Since its launch in 2010, Satair’s Airbus Managed Inventory service (AMI) is now starting to become well-established in the market and having proved its worth is now finding ever stronger customer interest.
It is particularly popular in Asia-Pacific with airline customers such as Air Asia, Air Asia X and Thai Airways and strong with MROs such as Singapore Engineering Company, Lufthansa Technik Philippines, GAMECO in China, GMF AeroAsia in Indonesia and Sepang Aircraft Engineering in Kuala Lumpur.
In Latin America it operates with Ocean Air in Brazil, and Aeroman in El Salvador and has helped to start operations at Jetsmart in Chile, while in Europe it serves with Lufthansa Technik Sofia and also SR Technics in Zurich.
Michael Haupt, Head of Logistics Solutions and Support Management for Satair stated: “We have a good number of prospects for AMI and particularly in China where we see very good momentum.”
What is AMI?
Simply explained, AMI is a fee-based service offering that automatically replenishes customers’ frequently consumed inventories of low-value, non-repairable parts at their facilities. This is done through monitoring of consumption through messages which generate orders for replacement parts electronically and refill the stock according to agreed inventory levels. The bigger the turnover of parts, the lower the service fee and the scope of part numbers managed can be in the hundreds or thousands.
Michael added: “In many ways AMI was ahead of its time with its adoption of true e-connectivity which is even more needed now, and we are quite proud with that as it fits perfectly in today’s digitalized world. Not only for Airbus’ proprietary parts AMI is a perfect opportunity to automate procurement of expendables, allowing customers to forget about stock levels, re-ordering and transport.”
Satair has ramped up AMI slowly but continuously in line with customer demand and this organic growth allows the business to ensure that it has adequate back-office staffing to manage the service. As Michael adds: “It can be difficult to find 10 qualified people at one go. At the moment we have 10 AMI managers – 8 in Hamburg, one in Singapore and one in Washington.”
But it can take time for potential customers to decide outsourcing a critical part such as the expendable procurement – it needs trust and measurable performance. One Key Performance Indicator (KPI) for AMI is a guaranteed 95% on-site availability which Michael says is generally ‘met if not even exceeded.’
He adds: “Thanks to the AMI connection we know what is happening with regard to consumption data for the fleet in the market, which makes forecasting future needs much easier. We have good examples of being able to reduce inventories for customers.”
Even though most of these parts are relatively inexpensive, an industry average individual purchase order cost of between US$100 - $150 soon adds up to substantial overall costs which customers will seek to avoid. Automated ordering as in the AMI system gives real value to customers to reduce costs.
Where next for AMI?
One customer – Jetsmart in Chile having contracted for AMI initially has recently upgraded to an Integrated Material Services (IMS) deal and this could be a natural evolution for the business and for other bigger customers. On the cards, therefore, is a merging together of the AMI and Integrated Materials Services (IMS) teams to unlock potential synergies on team and system levels.
Michael concluded: “AMI is on course for growth. There are a huge number of spare parts and a huge geographical spread of Airbus customers and both the growing and ageing aircraft fleet need more maintenance that can easier be done with reliable supply services.”
If you would like to know more about AMI, please reach out to our global AMI team at firstname.lastname@example.org