23 Jan 2008 | Ref. 020/2008
Prestwick, Scotland. BAE Systems Regional Aircraft has carried out a number of major reviews of its spares support business and has taken steps to position it to meet changing future market needs.
The current business provides spares support for around 800 aircraft worldwide and has a yearly turnover of some $150 million. It provides a continuing spares sales and AOG (aircraft on ground) service operated from its Prestwick, Scotland, headquarters and with warehousing and logistics located at the Weybridge, Surrey, Spares Logistics Centre (SLC).
It also has a growing e-business selling Spares on the Web. It operates 'spares by the hour' services with 180 aircraft enrolled on to its JetSpares (jets) and MACRO (turboprop) programmes and is enjoying increasing success selling its logistics expertise to third parties.
The review started in mid-2006 in the light of the changing market dynamics in Regional Aircraft's customer base. It was clear that fleet fragmentation into smaller operators was a new feature, combined with a wider geographic dispersal of operators and a movement away from North America as a prime home for the company's products.
In addition, it was clear that new investment was needed at Weybridge and that IT and process improvements were necessary to meet the demanding expectations of customers. Slow moving stock and large items needed to be moved away from Weybridge and surplus spares stock needed to be sold, ensuring that the right stock needed by customers was the priority. The aim was to turn the SLC into a high-turnover, fast-moving warehouse operation and, with the new space created, offer opportunities for third party companies.
The results of the reviews have been gradually implemented across the spares support business over the past year with the following changes resulting:
- With the downturn in the North American spares business, the Herndon, Virginia satellite warehouse serving the Americas was closed in mid- 2007 and the spares stock transferred to Weybridge. The Herndon office remains open for Asset Management sales and leasing activities;
- The changing nature of the Jetstream 31/32 market has led to the appointment of Saywell International as Regional Aircraft's sole distributor of spares for these aircraft from early February 2008. Stock transfer is underway from Weybridge to Saywell's Worthing, UK and Florida, USA facilities. Both Regional Aircraft and Saywell believe that this transfer will result in a better, more focussed service to the smaller operators in the now geographically fragmented Jetstream 31/32 market;
- £250,000 has been invested in a new Kardex Shuttle XPlus Carousel automated storage system at the SLC. This state-of-the-art equipment reduces floor space by 90% compared to conventional racking and is fully linked into Regional Aircraft's IT systems;
- RFID (Radio Frequency Identification) mobile bar-code scanners have been introduced to the SLC, resulting in much quicker, more effective use of operators' time, significant stock accuracy and 'pick' efficiency;
- More space has been created at the SLC through the removal of slow moving and large items to the Prestwick Logistics Centre and the sale of surplus stock;
- Agreement has been reached for the co-location at Weybridge of the Ansett Spares & Services spares stock from its Heathrow, UK warehouse under a four-year lease deal. Fast moving parts for all major commercial aircraft manufacturers will be managed from Weybridge by Ansett from its own dedicated office and warehouse space, while oversized components will be stored at Prestwick. Ansett has also purchased a substantial amount of BAe 146/Avro RJ surplus stock from Regional Aircraft;
- Ansett Spares & Services and Regional Aircraft will set up a senior management Steering Board to develop an overall strategy for mutually beneficial co-operation across common business areas of aircraft spares support services.
These changes mean that Regional Aircraft is now better positioned to offer quality long-term sustainable spares support services for its core BAe 146/Avro RJ, ATP and Jetstream 41 markets. A continuing programme of investment in new equipment and processes is being implemented. Marketing for both shared facilities at Weybridge or operations and logistics services on behalf of third parties is being increased.
About BAE Systems
BAE Systems is the premier global defence and aerospace company delivering a full range of products and services for air, land and naval forces, as well as advanced electronics, information technology solutions and customer support services. With 96,000 employees worldwide, BAE Systems' sales exceeded £15 billion (US $27 billion) in 2006*.
* On a pro forma basis, assuming BAE Systems had owned Armor Holdings Inc for the whole of 2006
For further information contact:
David Dorman, BAE Systems
Tel: +44 (0) 1582 488336 Fax: +44 (0) 1582 488447
Email: ddaviddorman@aol.com
Scott Hailstone, BAE Systems
Tel: +44 (0) 1252 384725 Mob: +44 (0)7793 423068
scott.hailstone@baesystems.com
Issued by:
BAE Systems, Farnborough, Hampshire GU14 6YU, UK
Tel: +44 (0) 1252 384719 Fax: +44 (0) 1252 383947
24hr media hotline: + 44 (0) 7801 717739
www.baesystems.com
