Point de vue

Post Covid-19 Aerospace Industry

 An opportunity to embrace the 4.0 Era?

Industry 4.0 capabilities (Smart Factories) will deliver benefits across four major aspects, essential to cope with post-crisis cost-out requirements:

In our previous publication, we explained how the sudden global passenger air traffic halt triggered by the Covid-19 pandemics led to many detrimental consequences for aircraft manufacturers:

  • Many airlines are struggling, Flybe and Virgin Australia felt into bankruptcy and Norwegian came very close to it; Lufthansa engaged a strong restructuration of its fleet, expecting to reduce its fleet by 100 aircrafts throughout the crisis (from ~760), starting by the last least fuel efficient quadri-reactor planes (A380, A340-600, B747-400). 
  • Therefore, the outlook for aircraft deliveries over the three to four years appears dismal, analysts expecting a drop from an expected 5,000 to 6,000 units before the crisis to a more realistic 3,000 to 4,000 aircrafts
  • As a consequence, as airlines either cancel or postpone orders, aircraft manufacturers undergo the emergence of “white-tail-fleets”, as many aircrafts are left unaffected at an advanced stage of the manufacturing process

During the last decade, the rush for high production pace has overwhelmed aircraft manufacturers, overshadowing the full deployment of digitalization initiatives (IoT, AI, Analytics, and Virtual Reality). Therefore, if adoption of smart technologies is now reaching significant levels in various industries (in average from 66% either to 87% - in use or in deployment), aircraft manufacturers still limited the deployment of such technologies to POCs, lagging thus far behind of the pack.

Figure 1: estimated adoption levels of Smart Factory technologies (all industries)

As aircraft manufacturers have temporarily revised production rates downwards to adapt the new depleted market environment, they should take advantage of the demand slowdown to take a breath in the race for production.

Governmental financial support programs will be deployed, aiming at not only meeting companies’ cash requirements, but also at helping them perform the investments necessary for deep and structural transformations. Aircraft manufacturers should indeed capitalize on this period to improve operations by deploying digital capabilities and new ways of working. This way they will better prepare for the business recovery on both Manufacturing and Supply Chain sides, with expected benefits across four major performance aspects:

  • Production capacity utilization
  • Product quality
  • Operations and maintenance costs
  • Safety and security


Benefits of Smart Factory technologies across aircraft manufacturers operations

Smart Factory technologies play on five major levers:

  • Connectivity, as assets outfitted with smart-sensors throughout the whole value chain can now be integrated to business information systems 
  • Transparency, bringing real-time data visualization about processes and operations 
  • Proactivity, allowing predictive maintenance or process anomaly detection
  • Efficiency, with strongly increased automation capabilities
  • Agility, as simulation capabilities are expected to improve dynamic decision making

Figure 2: estimated adoption of Smart Factory technologies

The better integration of these technologies within aircraft manufacturers can lead to improved performance across four major performance aspects:

  • Asset capacity-utilization improvement (10-20%): Sensor-equipped assets and processes (IoT) enable aircraft manufacturers to track a wide set of KPIs in real time with three key benefits: reduction of process variability, improvement of throughput performance and yield and dynamic planning capabilities enablement to optimize even further capacity utilization.
    • First, automation and advanced robotics reduce fluctuations in asset performance: machines are programmed with defined work standards and potential unexpected status changes or sub-par performance are immediately reported for action, hence decreasing process variability. Going a step further, machine learning and cognitive technologies are used for self-adjustment on simple variances, therefore limiting human intervention to the most critical situations.
    • Second, digitalization offers an end-to-end near-real-time overview of production operations rather than a siloed approach with views on only one unit at a time. As KPIs specific to each job sequence are gathered and channeled up to command centers, bottlenecks or deadlocks lengthening lead times (e.g., missing tools or parts) will be quickly identified for prompt action, therefore increasing production throughput and yield.
    • Third, Smart Factory capabilities bring aircraft producers more process flexibility, such as reduced changeover times and modular automated workflows: dynamic planning practices allow production schedules and process simulation, in order to better adapt to demand fluctuations (e.g., changes in aircraft model, customization). In that respect, Deloitte launched a cloud-based application called “Smart Factory Fabric” for which Spirit AeroSystems in September 2019, a large aero-structures manufacturer, has been an early adopter: the app documents and tracks every part of the 767 forward fuselage assembly process, enabling dynamic production schedules based on advanced algorithms and automated material movement.
  • Product quality improvement and quality controls optimization (10-35%): Smart technologies enable automated in-line quality inspection, reducing the need for reworks – or increasing its efficiency - and facilitating the construction of feedback loops.
    • In-line quality controls are performed thanks to scanning technologies and sensors along the production chain for early detection of process anomaly and aircraft defects. Contrary to tradition quality checks taking the product out of the line for inspection, smart quality insurance can be carried out “on the go” without interrupting production, therefore reducing scrap rates. The most advanced quality controls entail automatic correction based on Artificial Intelligence and machine learning. For example, Spirit AeroSystems developed a system comparing an ideal image of a complex assembly to units produced, with the Lynx™ Visual Inspection System, to identify missing parts or parts installed incorrectly.
    • Necessary rework is facilitated by robotics and guided by sensor data, thus much more relevant and accurate, therefore increasing overall yields and efficiency.
    • Upon the final quality assurance step, Smart Factory tools facilitate fully automated feedback loops on faced issues (both solved and unsolved) on products, as failures are communicated in real-time to the command center concomitantly with process parameters for in depth and quantitatively substantiated root cause analysis. This supports continuous improvement for lean execution.
  • Reduced operations and maintenance costs (20-30%):
    • Automation and digitalization bring a great opportunity for aircraft manufacturers to review their organizational approach with three key benefits: shorter lead-time, optimal resource allocation and team effectiveness.
      • As job sequences are mostly programmed and simplified, with little human intervention, production and supply chain lead-times are highly reduced. For example, thanks to 3D printing deployment for jet engine fuel nozzles manufacturing, GE divided the number of parts requiring assembly operations by twenty, hence shortening lead-time by ten times.
      • Furthermore, optimal resource allocation and planning allowed by dynamic production schedules help reducing idle time and waste, refocusing resources on high-value-added tasks. Indeed, Smart Factory technologies allow virtuous circles in terms of human capital management: while the need for unskilled operators decreases, there is an opportunity for skills and capabilities building. For instance, in command centers, teams should be upskilled to make informed decisions based on advanced analytics.
      • Finally, a wide range of digital resources is available to improve team effectiveness on the ground, such as work orders with customized or augmented-reality instructions, tailored troubleshooting guides and checklists. Many operational issues can be solved quicker and at a lower cost, instead of resorting to remote-resolution call centers. For example, Dassault Aviation implemented Diota's Digital-Assisted Operations solution: operators visualize directly right in front of them pinning instructions on the sail. They only need to put the pins following the references and localizations indicated.

 

On left : Operator drawing markers on the sail with paper instruction
On right : Operator visualizing directly on the sail instructions with AR

Figure 3: augmented reality application at Dassault Aviation

  • Command centers provide an integrated view on operations to avoid disruption risks and optimize costs (incl. logistic costs and working capital requirements), through near real time performance monitoring, advanced analytics to drive operational excellence and risk-based decision-making.
    • Aggregated metrics, channeled upwards from asset sensors, are tracked to bring full transparency on end-to-end operational performance at a granular level in near real time. Responsiveness is critical in case of bottlenecks or deadlocks and a quick mitigation limits downtime costs.
    • Command centers are also at the hearth of failure root-cause-analysis, powered by algorithms, process simulation and correlation modelling. For example, in its Saint Eloi factory near Toulouse, Airbus developed visualization tools based of the digital twin of the entire assembly line to make more accurate process simulations.
    • Finally, command centers and deploying risk-based asset management, i.e. making decisions based on asset criticality to production, for which condition or status change can be quickly identified through connected sensors.

 

Figure 4: typical use cases of Smart Factory use cases delivering tangible KPI-measured performance improvements
(Notes: JPH – Jobs per Hour; FTT - First Time Through; OEE - Overall Equipment Effectiveness)

  • Increased safety and sustainability (3-10%) :
    • In terms of safety, digital capabilities can facilitate analytics and reduce safety hazards for workers: Root cause analyses on risky staff behaviors are performed in the command centers, with outcomes rapidly cascaded to teams, to increase awareness on best practices, reduce potential injuries and foster employees’ wellness at work. Furthermore, robots are highly relevant in multiple safety use cases, such as dealing with tasks either dangerous or physically demanding for human workers.
    • On the sustainability side, advanced statistical process control can foster energy efficiency and help cutting GHG emissions. According to Airbus’s estimates, energy consumption in aircraft production could be reduced by 20%, as algorithms propose energy-saving measures, based on smart meters’ usage data. Besides, robotics can make product dismantling and recycling of easier.

 

Conclusion

Although responsiveness, productivity and agility benefits for aircraft manufacturers are undisputed, 4.0 technology investments will be an extra financial stretch in an industry already under pressure. Therefore, the two following considerations can help decision-making on investment assessment and execution:

  • Groundbreaking transformation does not seem realistic due to tight resources, especially for players asking for governmental bailout. Investment proposals should then be backed by strong business cases, and their consistency with existing initiatives well documented, as add-ons could be preferred over disruptions to strengthen feasibility. Investment proposals should bring short-term benefits to aircraft manufacturers to address current challenges such as reduced teams on-site, e.g., increased asset connectivity and remote-control options, IoT-enabled inventory management.
  • From the execution point of view, however, we can be optimistic, as aircraft manufacturers have already demonstrated strong discipline capabilities.

Therefore, investments in Smart Factory capabilities are to be look through a long-term lens, as they essential to support a recovery on sustainable pillars and build competitiveness in the long-run. Many companies may wrongly favor speed over sustainability for the ramp-up of their Smart Factory initiatives, hence operating their businesses on pre-crisis patterns, without considering upcoming climate requirements. Conversely, building up on digitalization during the slowdown will enable a leaner and greener bounce back.

  • Prior to Covid-19, this year was meant to be a milestone on the sustainability agenda, as IATA’s target set a cap on net aviation CO2 emissions from 2020, to encourage carbon-neutral growth in air transport. Longer term, the reduction target by 2050 amounts to 50% vs. 2009 CO2 net emission levels. Once the dust caused by the outbreak settles, these environmental objectives will come back to the fore. In this respect, investments in Smart Factory capabilities will serve as sustainable pillars for operations improvement and target compliance.
  • Smart Factory capabilities should be deployed across the whole value chain, not only the large aircraft manufacturers and Tier 1 suppliers, to enable sustainable competitiveness, avoiding future bottlenecks coming from lower tier or small suppliers not having fully embraced then 4.0 transformation. Thus, at the end of 2019, GIFAS (French aerospace industry association) launched a three-year program with a €23m budget for 300 medium-sized companies to embrace the Future of the Industry, with the implementation of 4.0 technologies. For example, two significant ongoing pilots at Mecaprotec Industries, specialized in surface treatments against corrosion and deterioration, and Gillis Aerospace, an aerospace fasteners manufacturer, respectively focus on trimming automation and robotics improvement for parts loading and unloading. French government support initiatives to the aerospace industry will also have to address the need of lower-tier suppliers to improve their competitiveness through 4.0 investments.