Contract Airline Maintenance Reaches 60-Percent

Where is the center of US commercial passenger aircraft maintenance? Here's a hint: It's moving further and further to the south. Pretty soon, it may not be in the US anymore.

In fact, you'll have to go quite a bit further south to find out where companies like JetBlue and America West send their aircraft for insection and overhaul -- as far south as El Salvador. The Wall Street Journal reports more than half of all US flag aircraft in the civil fleet are now maintained by outside companies and many of them are altogether outside the US.

A sign of changing economic times, that's up from less than 35-percent sent to outside contractors just 15 years ago.

It's the heavy work that most often ends up being done outside an airline's own hangars. In addition to JetBlue and America West, other airlines like Southwest, Continental and bankrupt United send their aircraft to outside contractors. Executives at some of those airlines are quoted as saying the indeed have concerns about the quality of work performed at these outsourcing shops.

"We don’t want transient labor on our aircraft," Jim Sokel, Southwest’s vice president of maintenance and engineering, told the WSJ.

"The industry is losing its skills," said John Goglia, a former mechanic who recently stepped down after nine years as an NTSB member. He, too, was quoted in the Journal.

Not everyone in the industry is down on the idea of outsourcing major maintenance. United's VP of maintenance, Greg Hall, says the quality of the work done by outside shops is pretty good. "We give them a lot of oversight," he told the financial daily. "We give them training on our maintenance program and our tooling. We do frequent audits."

But in the final analysis, only supervisors in each of these third party shops have to be licensed by the FAA. But the Department of Transportation's Inspector General found in a recent investigation that the FAA is negligent in overseeing these contract shops. The Journal reports, while the FAA examined the practices of airline maintenance shops some 400 times in 2002, it only inspected seven contract shops during that same period of time.

Last year, the NTSB cited faulty maintenance at a contract shop as a contributing factor in the 2003 crash of a US Airways Beech 1900 that went down at Charlotte-Douglas International in North Carolina, killing all 21 people on board.

Since the DOT IG report, the FAA has started keeping closer tabs on contract maintenance shops. The FAA's chief of flight standards, James Ballough, told the Journal that his department now inspects 4,500 repair stations here in the US and 650 in other countries. While he said the FAA can't look over the shoulders of contract A&Ps, "there certainly is no degradation of safety due to outsourcing."

Face it. There's a strong economic incentive for airlines to send this work out of house and out of country. Even after obtaining contract concessions from their employees in hopes of staying in the air, legacy carriers are still paying up to $70 an hour for employee-driven maintenance. Team SAI, a consulting operation based in Colorado, says contract shops charge $50 an hour or less. In Central and South America, that cost goes way down -- as low as $20 an hour.

As economic pressure continues to mount on the legacy carriers, so will the pressure to outsource costly maintenance. And as it does, so will the challenge for the FAA to keep up.

FMI: www.faa.gov