Impact & Modifications in the Aviation Industry’s Supply Chain Post-COVID-19
How can any industry do better these days?
Stuck in a pandemic with a state of an imposed lockdown in every country, there is a halt of services in every sector. The only sectors in the market that are to fly high overcoming the COVID-19 outbreak are the ones adopting and utilizing technologies and digital platforms.
The aviation industry is one of them which even after facing a complete halt in its services is aiming at enhancing its business operations by increasing efficiency, deploying digital skills, and by new operating and working methods.
That is exactly how any industry survives, by working as per the trends and adopting new technologies plus improving the vastness of opportunities.
Impact and lessons learned due to COVID-19
The COVID-19 presented the aviation industry with a sudden halt in global air traffic (which has never been the case).
As per Deloitte, the global air traffic has dropped -80% compared to January 2020 with fleets immobilized since mid-July. Such a slow case of services has numerous consequences, it has not just impacted the economy as a whole but the negative impact has left the aircraft manufacturers concerned as well.
Leading industry analysts and experts consult estimated that the aviation industry is to gain normal global traffic similar to 2019 is to take two to five years to get normal.
During such a crisis, it might seem a challenge to cope up with it, but the best way to overcome the scenario of a crisis is to take a break in the race of production and aim at improving efficiency, adopting the latest technologies, and transform digitally to deploy business operations so that the results are achieved faster by simultaneously taking the time to focus on the production.
It is better to go for increasing the efficiency of the operations as some aircraft manufacturers have temporarily reduced their production rates to work as per the requirement of the market and the new and rapidly changing environment.
IATA’s recent forecast indicates that airlines will need more than $200 billion in bailout money to sustain operations beyond August. Also, a halt and sharp decline in the global air traffic has also deferred aircraft deliveries and have majorly impacted the supply chain.
Also Read- Transforming Asset and Inventory Management with Digitization
Solution for a stable future of the aviation industry
The manufacturing industry of aircraft, parts, and the engine is also estimated to lose its touch in the market due to a crash in the commercial demand.
Moreover, the major aircraft manufacturers such as Airbus stated that the global monthly production of its A320 will fall to 40 a month from 60, which equates to approximately US$2 billion (£1.5 billion) each month, for the rest of the year.
As a result of the falling deliveries in the aircraft, engine, and parts manufacturing industry, the IBIS World forecasts that the industry’s revenue will decline by between 10% and 20% in 2020–21.
The solution that is visible in these tragic times to pull the industry towards betterment is to accelerate the deployment of Industry 4.0 (Smart Factories), transforming the management of supply chains, by opting for a “pull” model, and by building integrated management processes, to overcome the issue of “white tails”. Not just this, the conversion of MRO operational abilities will also be marked as an essential practice.
