Most major U.S. airlines are outsourcing the performance of many maintenance tasks to repair stations in foreign countries to control and reduce expenses. Ever since the disruption to the aviation industry due to the 9/11 attacks, airlines have been evaluating the means to reduce costs and there are clear economic advantages in the outsourcing of maintenance and repair activities.
Many foreign governments have made significant investments to fuel the expansion of the foreign aircraft maintenance industry in recent years. They are able to build repair facilities at a lower cost than U.S. facilities, have lower wages for the maintenance technicians and provide other incentives to lure the airlines into their facilities. Although global outsourcing can provide a benefit to an airline’s bottom line, the management of the facilities and the quality of the maintenance tasks are key components to minimize the risks inherent in those decisions.
Routine maintenance and repairs have become the biggest areas that airlines outsource to cut costs. Outsourcing aircraft maintenance can reduce costs by as much as one-half to two-thirds based on having the maintenance performed on U.S. soil due to the cheaper labor rates. The most frequent maintenance tasks that are outsourced are the performance of major overhauls and modifications to both aircraft structures and engines, periodic maintenance and aircraft painting.
Airlines are now sending a significant portion of their aircraft for maintenance or repairs to overseas repair shops with roughly 20 percent going to facilities in developing countries. There are hundreds of FAA-approved repair shops in countries that include Argentina, El Salvador, China, Costa Rica, Indonesia, Ethiopia and Kenya.
Airlines are required by the Federal Aviation Administration (FAA) to perform routine maintenance on all of their aircraft at least once every two years. Due to the costs involved, the airlines are outsourcing aircraft maintenance at an alarming rate while the regulatory management of those facilities has not kept up. The main problem with outsourcing the maintenance to overseas repair shops is that these facilities are challenging to monitor.
The FAA is required to inspect and monitor all of the nearly 5000 FAA approved repair shops on a regular basis. It has been found that the FAA lacks the manpower and budget resources to adequately perform those inspections, especially for the foreign facilities. They rely mainly on local regulators and the airlines themselves to monitor these repair facilities.
Most foreign repair facilities do not have the same standards for the qualifications of the maintenance workers due to the shortage of qualified technical personnel. In many cases, the repair stations hire a large number of unskilled temporary workers and un-certified mechanics to perform highly critical maintenance tasks.
Many of the personnel in overseas repair stations are not proficient in the English language, so there is the potential for communication issues or mistakes being made when reading or interpreting the instructions in the aircraft maintenance manuals.
The regulations that need to be properly followed in overseas repair stations are more complex, often dealing with not only the FAA but also local regulators and the management of the maintenance processes of multiple airlines.
Recently, Congress introduced a bill called the ‘Aircraft Maintenance Outsourcing Disclosure Act of 2018’ that would require airlines to list the countries where that aircraft had maintenance performed on their websites, confirmation emails and boarding passes. This would have provided travelers the information where maintenance was performed to have available when purchasing their airfare. Unfortunately, the bill was never enacted, however, it shows the continuing concern over the outsourcing of these activities.
Although many believe that safety could be compromised through outsourcing, information gathered over the years shows that traveling by air has continued to be the safest form of transportation and outsourcing has not adversely affected aviation’s safety record.
Although the FAA may not directly oversee each repair station regularly, there are still a lot of people looking at the specific maintenance that is being performed, including local regulators and airline oversight, and there are built-in checks and balances to ensure that the maintenance activities are being performed correctly.
Ultimately, the decision to continue to outsource aircraft maintenance and repairs will be based on the cost savings realized by the individual airlines. If the airlines begin to see additional costs or lost revenue due to poor maintenance practices that result in flight delays, canceled flights or catastrophic failures, the process of outsourcing will likely be subject to change.
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