As you might expect, the aerospace and defense supply chain is a highly specialized area involving the transportation of high-value, high-tech equipment and parts. This includes moving many large items requiring special handling, up to and including aircraft wings, jet engines, rotors, and fuselage sections. It’s a pressurized logistical exercise affecting nothing less than the operations of both commercial and military/government aviation and space flight!
The aerospace and defense industry is on an upward trajectory in 2024, according to a forecast from Deloitte. Analysts noted both an increase in passenger miles and demand from stepped-up government space programs (up 8% in 2022), as well as geopolitical instability driving defense spending, but commercial space programs are expected to see a dip in investment. Yet, the aerospace and defense supply chain remains challenging, with Deloitte calling for “continued fragility … and disruption,” including parts shortages, leading to delays in production and delivery.
In this exciting but challenging sector, therefore, aerospace and defense companies need to see 2024 as a time to make sure that nothing in their supply chain networks will further hamper the flow of critically needed parts and equipment for demanding commercial and government customers. While there are many factors beyond their control – weather events, geopolitical issues and conflicts, and labor disputes – there are steps supply chain managers can take to help mitigate the risks from shocks and disruptions.
Introduction to the Aerospace and Defense Supply Chain
Cost, speed, and reliability are the primary watchwords for the aerospace and defense supply chain, with parts and equipment sourced from around the world. On-time and in-full delivery (OTIF) is never more critical, be it for aircraft-on-ground (AOG) maintenance, servicing a military installation or a manufacturer’s production line.
The aerospace and defense supply chain possesses several unique characteristics due to the complex, highly regulated, and technologically advanced nature of its manufacturing and operations. This includes a stringent regulatory environment, the far-flung supplier network, and the need for traceability and documentation of each item.
Due to a variety of issues – increased costs, production delays, maintenance challenges, quality concerns, and the risk of counterfeit or substandard parts – aerospace and defense supply chain issues could drag on for more than half a decade, Boeing president and CEO David Calhoun said last year at the Qatar Economic Forum, impacting a rebound from the pandemic.
Challenges in Aerospace and Defense Logistics
As noted, one of the more obvious challenges is the complexity and sensitivity of the high-value components. The many bulky, oversized items that go into aircraft and spacecraft require special handling as well as warehouse worker training. Much of these components are transported using heavy-haul trucking on large flatbeds.
There is also a constant need for emergency spare parts to keep production moving, calling for expedited shipping, more so than in many other manufacturing sectors. While plenty of air freight capacity is available, the costs are still significantly higher than other modes. Hotshot trucking is another often-used option when needed supplies are stored domestically.
The global aspect of the supplier network calls for a high degree of collaboration, coordination, and sophisticated logistics management to ensure that parts and equipment are getting where they need to go in a timely manner.
As with many other sectors, supply chain visibility remains an issue in the aerospace and defense industry. To tackle this, many companies are working on the digitalization of their systems, including the creation of “digital twins” to help proactively identify and address issues – moving beyond “predictive” to “prescriptive” analytics – and investing in advanced track-and-trace capabilities.
Navigating complex regulatory environments is another supply chain challenge for both exporting and importing. The industry is one of the more heavily regulated, along with pharmaceuticals and food, due to safety and security concerns. Compliance with standards from the Federal Aviation Administration (FAA), the European Union Aviation Safety Agency (EASA), and others is mandatory. Also, suppliers must meet strict certification standards for parts, materials, and manufacturing processes to ensure both airworthiness and regulatory compliance.
For these reasons, customs clearance is much more involved. Stricter export and import controls govern many aerospace and defense components. The reason for defense components is obvious; aerospace products require special licensing due to their sensitive, “dual use” nature for both civilian and military applications. Thus, to comply with safety standards and export/import controls and provide accurate documentation, customs clearance is a significant concern in the aerospace and defense industry. Ensuring smooth clearance involves meticulous attention to detail, adherence to regulations, and specialized expertise in handling customs procedures.
Dealing with daily AOG maintenance and repair situations is another major challenge in the aerospace and defense industry. As an AOG event can occur anywhere, from a major air hub to a remote location, requiring the stocking of a diversity of parts nearby, it presents itself as a logistical Rubik’s cube with few rivals. Even a single event causing a two-hour delay can cost from $100,000 to $200,000 and disrupt many flight schedules. So, the timely delivery of needed parts is required to keep these incidents from escalating quickly.
Aerospace and Defense Logistics Require Customized Solutions
Because of the complexity and scope of aerospace and defense logistics, next-level solutions, customized to fit very exacting requirements, are required, bringing in the following capabilities:
Advanced tracking and real-time data visibility: High-tech track-and-trace systems utilizing tools like artificial intelligence and machine learning, barcoding, IoT, and RFID are helping companies gain real-time visibility into the exact location and scheduled arrival time of every replacement part and manufacturing component in transit. The types of technology available today enable this kind of operation on a previously unthinkable scale.
Customized transportation solutions: A network of hotshot delivery drivers with medium-duty vehicles, as well as dedicated carrier networks always at the ready for larger loads, are needed to ensure sufficient capacity and the type of rapid response needed. A 3PL partner experienced in the aerospace and defense industry has the connections and expertise to pull all of these assets together.
Strategic warehousing and inventory management: By its very nature, the aerospace and defense industry has aircraft in constant motion, all of which require regular maintenance and repairs. There are far-flung manufacturing, sub-assembly, and supplier operations as well, calling for a high level of cohesion. Thus, the strategic design of warehouse networks, i.e., the placement of storage and distribution facilities, as well as the development of inventory management strategy, call for above-and-beyond levels of precision.
How Wicker Park Logistics Enhances Aerospace and Defense Transportation
Wicker Park Logistics, an experienced provider of aerospace and defense transportation solutions, understands the precision planning needed to ensure that all critical parts and components are delivered safely and on time, especially those requiring expedited service.
Our team works closely with you to design a custom solution that addresses your specific needs and ensures you hit your customer SLAs. From the special handling of bulky components and sensitive gear to matching vehicles and loads, pickup and drop-off scheduling, regulatory compliance, and customs clearance, Wicker Park Logistics has every aspect covered.
Our aircraft-on-ground (AOG) services ensure that urgent, time-sensitive shipments are handled quickly and efficiently. Wicker Park Logistics handles aerospace and defense companies throughout North America, including cross-border services into Mexico and Canada. And a logistics control tower approach provides true end-to-end supply chain integration, leveraging Wicker Parks’ optimized transportation service network.
Service components include FTL, LTL, hotshot trucking and last-mile delivery, real-time data visibility, a dedicated capacity network, on-demand digital access, reports and scorecards, expedited and time-critical shipping, warehousing and distribution.
When you choose Wicker Park Logistics, you’re going with a 3PL provider that has experience across the aerospace and defense sector, everything from armed forces and defense contractors, engine, launch systems, and spacecraft manufacturers to major airlines and maintenance/repair operators.
In A Complex, Demanding Sector, Choosing a Trusted Logistics Partner Is Mission-Critical
Aerospace and defense logistics is a different animal indeed, with serious levels of complexity behind the high-stakes operations that keep thousands of aircraft – and spacecraft – flying safely. From strict regulatory and customs requirements to the physical and technical characteristics of the components themselves, a particular kind of expertise is called for. To learn more about how Wicker Park Logistics can meet and exceed your expectations, speak to an expert today.
