How do you manage aircraft maintenance contracts and suppliers?

1 Maintenance contract types

Airlines have various types of maintenance contracts to choose from, depending on their needs and preferences. Time and material (T&M) contracts are based on the actual hours and materials used for maintenance tasks, offering flexibility and transparency but also uncertainty and variability in costs. Fixed price contracts, on the other hand, are based on a fixed amount per maintenance event or period, providing predictability and stability in costs but less flexibility and control over the maintenance process. Lastly, power by the hour (PBH) contracts are based on a fixed amount per flight hour or cycle, allowing alignment and incentive between the airline and the supplier yet having higher complexity and dependency on the supplier's performance.

3 Maintenance contract negotiation

Negotiating a maintenance contract with a supplier is a complex and dynamic process that requires careful planning, preparation, and execution. It involves finding the balance between the interests and expectations of both parties, while ensuring a fair and mutually beneficial agreement. To achieve this, it’s important to define your objectives and priorities, do research and analysis, build trust and rapport with the supplier, and be flexible and creative. Gather relevant information about the supplier, the market, the industry, and best practices such as benchmarks, trends or standards. Establish a positive relationship based on honesty, transparency, and professionalism. Consider different options that can address your needs as well as the supplier's ones such as incentives, penalties or contingencies.

4 Maintenance contract management

Managing a maintenance contract with a supplier is an ongoing and iterative process that requires constant monitoring, evaluation, and improvement. It involves ensuring the compliance and performance of both parties, while resolving any issues or disputes that may arise. To manage the contract effectively, you should set clear and measurable goals and indicators, track and report progress and results, review and adjust the contract when necessary, and recognize and reward performance. Defining specific goals and indicators that measure success and satisfaction, such as availability or reliability, is essential. Additionally, collecting and reporting accurate data on hours, costs, or defects is important to show progress. Furthermore, you should review the contract periodically to reflect changes or developments that may affect the maintenance process. Finally, acknowledging and rewarding the supplier's performance as well as your own is a great way to ensure success.

5 Maintenance supplier relationship

Maintaining a healthy and productive relationship with a maintenance supplier is essential for the long-term success and sustainability of the maintenance contract. It requires creating a partnership and collaboration based on mutual trust, respect, and value. To foster a positive relationship with your supplier, you should communicate and listen to them regularly and effectively through various channels. Additionally, it's important to share and learn from each other's knowledge and experience by exchanging best practices, insights, or feedback. Furthermore, you should support and assist the supplier in any challenges or difficulties they may face, as well as seek their support and assistance when needed. Finally, it's important to appreciate and celebrate the supplier's contributions and efforts by expressing gratitude, recognition, or praise.