of the aircraft. Nevertheless, it is worth remembering that any aircraft requires maintenance, including spare parts support, and the optimization of the supply chain for the newer model is still a difficult area to manage,” says the CEO of Locatory.com. “Meanwhile, the aftermarket for the current generation aircraft is a lot less problematic, and, considering the fact that the fuel prices are getting lower, in a few years’ time the switch to newer aircraft may prove to have been a hasty move.”

A conventional inventory management plan is usually based on an implicit assumption that nothing goes wrong in the supply chain. However, it quite often does. For instance, supply chains are as vulnerable to natural disasters as any other areas of aviation business. In order to prevent or at least minimize the chance of possible malfunctions in a supply chain it might be worth to review the supply chain management procedures from the perspective of an insurance broker once in a while. Determining the exact spare parts-related needs of a particular carrier and/or MRO provider may not only optimise the speed of relevant processes, but also bring considerable cost savings.

Storing spare parts for airplanes serves as an insurance against costly downtime. Thus, carriers and their suppliers must try their best to determine the most adequate insurance coverage, i.e. ensure that the right amount of spares is always in the right place and at the right price. When managing such processes many companies tend to rely on the spare parts lists recommended by OEMs or spares’ providers. However, these lists are normally formed whilst taking into consideration the average failure characteristics of particular components and parts or, in the case of a repairable unit, the average repair time only. Unfortunately, the specialists producing these lists tend to overlook the economic impact to an airline having an aircraft out of service while waiting for a spare part to arrive.

“Despite the fact that commercial aviation heavily relies on the spare parts supply, most commercial airlines and MROs are still managing their supply chain processes ineffectively, which often results in stocking enormous levels of spare parts while, at the same time, experiencing costly delays and downtime,” says Zilvinas Sadauskas, the CEO of Locatory.com.

It has been recently revealed that even if an airline invests up to $100-200 million in a spare parts stock it can still be unable to cover every possible malfunction or need

It has been recently revealed that even if an airline invests up to $100-200 million in a spare parts stock it can still be unable to cover every possible malfunction or need. For example, according to a survey carried out by Oliver Wyman consultancy agency, in North America alone airlines spend $110 million on over-insured and poorly positioned spares. Moreover, there are up to $65 million in spares which are under-insured, while being highly critical to operations. The latter are often subject to long lead times or are in short supply for aircraft-on-ground situations causing many maintenance-related delays and cancellations.

“Airlines must carefully consider the number, type and price of the parts they are the most likely to be in need of, not to mention the place that these parts should be deployed. Then they must proceed with categorizing the components and spare parts based on how critical they are to the operation and estimate the possible or average costs of downtime. Thus, by streamlining and eliminating redundant inventory management and logistics processes, the internal cycle times can be reduced by more than 50% resulting in considerable financial savings,” shares Zilvinas Sadauskas. “But there will always be some factors that can complicate the situation and are immune to meticulous planning. For instance, some rotable parts may no longer be manufactured or are too expensive to rebuild.  Also, an earthquake or any other natural disaster may simply demolish your stock.”

According to the CEO of Locatory.com, a good point to start is to prioritize what it is you want to protect and where to focus your energy. In the case of rare parts, you can establish your own stock by buying available spares on the market and establishing a control team to ensure their reliability and operability. Having a few used aircraft for teardown at your disposal is another option. Moreover, if there is only one source of supply, an MRO or a carrier may consider investing in or acquiring that supplier to ensure viability: here, even investing in a competitor can be justified.

“Without any doubt, sometimes planning is difficult, as some repairs are intermittent and variable. Meanwhile, many critical parts and components have long lead times and are expensive. You have to strike a balance between how many of those items you’re going to stock against the risk of not having them. In such cases, joint stocks or e-procurement systems become especially handy, as you don’t really have to buy too much, but can rely on a wide network of MROs and operators,” comments Zilvinas Sadauskas, the CEO of Locatory.com

urrently the number of orders for all Boeing 737 versions has passed 11000. As the manufacturer is planning to introduce its 737MAX into service in 2017, this figure is likely to grow considerably. With the record breaking production rates pushing the current generation of these aircraft into premature retirement, more and more aftermarket players are forced to recognize the negative implications of the increasing availability of the used spare parts. However, it seems that the possible design similarities between the current and the upcoming aircraft models may turn the potential disaster into a jackpot.

The in-service fleet of Boeing 737s is currently the largest among airliners, accounting for close to 6000 aircraft. With a record number of almost 3500 B737s waiting to be delivered, the popularity of the model is certainly expected to remain stable. Moreover, the manufacturer has announced that it will increase the production of the model from the current 38 to 47 aircraft in 2017 and as many as 52 aircraft per month in 2019. In other words, the company is expecting a more than 50% increase in aircraft production in less than 10 years. However, currently the growing number of aftermarket players have started to worry about the effects that this process will have on the spare part business.

“The pressure that the growing aircraft production rates are exerting on the aftermarket is increasingly becoming the central topic of discussion amongst aviation industry players. Basically, the problem is that what is normally best for an aircraft manufacturer is not necessarily good news for a spare parts provider,” explains Zilvinas Sadauskas, the CEO of Locatory.com “Naturally, increasing production rates help to reduce unit cost and thus are totally financially justified, especially since aircraft OEMs do not make much money from the aftermarket. However, an increased availability of newer aircraft means faster retirement rates. As a result, the aftermarket becomes filled with spare parts, some of which are low in demand whilst some have partly lost their value.”

The pressure that the growing aircraft production rates are exerting on the aftermarket is increasingly becoming the central topic of discussion amongst aviation industry players

Statistically, the retirement rates of the current generation B737 aircraft are in fact impressive. According to the recent AWIN report, currently almost 40 737NGs at an average age of 12 years have already been forced into a premature retirement with an objective to benefit from the spare parts sales. However, the existing demand might have been overestimated, since the current models are not as old and do not need as much technical attention. Nevertheless, it seems that the manufacturers which have started the mess might also be the ones to provide the solution to the problem.

“While some have been worrying about the shrinking aircraft retirement age, Boeing has repeatedly stated that the 737MAX will be designed so that it could be supported by the existing industry-wide 737 maintenance infrastructure. For example, the manufacturer’s representatives have made it clear that the new model will not require special certification for the MRO providers,” says the CEO of Locatory.com “This means that the 737NGs and 737MAXs are bound to have a quite high level of spare parts commonality, which will automatically straighten out the situation in the aftermarket.”

Certainly, despite the fact that the introduction of the newest member of the 737 family is on schedule, 2017 is relatively far away, and the decisions made during the aircraft design phase can and will bring some new aspects into consideration. However, if a significant amount of parts will migrate from the NG to its younger brother, the ones who are now blamed for causing the deflation in the spares market do share a chance to end up benefiting from the situation, as the value of stocked spares will rise along with the demand.

Speaking to the computer will no longer mean that you have suddenly gone crazy because of all the stress at work – you might just be in search for a spare part for your AOG-ed aircraft! Locatory.com has once again justified its name as one of the most innovative companies in the region. This time it has implemented a unique Voice Search function on its e-procurement platform. Locatory.com has become the first aircraft parts marketplace in the world to integrate such a solution.

Remember that feeling of excitement when someone in any of the numerous Sci-Fi movies like Star Trek or Star Wars demonstrates the ability to control some device or even the whole spaceship solely by using his voice? Well, it seems that the future we could have only imagined just a while ago is already here. Voice control has moved from mobile devices into such specific areas of life as aviation, as the Locatory.com has once again proven to have one of the most innovative programming teams in the industry by introducing the Voice Search function onto their platform.

“The decision to integrate a function which is uncommon in the industry was based on many factors of usability. We are always seeking to considerably simplify aircraft parts search procedures and the new voice search system is designed to do exactly that. Firstly, thanks to the Voice Search, Locatory.com will be instantly more user friendly for those clients whose vision is partially impaired. Moreover, those clients who lack efficient typing skills and are not technologically savvy have been taken into consideration as well, as speed is often a crucial factor, when you are in need of spare parts. Thus, it is only the first step in adapting the platform for conducting all the tasks using voice only,” commented Zilvinas Sadauskas, the CEO of Locatory.com.

We are always seeking to considerably simplify aircraft parts search procedures and the new voice search system is designed to do exactly that

In addition to the aforementioned benefits, the introduction of the Voice Search function exceeds the facilitated usability advantage. For example, by dictating the numbers of the spare parts the native speakers of the globally used platform will have the opportunity to combine business matters and learning, as they will be naturally forced to practice and improve their English pronunciation, thus developing their language skills, which are of immense importance in the global industry.

“In addition, we wanted to acknowledge the highly talented and beautiful representatives of the aviation industry – our female colleagues. There are lots of beautiful women in aviation, and we don’t want them to be hurting their much treasured manicure as much as they don’t want their aircraft to suffer from an AOG. So from now on all that the ladies need to worry about is their aircraft, but Locatory.com has already proven to be able to easily solve that problem as well, so as you see, with Locatory.com the industry becomes a better place to work in,” jokes Zilvinas Sadauskas, the CEO of Locatory.com

The function is currently available only for users of Google Chrome, which enjoys a 39% worldwide usage share of web browsers, making it the most widely used web browser in the world. The Voice Search is an experimental function of Locatory.com.