The stiff competition witnessed between the airlines in the skies has long since spread to plane makers and their suppliers. The aviation industry in Germany finds itself under immense pricing pressure: 86 percent of firms describe it as their main challenge. Then there is the compulsion on companies to front up the development costs for aircraft construction. Those are the results presented by the Aviation Study 2015. In collaboration with the German Aerospace Industries Association (“BDLI”), the management consultancy firm Staufen surveyed more than 100 German aviation industry companies. Of all the issues troubling the sector, it is the problem of pricing pressure that looms uppermost. System suppliers are particularly affected by this. 92 percent of all companies are lamenting the huge strains brought on by the unforgiving price war. “The so-called Tier 1 companies are stuck in something of a price trap, because it is practically impossible for them to pass on these costs to their suppliers”, says Harald Knoke, head of the Aviation unit at Staufen. “Companies are also finding themselves forced to provide fixed-price quotes that frequently are supposed to remain binding even in the face of subsequent configuration changes.” These businesses are faced with yet another major problem. Aircraft makers are increasingly passing the responsibility for complete modules and systems onto their suppliers. The main implication for all system suppliers is clear – they are being forced to pre-finance the development costs for these complete systems. This was named as a main challenge by two out of three companies surveyed. The some 500 enterprises active in the German aviation industry are therefore working towards optimising their processes. They are seeking to improve their price efficiency, become more flexible and work faster. “But our study shows that numerous suppliers are failing to do so with the necessary rigour. For example, every second company has currently made the decision not to implement measures designed to arrange their value-creation chains more efficiently”, says the aviation expert from Staufen. “A misjudgement, because this is the only way to retain development and production in Germany over the long term.” About the survey: The “Aviation Study 2015 – managing global value-creation chains” is based on a survey conducted by the consulting firm Staufen AG in partnership with the German Aerospace Industries Association (“BDLI”). A total of 103 managers participated from all areas of the German aviation industry: aircraft manufacturers (OEM = Original Equipment Manufacturer), module and parts suppliers (tier 1, tier 2) as well as enterprises in the service sector (MRO = Maintenance, Repair, Overhaul). They expressed their thoughts on the current situation and their expectations for the coming years. Download STAUFEN. Aviation-Study 2015 Award and innovations forum for GERMAN INDUSTRY: At the GERMAN INDUSTRY innovations forum in Stuttgart on 3 and 4 November, experts from companies and science show how medium-sized companies can make new products, services or business models ready for the market in a better and faster way. At the same time the “GERMAN INDUSTRY Prize for Innovation” will be awarded for the first time. Outstanding, application-related innovations from medium-sized companies will receive awards. Winfried Kretschmann, Prime Minister of Baden-Württemberg, is the patron. For more information about the event, please go to: www.inno2015.de
