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Why do transitions go wrong and how to do it right

Updated: Mar 28




In recent years the number of aircraft transitions have skyrocketed; many leased airliners have been repossessed and are assigned to new homes, early returns have been agreed, return conditions have been renegotiated, etc.

Aircraft are sold in different conditions; for teardown, as-is-where-is, import and exports from and to different national or federal aviation agency jurisdictions.


In other words; there is no standard transition. Most of them are different technically and commercially.

A common fact is that rarely transitions run according plan. On time deliveries are extremely rare and on time deliveries to the agreed technical standards are even rarer.


In most cases the technical aspects of transitions are the stumbling blocks to on-time on budget transitions. This is generally not well understood by people not involved in the technical side of transitions, for good reasons.

Below are a number of common elements that are detrimental to smooth transitions:


  1. Discrepancies or disputes about the standards of technical records

  2. Discrepancies or disputes about physical condition of the aircraft.

  3. Planning discrepancies with MRO's conducting the delivery checks, in many cases resulting from scope creep, work pack agreement and reparation issues.

  4. Animosity between parties; differences of opinion, personality clashes

  5. Hidden agenda's; motives that can not be talked about or need to stay below the surface for different reasons.

  6. Project organisation; teams, number of members, level of involvement, leadership style, ability to focus, geographic location

Below I will be elaborating on the different element mentioned above.


Ad 1.Technical records review

Standards of technical records; in recent, prudently drawn up, contracts, there is a list of documents that will need to be produced in preparation to accepting and delivering the aircraft.IATA has published a helpful document that addresses many elements of aircraft leases in a generic form (including a section pertinent to technical records), however not all guidance is implemented in all lease- or purchase agreements.

When a leased aircraft has not been regularly audited or pre-buy inspected, by the appropriate depth, review of technical records is a Herculean task for airliner type (Part 25) aircraft and is very time consuming. Literally thousands of documents need to be reviewed.

Timely preparation and project start is key and can be phased, beginning with permanent records; modifications, repairs, configuration documents like flammability files, avionics inventories, LOPA and emergency equipment layouts, engine configurations, Airworthiness Directives (AD's), maintenance history, flight logs.

This can be started at any point in time, later to be followed up by superseding records like AD's, Repetitive task status, components, life limited components, hard time components and on condition components.

In these review processes, many differences of opinion can arise. However, opinions alone are not reasons to make demands. The required standard or records, if not stipulated in a lease/purchase agreement is legality. We have seen many records that were not the clearest, best laid out but they were legal, hence acceptable.



Ad.2 Physical condition of the aircraft

Again; a subject always good for bitter contention that many times result in delivery delays, excessive costs for the seller/lessor in turn for little benefit for all parties.

Usually the physical condition of the aircraft is described in detail in the delivery conditions of the agreement. However, there is still plenty wiggle room for discussion/contention.

In particular cabin cosmetics is an area where "fair wear & tear" can be disputed at length and make a delivery slide.

Often this expresses itself in a dance of dominance of two inspectors at opposing sides of the table that will. not. budge., while the non technical members of the delivery team are impatient spectators and project managers are scratching their heads on how to make people finally agree without offending anyone.

Other scenario's are that inspectors are trying to justify their own existence by raising as many items as they possibly can, drawing up monsters of open items lists containing hundreds of perceived discrepancies that after long deliberation and discussions will evaporate, only having caused delays for no benefits to anyone. We call this speedwriting contests.

An experienced and competent inspector knows where to look and can make an accurate assessment in a limited amount of time. given his level of accessibility.

Our experience is that two weeks full time inspection should be sufficient for a competent inspector to raise the relevant issues on the aircraft.

It is important to provide inspectors sufficient time to conduct their inspections for them to be comfortable to have an aircraft that complies with delivery conditions, yet contain the time of inspections to a reasonable level in order to ensure that follow up can be adequately maintained without jeopardising progress.

All findings should be briefed and be assessed against publications like Structural Repair Manuals, Maintenance Manuals, Component Manuals or Service Bulletins and so on.

Commonly agreed dispositions should be then transferred over to the MRO for actioning.

Important to note that blindly transferring findings without vetting for validity will generate excessive paperwork without technical relevance for the MRO and can result in reluctance or flat out refusal to raise the issues.

Strict adherence to and common understanding of the delivery conditions are imperative and should be supported by both parties.



Ad.3 Planning issues

For Part 25 (large) aircraft transitions, planning implies a certain degree of complexity.

Especially today with a buyers market, there is commercial pressure to compress timelines and get aircraft delivered in very short time lines. Consequently, rarely are aircraft delivered according the original project planning. Processes take the time they require.

In general, there are phases that essential. Key is to not skip them in order to deliver on time, on budget and on technical standard.

  • Preparation and agreement on work pack content, delivery configuration, MRO and third party selection, such as engine shops, Design Organisations (DOA) for modification development selection and time lines. Team member assignments and other provisions.

  • Agreement on MRO and consultancy budgets, logistics arrangements and engineering support budgets. Agreement on MRO time lines.

  • Induction of the aircraft into the MRO, Assignment of customer inspection slots. Transfer of customer finding dispositions. Progress reporting and meetings.

  • Delivery and acceptance, including ground check and demo flight and subsequent Engine Borescope Inspections (BSI), aircraft inventory checks and fly away/ferry.

Key is to draw up a detailed planning, preferably a Gantt chart and a protocol. This gives all parties guidance and predictability

Mutual sign off on every step in the protocol is a token of progress and commitment to advance. Below is an example of a protocol.


Aircraft acceptance protocol
.pdf
Download PDF • 74KB


Ad.4 Animosity between parties

In a number of cases there will be animosity between persons or parties

This can severely jeopardise progress and can potentially lead to excessive costs, i.e. when two inspectors try to be the smartest and snag excessive number of items or when records inspectors make extreme demands to standards or records that can not be resolved.

We have seen it all in 20 years of transitions.

This animosity usually stems from mistrust and fear of being caught on missed issues.

It is imperative to have an open mind and take disagreements for what they are; disagreements, not personal disqualifications or hiding or denial of issues.

It is also important that project management leads by example and emphasised that stems are just executing an agreement draw up by other people.

Disagreements need to be addressed and, if not resolvable, escalated to a higher level which supports the final resolution. Escalation of decisions should be encouraged but not imposed.

Decisions need to be taken at appropriate levels; for example an airline inspector can not decide by himself that a ship set of passenger seats are to be replaced on cosmetics, that is a higher level decision. In general cabin items have potentially significant impact on progress; parts lead times.


Ad.5 Hidden agenda's

Anyone having been involved in transition projects can relate to hidden agenda's and subjects that can not be discussed.

Usually this is imposed from commercial and financial departments by fear of exposure.

Examples of hidden agenda's are:

  • Dragging a project out in order to cash late delivery fees.

  • Raise excessive technical issues (with more or less technical relevance) in order to get monetary compensation

  • Demand standards of technical records in order to get monetary compensation.

  • Raise a number of issues that are not directly resolvable in order to delay delivery until a more convenient point in time

  • Withhold information in order to limit review time to a point where any issue will jeopardise successful completion of the project

Although these issues are usually highly sensitive, in our opinions it is important to raise them if it is suspected that they are actually playing a role.

It takes some courage to address these suspicions and will mostly be met with virulent denial, bit it sends a signal to the other party.

That signal is telling them that there is awareness but it also opens the door to a more constructive dialogue. A dialogue that is about the reals issues instead of being covered under technical talk. Thus it allows non technical people to participate in a resolution which can enhance progress.



Ad. 6 Project organisation

As mentioned earlier; a transition of a large aircraft has some complexity to it.

The amount of technical records to be reviewed can mount into the thousands.

To expect to present this to a customer for a quick review after lease or purchase signature is an illusion. Generally aircraft are pre audited and inspected before Letter Of Intent (LOI) signature.

This is usually (not always) done when an aircraft is in operation.

This means part of the records are fluid and will be superseded; focus should be on permanent records, like repairs, modifications, Supplemental Type Certificates (STC) and current Aproved Maintenance Program (AMP), factory delivery records.

As delivering party, preparation on presentability of these records should be started as early as possible. At this time a time line for records presentation should be provided and agreed upon.

At the same time delivery work pack should be drawn up that ensures compliance with delivery conditions and importantly, agreed upon with the customer.

MRO's and third party service providers, such as engine- and landing gear shops, DOA's, Parts suppliers, paint shops should be selected and contracted at the right time slots. Gantt charts will be a powerful tool to to visualise this in sufficient detail. Again involvement and agreement from the customer is required to get support for the plan.

This plan should contain detail like technical acceptance, delivery, registration and time of transfer. log book closure, etc. These milestones should be included in a protocol which would make the process predictable. Sample above downloadable. Protocol is to be agreed and committed to by both parties.


MRO selection and involvement is often underestimated, even overlooked. It is imperative that work packs are compiled and agreed upon before submitted to MRO's, engine shops, DOA's etc. Their costs and lead time are pacing items so involvement at an early stage is crucial. Both for budgeting as for delivery schedule.


An often unexpected major impediment is engine reject due to BSI findings. Unless engines are due to be shopped before delivery, it is worthwhile to borescope them at or before induction into a delivery check, even if not contractually required. A BSI reject after a demo flight just before delivery is a major head scratcher. Worthwhile to be proactive and give yourself time to resolve before a delivery comes to a grinding halt.


In addition to the above, human resources need to be assigned to take care of all elements of a project and progress must e monitored and finetuning applied.

On the practical side of project organisation, decision levels should be established; who can sign for what. Distribution of meeting minutes, etc.


IATA has published a document providing guidance for lease management . This can be a useful tool in order to structure and organise transitions although there is no one size fits all



ac-leases-4th-edition
.pdf
Download PDF • 2.41MB

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