Paris Air Show

Bombardier plans menu for aftermarket services

 - June 12, 2007, 5:37 AM

Bombardier’s business model for the C Series airliner family includes fleet management services along the lines of Boeing’s GoldCare program for the 787 that would enable operators to pay a fixed per-hour fee to cover maintenance, spares and overhaul.

Now the Canadian airframer is considering a similar program for its existing regional aircraft.

“As we talked more about the C Series, we began to examine the idea of migrating the same concepts to our existing programs,” recalled aircraft services and new commercial aircraft president Gary Scott in Belfast last month. “Pierre [Beaudoin, Bombardier Aerospace president and chief operating officer] asked me a little over a year ago to take what we’re planning to do on the C Series and look at applying it to the existing programs. So we’ve been escalating our focus in this arena over this last year.”

Scott said the first element of his mandate for service is a global network. “We sell our products worldwide and our core services need to support that. We also provide some specialized platforms to government and quasi-government customers, so we need to look at expanding the services offering to them as well.”

Another is total life-cycle cost. Just as in personal relationships, he said, courtship and marriage may be the fun time, “but the real proof is the thirty years of marriage after the ceremony. That’s when our customers tell us whether we’ve got a successful product or not.”

The company already has “a great base” to establish global reach, he said, with manufacturing facilities across North America and in Europe plus an existing network of service centers. “We have six service centers in North America; we also provide service out of Belfast and in Berlin and out of some of our other manufacturing sites. But we need to expand. We also have a relationship with many service providers, more than 30 authorized service facilities around the world that support Bombardier products.” Parts are also delivered through the service centers.

Three years ago Bombardier embarked on a mission to improve its parts distribution network. “We’re really starting to reap the benefits of that investment,” Scott said. The company ships around 80 percent of its parts from a main warehouse in Chicago, but there is a second warehouse in Frankfurt and other depots around the world, with new ones planned for Tokyo and São Paolo.

“We’ve been growing the inventory but we’ve been growing the right inventory, trying to have the right parts in the right place at the right time so we can improve our off-the-shelf availability,” said Scott, commenting on distribution efforts. “In the last year we’ve been able to improve our availability by 10 percentage points, from roughly 80 up to roughly 90 percent, which is close to where we need to be to provide the amazing customer experience that we need. We’ve been adding inventory in Frankfurt and we’ve improved our availability there by 15 percentage points.”

For business jet operators Bombardier has doubled the size of its Dallas service center, which can now accommodate two Globals, four Challengers and eight Learjets simultaneously, and is applying new employee-developed procedures such as using covers to protect leading edges, seats and windshields.

Few business jet operators do their own maintenance, and airlines are realizing that carrying out maintenance doesn’t add value to their businesses. “Nobody knows more than Bombardier about our airplanes,” Scott said, “so it makes sense to have Bombardier be a one-stop shop, have us work with suppliers and provide maintenance services.”

The result, he said, is positive for all three–reducing customer costs and maintenance downtime, and reducing suppliers’ costs by enabling them to focus on a single relationship with the OEM rather than multiple customers around the world. “It adds value to Bombardier, to our suppliers and to our customers.”

There will be a menu of services, Scott said, while outlining a four-stage transition to the new aftermarket business model. The traditional approach includes base services in aircraft sale and costs maintenance activities on a time and materials basis. The smart services portfolio, offered mainly on the Challenger and Global business aircraft, includes parts maintenance, engine maintenance and training services on a cost-per-flight-hour basis. Integrated services merges the traditional approach with parts logistics and services capabilities. Fleet management, finally, would offer nose-to-tail total in-service support for a fixed cost per flight hour.

Training Services Expand
While the spares support needed improving, Scott said, “I think if you ask customers they would tell you that our training offering is probably second to none.” There are two main centers, one in Montreal with six simulators and another in Dallas-Fort Worth with seven housed in CAE’s facility.

“We’re adding to this training footprint with the new Learjet 60 XRs and we’re beginning to expand outside North America. We’ll be introducing a Global simulator into Europe early next year. So we’re going to be in places where our customers want to be because not all European or Asian customers want to fly to North America to get their training.”

The company is also active in the military training field and is pursuing training system integrator opportunities for several countries planning to update their pilot training programs, Scott said. It  also participates with Canadian industry for the Canadian air mobility operational training system, and watches for opportunities in Joint Strike Fighter training for Canada and some European countries that expect to buy the new combat aircraft.