Is cryptocurrency a viable payment platform for aviation spare parts?

2021-11-19 / 2 min

It’s been slow coming, but finally, blockchain technologies are beginning to disrupt the aviation spare parts and maintenance industries. The aviation and aerospace industries are well known for their traditional methods of doing things and their reluctance to change – with good reason in many cases, safety being one of them – however, the benefits of digitalisation are now being realised by aviation companies seeking to improve their operational efficiency, especially in the spare parts marketplace.

Cryptocurrencies, as one branch of blockchain technologies, is being widely touted as the future method of payment for aircraft spare parts and repairs. But is that just a pipe dream, a possibility, or an idea that will eventually become a reality?

Already, blockchain technologies are offering insights into one area that is haemorrhaging money for the aviation industry – the manual collection of big data. Two sectors of aviation already heavily reliant on the collection of big data are MRO and spare parts. At present much of the information critical to keeping aircraft in the air is collected manually, both expensive and time-consuming processes.

However, blockchain can record the movement of spare parts every time a part is installed or removed from an aircraft, along with other information such as time in service, last inspection date, location, and even the records associated with the technicians who may have worked on repairs. It is even envisaged by some that these evolving technologies could lead to virtual 3D, AI, or AR blueprints of every aircraft, where every part, and all of its associated information, can be stored and retrieved as needed.

Companies like Locatory.com – a family member of Avia Solutions Group, and the number one aviation marketplace in Europe and the eastern hemisphere for aircraft spare parts and repair capabilities – is already contemplating the future for cryptocurrency payments as an integral element of the spare parts marketplace.

Toma Matutyte, Director of Sales and Marketing at Locatory.com believes that cryptocurrencies can transform the digital spare parts marketplace, but also realises that many players are still cautious about its onboarding. “There can be little doubt that blockchain technology will influence how aviation, and especially the spare parts marketplace will gather information. With that in mind,” says Matutyte, “it seems logical that cryptocurrencies are predominantly suitable to work in tandem with these new technologies as a means of instant payment for parts or services anywhere in the world. Any technology that improves the flow of parts, increases buyer confidence, and reduces wasteful practices has to be taken seriously.”

Cryptocurrencies have many advantages; transactions are quick and easy, their place in the blockchain cuts out the need for banks or other financial institutions, every transaction is recorded in a public list (the blockchain itself), and probably most importantly, cryptocurrencies are gaining in popularity and are now widely used as an instant payment method for all kinds of goods and services.

It’s also true that cryptocurrencies have their disadvantages; the irretrievable loss of digital wallets and their contents, the fluctuating value of bitcoins and other cryptocurrencies, the marketplace remains unregulated, and they are vulnerable to cyber-crime and scams.

All new practices, not just in the aviation industry, come with certain amounts of trepidation. However, the growth of cryptocurrencies already seems to be an unstoppable train and destined to become an integral part of the future aircraft spare parts and maintenance sectors.

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The secret afterlife of retired aircraft

2021-11-11 / 2 min

Around 94% of an aircraft can be reused or recycled at the end of its life. This could see fully functional cockpit equipment becoming a spare part for another aircraft or aluminum fuselage finding a new life as a keyring. Circular economy for aerospace and aviation sectors: redesign, repair, reuse, recycle, paving the runway to a more cost-effective, low-carbon economy. However, what happens to the parts that can’t find a new home?

Upcycling the parts — using old materials to make something new and different — has gained momentum in recent years. It has become a much more efficient marketplace as more companies have become socially and environmentally responsible. Access to retired aircraft materials used to be difficult, but in recent years, they have become more available.

Typically, at the end of airplanes lifecycle, the airline or owner may keep some of parts for reuse internally, some aircrafts may be converted into cargo planes and the remaining inventory is often sold.

Second life

Components (everything from cockpit instrumentation and the outer shell of the plane known as skin, to seats and food-service equipment) in good condition can be used to equip other planes or are recycled or upcycled into things like beverage cans, clothing, and home and office furnishings.

The average aircraft has about 800 to 1,000 parts that can be reused when it comes out of service. The largest assets, like the engine and landing gear, are often removed, repaired, tested, recertified and used in another aircraft in a carrier’s fleet. Aluminum, copper wiring and other precious metals go to recycling centers and back to the raw supply chain.

Repurposing parts

Many items are produced commercially, but unique uses abound: an old galley cart turned into a home bar, wings from an old Boeing 747 that form the roof of a private house, and first-class seats used as lounge chairs, cuff links in the shape of a wing rib made from the fuselage of a Pan Am Boeing 707.

Civil aircraft can bring as much economic benefit to its owners when it is retired as it does during the days it is busy flying people and cargo around the world. Over 90 % of an aircraft’s parts can be recycled, dismantling a plane can provide up to 6,000 parts.

Recycling aviation parts

An average commercial aircraft has an estimated 800 to 1,000 parts that can be recycled. The most valuable of these are the engine, landing gear, avionics and electronics. Once these components and parts are removed, overhauled, tested and recertified, they can be repurposed back into aviation. The remaining materials, including aluminum, copper, and various alloys can go to recycling facilities and returned to the raw material supply chain.

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