New Fleets Could Generate 98 Million Terabytes of Data Annually by 2026 According to Oliver Wyman’s Annual MRO Survey

Industry Struggling on How to Incorporate Data into Aging Infrastructure

DALLAS, April 5, 2016 – The latest aircraft designs now entering fleets are equipped with technologies that can deliver unprecedented collection and transmission of data at the system and part level according to Oliver Wyman’s annual MRO (maintenance, repair, and overhaul) Survey Findings. The global fleet could generate upwards of 98 million terabytes of data annually by 2026 according to forecast estimates creating new opportunities for more prognostic maintenance. 

The survey, which was released at Aviation Week’s MRO Americas Conference, examines a variety of technology and innovation themes, including how operators, MROs, and OEMs (original equipment manufacturers) are adopting, utilizing, and investing in big data capabilities – particularly relating to aircraft health monitoring (AHM) and predictive maintenance (PM) systems.

“Many carriers are enjoying improved margins and also ramping up investments in new aircraft despite current low fuel costs and impact on new aircraft economics,” said Tim Hoyland, Oliver Wyman partner and report co-author. “These new next-gen aircraft provide a robust data stream which will enable operators and providers to better forecast, plan, and deploy aircraft assets. However, the industry faces a real disconnect on how to integrate this data into aging IT infrastructure at many airlines.  Until this is resolved, the real power of this data cannot be leveraged.”  

Key survey highlights include:

Although adoption of AHM and PM is growing, sophistication at the user level remains spotty and/or targeted at point solutions:

• Fifty six percent utilize AHM for some or all of their aircraft fleet. The most common application of AHM is engine condition monitoring (ECM), a long-established OEM offering. Use is less widespread within airframe and component maintenance applications, areas in which third-party or captive MROs are more common primary providers.

• Predictive maintenance adoption lags that of AHM at only 44 percent, with less than half of those respondents applying PM to all aircraft.

• Fifty-nine percent of airline respondents plan to restrict AHM use to small subsets of data, either directly or through a third party, rather than pursuing a broad or comprehensive approach. For those using PM, 83 percent focus on narrow subsets, while only one in five expect to apply predictive techniques to all available data.

• The business case for a wide-scale roll-out of big data solutions remains elusive for many respondents. While 63 percent cite reliability improvements from AHM and 30 percent for PM, roughly 1/3 of respondents or less are currently seeing hard dollar cost savings across engines, components and airframe maintenance costs.

• Additionally many carriers have other immediate technology priorities.  They report a great portion of their IT budget aligned to initiatives such as repair and maintenance of existing systems (29 percent), migration to new software (19 percent), building/improving inventory system (9 percent), introducing new hardware to enable front line operations, and other technology initiatives (24 percent).  According to respondents, only 8 percent of airline IT budgets are allotted to building/improving AHM or PM systems.

• Despite this, respondents said they plan to invest further in these technologies and expect them to become a core part of decision making in the future.

In terms of the aftermarket segments, the authors expect:

• OEMs to continue to press adoption, investing in understanding of the technology’s potential and advancing usage at airlines.
• Carriers to become more purposeful and outcome-oriented in their big data programs, engage a cross-section of stakeholders to understand and prioritize available data, and develop more robust business cases supporting greater adoption.
• Other providers, including MROs, consultancies, and IT firms, will search for sustainable niches in the value chain surrounding big data. This may include partnering or building in-house capability to package data-centric services – collection, analysis, reporting, decision support, and compliance – with traditional touch maintenance.

“The obvious challenge for carriers is a focused execution which produces tangible and demonstrable improvements in cost and reliability. For OEMs accelerating adoption and profitably monetizing investments in predictive maintenance will be a significant challenge,” says Chris Spafford, Oliver Wyman partner and report co-author.

To download the entire report, please click here.

About the MRO Survey
Going on its second decade, the annual MRO survey produced by Oliver Wyman is an industry standard for information about changing trends in the MRO sector. The survey queries leaders across the MRO industry, including top executives from airline operations, procurement and engineering departments, captive and independent maintenance providers, OEM aftermarket divisions, and financing and leasing professionals. Our respondents are overwhelmingly in C-suite and senior executive positions and represent a global cross section of the industry.

The MRO Survey findings also include forecast data from our 2016-2025 Fleet and MRO Market Forecast (see www.PlaneStats.com/betterinsight for more information about the forecast data).

Press contact:
Francine Minadeo
(212) 345-6417
francine.minadeo@oliverwyman.com