British thinking on through-life management of military aircraft and systems is already way ahead of that of most countries. The Ministry of Defence (MoD) has encouraged innovative contracts that change a traditional industry stand-off role as, for example, a supplier of spares, into that of a partner committed to various packages of enhanced service. Now comes the next step–fully fledged availability contracting.
BAE Systems has embraced the challenge and created a Customer Solutions and Support (CS&S) subsidiary that is already worth $5.4 billion in annual sales, about two thirds of that deriving from air systems. CS&S does business in Australia and Saudi Arabia as well as the UK, but visitors to the BAE pavilion at Farnborough International may be more interested to hear of progress closer to home.
Earlier this year, the company submitted a fixed-price proposal to provide support for the UK Royal Air Force Tornado fleet over the next 10 years. The Availability Transformation: Tornado Aircraft Contract (ATTAC) is potentially worth $2.7 billion, but BAE must provide defined levels of capable aircraft, spares, technical support and training to the front line.
The MoD aims to reduce the 300 contracts that are currently in force for Tornado support to just two–one with BAE, and the other with engine supplier Rolls-Royce. The ATTAC contract could reduce the flying-hour cost of the RAF’s main strike warplane by up to 50 percent. BAE has also bid for an availability-based contract for the RAF’s Hawk jet trainers, and will submit a similar proposal for the Harrier fleet.
The company is already operating combined upgrade and “depth” maintenance programs for the Tornado and Harrier at RAF Marham and Cottesmore, respectively. The RAF remains responsible for “forward” maintenance, including deployed operations. Some air force personnel work alongside the BAE teams.
According to CS&S, Tornado downtime has been reduced by 35 percent since BAE arrived at Marham. The number of Harriers in upgrade or maintenance at any one time is being reduced from a planned 24 to an average of 13. The company has redesigned the supply chain supporting these activities for better asset tracking and lower inventory. Together with the Defence Logistics Organisation (DLO), BAE has designed a Web-based technical documentation system.
The ATTAC could be signed by the end of the year, according to a company spokesman. But at Farnborough this week, CS&S expects to receive the first whole-plane availability contract for the RAF’s Nimrod MR.2. BAE has been doing integrated maintenance and support for this aircraft since 2002, and holds a similar contract for the RAF’s VC-10 tanker-transports.
The DLO has already agreed to some availability contracts at the subsystem level. BAE provides secondary power systems for the Tornado on this basis, “at 23 percent less than historical costs,” according to the company. The contract with Rolls-Royce for RB.199 engine support on the Tornado is another example. BAE is also guaranteeing the availability of some high-value 800 line-replaceable units on the RAF’s new Eurofighter Typhoons.
The Typhoon is supposed to be three times as reliable as the Tornado. Ultimately, CS&S expects to sign a whole-plane availability contract for the RAF’s new combat jet, but that will not be until both sides have understood the “arising rates” for replacement parts. There have been some hiccups in early Typhoon availability at the first operating base, RAF Coningsby. In defense of the product, a BAE spokesman noted that “the RAF has done 50 percent of all Typhoon flying, but has bought only one sixth of the spares to date.” There are three other Eurofighter partner air forces.