In my opinion: Kate Schaefer, GM — commercial aircraft, Moog
Kate Schaefer has risen steadily through the ranks of aviation since joining AAR two decades ago. After eight years at the US MRO provider, she moved to PMA parts giant HEICO, where she was heavily involved in groundbreaking deals with many major airlines including British Airways when it first put its weight behind alternative parts in 2008. Now general manager for commercial aircraft at motion control specialist Moog, Schaefer is concentrating on the 787 and A350, on which Moog has exclusive responsibility for the flight control systems.
You’ve seen both sides of the PMA parts debate at first hand. Was it difficult to make the transition from a generic parts supplier to an original equipment manufacturer [OEM]?
KS: I was at HEICO for 10 years, during which time I was really involved in strategy. Now I’m with an OEM I feel the same way as before about competition: it’s a good thing and it’s good for the market as a whole because it challenges the old ways of doing things. At Moog we are really focused on listening to the airlines and aligning our strategy with what the airlines want. My job now as an OEM is to come up with a product offering that is so appealing to airlines that they choose to stay with us.
Moog’s technology spans a number of industries — how important is commercial aerospace to the group?
KS: Moog is a technology-driven company focused on high-precision motion control systems. The aerospace group makes up a little under half of the total revenue with the current approximate split within aerospace being 60 per cent military and 40 per cent commercial. With Moog’s strong position as the flight control systems provider on the 787 and A350, that split will gradually reverse over the coming years.
Within commercial aerospace at Moog, how do aftermarket sales compare to those for original equipment?
KS: It’s an odd split because we’re huge on the 787 and A350, so at the moment you’re going to see big growth on the OEM side and obviously the aftermarket is going to lag behind by a couple of years. It’s a different profile to some other OEMs, who are more established on older platforms.
The 787 and A350 are the first commercial platforms for which Moog is the exclusive supplier for the entire flight control system. What technological challenges does that entail?
KS: The primary actuation system has seen a vast increase in the use of advanced materials and a wider use of onboard unit electronics. In addition, the whole system has seen increased performance requirements as well as changes needed to cope with a much more advanced health monitoring system. However, it was more a case of amalgamating our knowledge and capabilities on individual systems into a complete system. Moog has been traditionally very strong on the military side, so from a technology point of view it wasn’t a huge step for us.
How is your aftermarket strategy for the two aircraft developing?
KS: Our number one focus right now is to make sure that our aftermarket strategy is aligned with what the airlines are telling us they want, so we are currently busy building the infrastructure, systems, and maintenance packages to support the airlines on those aircraft over the next 10 years. Last year, we commissioned a study by Aerostrategy to interview over 30 of the airlines taking delivery of the new aircraft to find out what they were looking for regarding future support. The results were astonishing and clearly suggest that we are about to experience a paradigm shift in the way that most airlines view inventory and maintenance.
So how do today’s airlines want to see their equipment supported?
KS: The aftermarket is changing dramatically; airlines are focusing heavily on return on invested capital and they don’t want to hold inventory. They expect their aftermarket providers to help by developing solutions that are better aligned with those requirements. The days where an OEM can expect to sell millions of dollars of initial provisioning on new platforms and then expect the maintenance work to show up at the door are long gone. In the future, airlines will expect much more sophisticated and collaborative solutions; interestingly that presents an amazing long-term opportunity for manufacturers that are willing to share risk and invest in the solutions that the airlines are interested in.
At Moog we launched 'MTS' ('Moog Total Support') about four months ago to support our airline customers on the 787 primarily, but also for legacy platforms as well. As part of that programme we are offering our pooling customers 24/7 inventory access to seven different pool locations placed strategically around the world, providing a service level that is impossible for a third party to surpass. We have combined the pool access with a whole suite of maintenance options that can be purchased on an a la carte basis, providing maximum flexibility and reducing the need for spares. I think the most important lessons that we have learned over the last couple of years here at Moog is that one size does not fit all and that it’s important to offer the airlines an array of options that focuses on reliability and instant parts availability.
As OEMs become more involved in the aftermarket, do you think they risk antagonising maintenance providers by withholding technical data and software?