MRO-related challenges such as a lack of digital records, supply chain difficulties, system inconsistencies and burdensome costs can be solved using blockchain – cutting MRO costs by billions of dollars.
That’s according to air transport communications and information technology specialist SITA, which has released a white paper on the impact of blockchain on the MRO sector.
The air transport industry spends US$50 billion a year on aircraft spare parts, SITA said, but the tracking and tracing of these spare parts as they move between airlines, lessors and OEMs “remains largely a manual process”.
“There is no one single view of how to track hundreds of millions of records of transactions between these entities, exacerbating risk and cost,” said SITA. “And if there is any inconsistency between stakeholder systems, the risk of data overlap increases – as does cost.”
The white paper offers a framework and new cost efficiencies to help airlines address a variety of challenges impacting MRO buyers, engineers, admin staff and other decision makers.
“Blockchain technology offers a solution to this massive level of fragmentation, based on inherent trust and reliability,” according to the white paper. “Offering a ledger of digital events that can be replicated, shared and trusted – based on consensus between parties – blockchain offers resiliency, traceability, disintermediation and proof against tampering.
“Key to the advantage of blockchain is its ability to create new ways of publishing and sharing information based around a single source of truth and shared control of data by stakeholders.”
SITA stated that, at its core, blockchain records what has been called a digital ‘birth certificate’ for any and every part installed in an aircraft. The certificate is updated every time the aircraft or a part is serviced or inspected. “The birth certificates of all the parts can be brought together to create a digital twin of an aircraft or complex assembly,” the organisation noted. “This can provide a complete record of the asset from the day it’s built to when it is finally broken up.
“And the rewards are significant: PwC has found that efficiency gains enabled by blockchain could cut MRO costs by about US$3.5 billion, while increasing industry revenue by as much as US$40 billion.”