Leeham News and Analysis
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Leeham News and Analysis
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ZeroM, Airbus’ effort to reduce traveled work
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By Scott Hamilton
Jan. 16, 2023, © Leeham News: Traveled work is the bane of any airplane manufacturer’s production line.
“Traveled work” is when parts are unavailable when the plane is in final assembly. To keep production moving, the manufacturer—whether it’s Airbus, Boeing, Embraer, or some other firm—notes the missing item and continues production. The airplane is rolled off the line and the work is finished on the ramp when the part becomes available.
Jurgen Westermeier, Airbus Chief Procurement Officer. Credit: Airbus.
The OEMs (Original Equipment Manufacturers) approach the issue differently. Some prefer the parts to arrive “just in time,” which keeps inventory to a minimum. This reduces cash outflow.
But just in time creates the problem of missing parts. One time, Airbus was assembling A320s, and USB ports failed to arrive while planes were on the assembly line. The ports had to be installed later—traveled work.
Another option is to create an inventory. But to minimize the cash commitment, and the space taken up by inventory, the OEMs limit the supply. Airbus, for example, has a “buffer” of between a few weeks and a few months, depending on the parts.
Airbus also attacks the challenge with a program called ZeroM. LNA met last month with Airbus’ chief procurement officer (CPO), Jurgen Westermeier, on the sidelines of the Aviation Forum in Hamburg. He explained ZeroM and how it works. Below is a transcript of our meeting. It has been edited for clarity and space.
Zero Missing Parts
Editor’s note: Airbus and Boeing, among others, occasionally embed their personnel at suppliers when there are difficulties. Airbus has about 1,800 personnel in the field. Boeing has a team embedded at Spirit AeroSystem, which makes the nose sections for the 767, 777, and 787 and the entire fuselage for the 737.
ZeroM is a program designed to prevent delays in shipping parts.
Westermeir: Zero M is something we started developing a year ago. Zero M means Zero Missing parts. It’s the vision to have zero missing parts.
What is good is that we have Skywise which helps us with the data intake. We now have the transparency of all flows, which we didn’t have before. It is down to our Aerostructure companies. What is the inflow of parts from the suppliers? What is the flow from plant to plant? Full transparency so we know where the missing part is.
Editor’s Note: Boeing uses a system called Enterprise Resource Planning (ERP) to track parts coming into Boeing.
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We are now combining this with artificial intelligence. We started before the summer break, and we want to fully roll it out next year. We identified about 10 key criteria for around 20,000 parts. This is a survey in real-time and with the key criteria. We can now see that when we do this, we can identify six weeks, five or six weeks, in advance with 70% confidence, parts that will be missing parts in the future. With these six weeks, we have time to anticipate and mitigate, and where we have already done this, we have seen a significant improvement.
Necessary for high production rates
Today our fulfilment rate, our fulfilment performance, is better than in 2019. This is necessary because of the high rates we are entering next year. We need this stability to ramp-up and not get distortions in the system. More stability in the supply chain, and surveillance of the suppliers where there are issues. When we identify issues, very strong joint improvement plans to sustainably bring them to the level where we are.
This was the key to what we have now achieved. This is also why I think we are ready to do the ramp-up. We should not be overconfident as we are ramping up all three programs. We are going to rates which we have never done before. We need everything we have established in the last three years and which we will continue into the NextErA, the next ecosystem for aerospace and defense.
In our industry, we count on having a standardized way of digitalizing the supply chain and the Gaia-X principles, data space, and data contracts. This gives us the data that we can collaboratively, with artificial intelligence, use to predict where there might be issues and mitigate them before they come.
LNA: You mentioned that you have a 70% confidence rate. That still strikes me as being, in the scheme of things, lower than you would want. There’s a 30% chance of being surprised.
Westermeier: This is actually a strong increase. In the past, aerospace supply chains were managed with buffer stocks and, as it was manual, you got surprises. Right now, if I roll this out, I can eliminate 70% of the surprises, and the 30% are really low. We are already translating today into a better fulfillment rate, as we had in 2019. This is an incredible step forward in supply chain performance.
Increasing local aerospace clusters
LNA: In the United States you’ve got the Mobile A320 and A220 plants. You want to increase the production rates for the A320 line. The A220 eventually must come up as well. Do you want to increase the actual supply chain footprint near Mobile? I’m not even familiar with what the footprint is in Mirabel that you inherited from Bombardier but tell me how important it is to further increase the aerospace cluster size near your assembly sites, as opposed to relying on shipping.
Westermeier: This is an important thing that we are planning and doing together with local teams. As we increase the volume, as we increase the complex products we are making, like the A321, which is more complex than the A320. With the high volumes, there is a clear need for us to create an ecosystem around the plants that supports the ecosystem of suppliers, which supports the ramp-up. This is something we want to do, need to do, and are planning.
LNA: The Tianjin and Mobile plants are final assembly lines, which means that Airbus must ship either by air or by rail or by sea, in Mobile’s case the entire fuselages. Is it more efficient to start producing these large components in the United States someplace, presumably near Mobile, or in China, rather than going to the time lag and the expense of shipping from Europe?
Westermeier: My experience is no, as these big tools need a lot of non-recurring costs. You need to qualify the places, so it isn’t actually cheaper to change the global footprint. If we needed a change, if we needed to open up a triple source, we would look into making it a better footprint suited to our production plants. However, changing just for this is not a business case. It’s more a case that you need to have your suppliers close. You need to have your stock there so that if there is an issue you are flexible, you can change, you can repair something if somebody damages it so that you’re really proactive in enabling the ramp-up.
LNA: You mentioned artificial intelligence. You said very strongly that we would not be there at the rate without the tools you have put into place.
Westermeier: This is really important. We took a holistic approach to manage the complexity with the questionnaire, with our CRM tools, where we’re looking into the future. Otherwise, we would not be in a place to say that we believe the ramp-up is possible.
Scott. It isnt suprising this is an Airbus Focus. BA had been having “Shortage Meetings” every day for as long as I could remember. The idea of forecasting wasn’t there then, it was all reactionary. The ability to forecast may be there now. Looking at how disjointed the whole supply chain is, and will be for the immediate future, 70% confidence in your forecast is a miracle. AI is going to be an interesting tool, especially when the probability of an employee scrapping a part enters the picture. This will merge the quality reporting system into the picture and add requirements for parts based on the likelihood of the mechanic scrapping one. This will create instant focus on the places where immediate need for corrections are required based on factory disruption instead of some pencil pushers best guess.
Well done for the guys from across the pond, and also, while I may be a day late on this, Thanks for building a bird that floated like a rubber ducky in the Hudson. The robustness of the aircraft when it ditched contributed mightly to everyones survival. There was a big tip of the hat to AB in my BA Fuselage Planning Group that day as we understood just how well that 320 performed…..