AVIA5005 S22010 Assignment 2 IMWeerasinghe 3317993

The University of New South Wales
Department of Aviation
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AVIA 5005 – Airline Operations Management
2010 Semester 2
Assignment 2
2
Indunil M Weerasinghe – 3317993
The Evolution of Aircraft Maintenance, and its Impact

on Airline Performance
Discuss aircraft maintenance and how it has changed over time. Discuss the impact which
aircraft maintenance can have on the airline’s operational performance, aircraft utilisation
and financial results.
PROGRAM: MSC TECH IN AVIATION INDUSTRY MANAGEMENT

INSTITUTION : UNIVERSITY OF NEW SOUTH WALES
COURSE : AVIA5005 – AIRLINE OPERATIONS MANAGEMENT

COURSE COORDINATOR: RODGER ROBERTSON
ASSIGNMENT : 2
TH
DATE : 26 SEPTEMBER 2010
WORD COUNT: 4,700
STUDENT NAME: INDUNIL M WEERASINGHE

STUDENT NUMBER: 3317993
2010 Semester 2
Assignment 2
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Table of Contents
1. AIM .................................................................................................................................................................................. 4
2. INTRODUCTION ................................................................................................................................................................ 4
3. THE EVOLUTION OF AIRCRAFT MAINTENANCE ............................................................................................................... 5
3.1 HARD-TIME MAINTENANCE .................................................................................................................................... 5
3.2 ON-CONDITION / CONDITION-BASED MONITORING MAINTENANCE .................................................................... 5
3.3 THE MAINTENANCE STEERING GROUP ................................................................................................................... 7
3.4 THE MSG-3 BASED APPROACH TO MAINTENANCE ................................................................................................. 8
3.5 THE EVOLUTION OF AIRCRAFT MAINTENANCE ...................................................................................................... 9
4. IMPACT OF MAINTENANCE ON AIRLINE PERFORMANCE ................................................................................................ 9
4.1 OPERATIONAL PERFORMANCE ............................................................................................................................. 10
4.2 AIRCRAFT AVAILABILITY ........................................................................................................................................ 11
4.3 FINANCIAL PERFORMANCE ................................................................................................................................... 12
5. CONCLUSION ................................................................................................................................................................. 12
6. ABBREVIATIONS ............................................................................................................................................................. 14
7. REFERENCES ................................................................................................................................................................... 15
2010 Semester 2
Assignment 2
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1. AIM
This report discusses the evolution of aircraft maintenance and its impact on airline performance. The report is structured
into two separate discussions:
1. An historical account of the evolution of maintenance and the philosophies that drove this process;
2. An investigation into the impact of aircraft maintenance operations on airline performance.
The two discussions culminate in demonstrating that improvements in maintenance cost and efficiency stemming from
the evolution maintenance philosophies have a beneficial impact on airline performance.
2. INTRODUCTION
In December of 1903, the Wright brothers’ Wright Flyer became “the first powered, heavier-than-air machine to achieve
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controlled, sustained flight with a pilot aboard" . It flew a distance of 37m with a single pilot at its helm . In a little more
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than a century, these humble beginnings have yielded a US$370 billion industry and facilitated socio-economic advances
that would have surpassed the wildest dreams of the Wright brothers. Consider for example the Airbus A380, an aircraft
with the technological capability to
transport 850 passengers over a distance
of 15,000km. In terms of modern day
aircraft performance metrics, this
equates to a capacity of almost 13 million
ASK’s as opposed to the Wright Flyer’s
37m, single pilot journey. This represents
a 350 billion percentage increase over a
single century. These advances (see
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graph , left) have been accompanied by
developments in the maintenance
required to sustain these new
technologies. The first part of this report
will explore the evolution of the approach
taken to maintainance, that is, the
transition from traditional “hard-time”
philosophies to the current “reliability centred” approach.
The global socio-economic structure has become increasingly reliant on the aviation industry. The ability to traverse the
globe within a matter of hours has catalysed developments in trade, commerce, tourism and a multitude of other
industries. ICAO estimates from 1998 data indicate that the industry itself being worth US$370 billion contributed a
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further US$1,360 billion to the world economy! Nonetheless, airlines themselves are facing a challenging economic
environment.
Regulation designed to protect the sovreignty of national airspaces yielded a highly regulated industry. However,
increasing liberalisation has been taking place, starting from US President Jimmy Carter’s Airline Deregulation Act of 1978.
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This move towards free-market economics has increased competition and put downward pressures on yield.
Management of costs is therefore paramount to the survival of an airline. The maintenance cost of an airline is typically
1
Wikipedia; 2010; Wright Flyer; http://en.wikipedia.org/wiki/Wright_Flyer viewed 25th September 2010
2
NASM website; 2010; Milestones of Flight; http://www.nasm.si.edu/exhibitions/gal100/wright1903.html viewed on 25th September
2010
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Heracleous, Wirtz, and Pangarkar; 2006; Flying High in a Competitive Industry – Cost Effective Service Excellence at Singapore Airlines;
McGraw-Hill Education
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Graph compiled based on data researched through http://en.wikipedia.org. Stats for passenger capacity and range used in the
calculation of ASK’s were based on the largest configuration (by passenger numbers) for that aircraft type.
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International Air Transport Association; 2009; Annual Report
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estimated at 8% to 15% of the airline’s overall operating cost profile. The second part of this report will discuss how
maintenance operations can contribute to the airline’s bottom line through both cost efficiency of operations and as a
driver of airline operational performance
3. THE EVOLUTION OF AIRCRAFT MAINTENANCE

The basic premise within maintenance is to ensure the safe operations of the aircraft, that is:
 to ensure the inherent levels of safety of a given aircraft are achieved in operation
 to restore the inherent levels of safety where deterioration has occurred
Early aircraft were technologically simple machines. Consider the Wright Flyer: a spruce, ash, and muslin construction
weighing in at just 274kg and powered by a four-cylinder, 12hp engine. The maintenance requirements derived for such
early aircraft were based on thorough knowledge of the design, intuition, and experience. The intuitive philosophy that
emerged as aviation quickly developed and commercialised was to consider ascertain the useful life of the various
components, and either replace, repair, or overhaul these items periodically. This approach could best be described as a
“hard-time” maintenance philosophy.
3.1 HARD-TIME MAINTENANCE
Hard-time maintenance could be best described as the “scheduled removal of all units of an item before some
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specified maximum permissible age limit” . Any given component would have a useful life, constrained by its design
criteria and operational environment. Therefore, at some interval prior to the anticipated failure of a component, it is
replaced, repaired, or overhauled.
Although this maintenance philosophy makes intuitive sense, it makes the basic assumption that component failure is
predictable to a high degree of accuracy. In other words, the mortality rate of a design is dependent on its age (see
graph, right). However, this assumption was
Recommended
found to be simplistic, with only 6% of
components displaying such mortality rates (see Life Limit
10 Mortality
graph , below). A further 5% display a linear
Rate
relationship between age and mortality, but with
no “obvious” age at which component repair or
overhaul could be recommended.
In effect, this lack of increase in mortality with Age

age means that hard-time philosophies as
applied to 89% of components on an aircraft were ineffectual. That is, with the basic assumption undermined, airlines
were carrying out maintenance activities that, despite detracting from the bottom line, added little or no value to the
maintenance objective of ensuring safe operations. This realisation gave birth to the concept of “on-condition”
maintenance.
3.2 ON-CONDITION / CONDITION-BASED MONITORING MAINTENANCE
The on-condition / condition-based monitoring (OCCM) maintenance philosophy emerged to address the 89% of
components that were inadequately addressed by hard-time based life limits. The basic premise is to monitor a
component and evaluate the need to replace, repair, or overhaul it based on its condition. A simple example would be
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8
Transport Studies Group, University of Westminster, London; 2008; Dynamic Cost Indexing - Aircraft Maintenance – Marginal Delay
Cost; EUROCONTROL Programme CARE INO III
9 rd
Gdalevitch; 2008; MSG-3, The Intelligent Maintenance; http://www.amtonline.com/online/printer.jsp?id=1039 viewed 23
September 2010; Aircraft Maintenance Technology online
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Robertson & Forsyth; 2010; Engineering and Maintenance Resources; AVIA5005 Course Notes; University of New South Wales
2010 Semester 2
Assignment 2
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that of the brake assembly of a modern day commercial aircraft. Rather than replacing the brake assembly at a fixed
interval, it is typically inspected by maintenance crew during the pre-departure inspections. A wear indicator will
display the remaining useful life of the brake, which allows the maintenance crew to decide the optimum point at
which to replace the assembly and route the old unit to the workshop for a full overhaul.
This report treats on-condtion and condition-based monitoring as a single maintenance philosophy, in-line with
standard industry practice. However, it is important to note (for the purist at least) the subtle yet important
conceptual difference between the two. Strictly speaking, “on-condition” maintenance implies that a component is
simply allowed to operate until such time as it has failed. “Condition-based monitoring” calls for periodic testing and
inspection to be carried out to determine when a component has deteriorated such that failure is imminent. It is
intuitive that on-condition components are inevitably those whose failure has no direct impact on safety (for example,
most galley equipment like ovens, coffee makers, chillers etc would fall under this category). Nonetheless, the two
philosophies are in effect two sides of the same coin.
The advantages of the OCCM philosophy to the industry are several-fold. Primarily, it allows for more effective
maintenance to be carried out on the aircraft, providing a more concise, methodical means of ensuring the inherent
levels of safety. Effective maintenance also equates to less maintenance, and this enables airlines to minimise its
operational costs and increases the time available for revenue flights. The magnitude of cost saving is illustrated by
Hocking’s 1995 estimate that Qantas was saving
A$300 million in maintenance costs annually by
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the use of OCCM maintenance practices .
Given the demonstrated success of OCCM, most

OEM’s now design their equipment with
condition-based monitoring in mind. Aircraft
engines are a prime example of this. Historically,
engines were constructed with minimal access of
inspections and replacement of components and
modules. This in effect meant that, once an
engine was inducted into an overhaul workshop,
even those components and modules with useful
life remaining would be replaced. However,
modern engines provide for internal inspections
such as boroscope inspections to monitor and
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detect early signs of fatigue and erosion .
Further, magnetic chip detectors provide cheap,
easy, and quick means of detecting early signs of
bearing failure. Modern day avionics allow both
pilots and engineers to monitor and detect the
development of high vibrations and a multitude
of other parameters such as speed of rotation,
exhaust gas temperatures, and fuel flow. In short,
a host of diagnostic techniques are now available
which allow an airline to operate its engines for
longer and replace few components and modules
during an overhaul.
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Hocking; 1995; Condition Based Monitoring; Qantas
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OCCM maintenance has been widely adopted by

OEM’s and airlines. Gdalevitch (2008) succinctly
summarises the benefits to the industry as “higher
reliability and safety, and above all, tremendous
savings to the operators”. In fact, maintenance costs
have “depreciated” from 30% of operating cost in 1960 to
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just 16% in the 1990’s (see graph , left) whilst
simultaneously improving the inherent levels of
safety.
However, it is important to realise that the

fundamental premise upon which OCCM
maintenance success depends on are the condition-
based monitoring activities. For example, the means
and access to conduct boroscope inspections on an engine need to be accompanied by a program of inspections,
carefully scheduled to ensure emergent failures are detected in a timely manner. This realisation leads well into the
concept of the “maintenance program” which is developed through the Maintenance Steering Group process.
3.3 THE MAINTENANCE STEERING GROUP
The design of the Boeing 747 in the 1960’s proved to be an industry game-changer, not just in terms of what its
payload-range capabilities would facilitate commercially, but in terms of how the industry would approach aircraft
maintenance in years to come. Given the unprecedented scale of technology on the 747, industry players realised that
a systematic approach needed to be adopted in designing an effective maintenance program. This need was further
underscored by the application of OCCM philosophies which had reduced the number of hard-time components on
the 747 to just 10.
The FAA, Boeing, and other major industry players such as the US Navy and several operators entered into a
consultive, collaborative process to design a systemic, methodical approach to the design of the 747 maintenance
program. This group, known as the Maintenance Steering Group (MSG) yielded a “decision-logic process for
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determining by reliability principles the initial scheduled maintenance requirements for new aircraft and/or engines” .
Following the conceptual success of the MSG process, several revisions have followed, with the current version being
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MSG-3, which though adopted in the 1980’s has itself been revised several times, most recently in 2007 (see
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timeline , below).
The Evolutionary Development of MSG-3

Maintenance Steering European Maintenance Maintenance Steering
Group (MSG) 1 System Guide (EMSG) Group (MSG) 3
1960 1968 1970 1972 1978 1980 1988 1993 ... 2007
FAA/Industry Steering Maintenance Steering Reliability Centred Maintenance Steering

Reliability Program Group (MSG) 2 Maintenance (RCM) Group (MSG) 3 revisions
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Aviation Glossary; Maintenance Steering Group; http://aviationglossary.com/airline-definition/maintenance-steering-group-3-msg-3/
rd
viewed 23 September 2010
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Aviation Glossary; Maintenance Steering Group; http://aviationglossary.com/airline-definition/maintenance-steering-group-3-msg-3/
rd
viewed 23 September 2010
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Diagram adapted from: Gdalevitch; 2008; MSG-3, The Intelligent Maintenance;
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http://www.amtonline.com/online/printer.jsp?id=1039 viewed 23 September 2010; Aircraft Maintenance Technology online
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3.4 THE MSG-3 BASED APPROACH TO MAINTENANCE
MSG-3 (as with its predecessors) provides a decision-logic that provides for a systemic approach to aircraft
maintenance programs. It is important to consider MSG-3 in the context of OCCM maintenance as the program
provides for a schedule of testing and inspections that are designed to detect failures (on-condition) and monitor
deterioration (condition-based monitoring).
Perhaps the most fundamental change in conceptual thinking brought about by the MSG-3 process was a top-down,
functional approach to maintenance. The decision logic looks at aircraft systems and their functions rather than
components and raises the question of functional failure as opposed to component failure. The functional failure is
then addressed by a maintenance task at the highest level possible. This approach enables a leaner but nonetheless
more effective maintenance program than even the OCCM approach yielded.
The MSG-3 process therefore begins at the design level of the aircraft. Each significant sub-system is identified, being
either a Maintenance Significant Item (MSI) for aircraft systems or Structurally Significant Item (SSI) for aircraft
structure. The functional purpose of each MSI and SSI is then identified, and the failure of this function is located at
the highest possible level in the system. Based on the failure mode (see below for further discussion) a task is selected
to be incorporated into the maintenance program which will address the potential failure. The process inherently
identifies that any maintenance done on sub-assemblies would not provide further protection against the failure of
this particular function and therefore would be redundant.
The task selection considers the failure mode of the function. For example, for MSI’s five failure effect categories
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(FEC’s) are identified in MSG-3 :
i. FEC 5: Evident Safety Effects
ii. FEC 6: Evident Operational Effects
iii. FEC 7: Evident Economic Effects
iv. FEC 8: Hidden Function Safety Effects
v. FEC 9: Hidden Function Non-Safety Effects
A critical analysis of the failure and its related FEC would yield a series of applicable maintenance tasks, typically one
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of :
1. Lubrication/Servicing Task: to maintain inherent operating levels
2. Operational/Visual Check: failure finding for hidden (safety and non-safety) FEC’s
3. Inspection/Functional Check: to detect potential and/or actual failures
4. Restoration: repair or overhaul on or before a specified age limit
5. Discard: on or before a specified life limit
The tasks above are listed in increasing order of cost to the operator. Thus the
selection of an applicable task based on the MSG-3 decision logic (see
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illustration , right) yields not only an effective, lean program in terms of
maintenance activity but one that is also optimised for cost.
SSI’s are approached by the MSG-3 process in a similarly systemic and

methodical manner. The failure modes of structural components are determined
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based on the deterioration characteristics, primarily being :
- Fatigue Damage (FD)
- Environmental Deterioration (ED)
- Accidental Damage (AD)
for metallic structures, and:
- Ageing Deterioration
- Accidental Damage
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Airbus; March 2009; Maintenance Review Board Report – Airbus A318/A319/A320/A321; Revision 14
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for non-metallic structures. Combined with an analysis of material properties and operational parameters, the MSG-3
process identifies an inspection program to detect early failures of SSI’s due to any of the above causes of
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deterioration. The inspection program will typically consist of :
1. General Visual Inspection (GVI)
2. Detailed Inspection (DI)
3. Special Detailed Inspection (SDI)
As with the MSI tasks, the above are listed in increasing order of cost to the operator, allowing the maintenance
program to be, once again, optimised for efficiency in both maintenance and cost.
The MSG-3 methodology further provides for Zonal Inspections, Corrosion Prevention and Control Programs, and
Sampling. The fundamental philosophical approach to each of these is similar to that of the analysis and selection of
MSI and SSI tasks.
3.5 THE EVOLUTION OF AIRCRAFT MAINTENANCE
The above discussions give an overview the evolutionary process through which aircraft maintenance philosophies
and practices have developed. Fundamentally, the hard-time approach adopted by aviation pioneers was found to fall
short in context of the technological advances made since the Wright Flyer’s first flight of just 37m. This led to the
development of on-condition and condition-based monitoring during the 1960’s which culminated in the
establishment and development of the Maintenance Steering Group. The cumulative effect has been, in the words of
Gdalevitch (2008): “higher reliability and safety, and above all, tremendous savings to the operators”. Having
established these advantages, the next section of this report will discuss their relevance to the operational and
financial performance of an airline.
4. IMPACT OF MAINTENANCE ON AIRLINE PERFORMANCE

An airline’s basic product is its schedule, that is, its network of destinations and operating frequencies. In simplest of
terms, the production of this saleable schedule is the combined effort of the maintenance engineer and pilot. The
maintenance operations are therefore of vital importance to an airline to ensure the fleet is airworthy and available to
Flight Operations to meet the required schedule of operations. This is illustrated in the “Precision Timing Schedule” show
below, whereby engineering, servicing, and fuelling activities typically come under the purview of maintenance
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operations. The cost of providing these services typically amounting to an estimated at 8% to 15% of the airline’s
overall operating cost profile.
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The maintenance operations therefore impact on several aspects of the airline’s performance, namely:
1. Operational performance – being the punctual departure of flights
2. Aircraft availability – being the provision of airworthy aircraft to meet the commercial schedule
3. Financial performance – being the cost efficient provision of maintenance services
This report will now explore the impact of the maintenance operations on each aspect.
4.1 OPERATIONAL PERFORMANCE
The key metric of operational performance for an airline operating scheduled flights is punctuality, typically referred
to as “dispatch” or “operational” reliability. Passengers expect on-time departures, so much so that for some –
especially those high-yield business travellers – departure times are a key driver in deciding what airline / flight to fly
on. Poor punctuality can therefore erode an airline’s customer base over a period of time and threaten future
revenues and yields, a dangerous situation for any airline to be in, especially as competition increases in the face of
industry de-regulation.
Notwithstanding the long-term performance, even an

airline perceived by the customer as being punctual does
suffer from occasional delays. Consumer protection laws
are increasingly calling for tighter passenger
compensation, where a single delay could incur
significant compensation and accommodation costs to
be borne by the airline. Delays also typically increase
ground handling costs, slot penalties, and even increased
fuel burn as pilots attempt to make up for lost time. In
fact, it is estimated that the direct cost of delays amount
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to 0.6% to 2.9% of an airline’s revenue , not considering
the loss of future revenue as disgruntled passengers turn
to other airlines.
It is not surprising therefore that a study commissioned

by Booz-Allen & Hamilton shows a clear correlation
between punctuality performance and profitability (see
25
graph , left), which serves to further underscore the importance an efficient maintenance operation to an airline’s
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performance. This is usually measured in terms of “technical dispatch reliability”. The graphs below are derived from
in-service operational performance of the Airbus A330 / A340 family of aircraft and indicate the effect of daily average
utilisation (DAU) and average flight duration (AFD) on the technical dispatch reliability of the aircraft.
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Niehues et al; Punctuality: How Airlines can Improve On-Time Performance; 2001; Booz-Allen & Hamilton
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Niehues et al; Punctuality: How Airlines can Improve On-Time Performance; 2001; Booz-Allen & Hamilton
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Compiled based on data from Airbus World Online
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It is interesting to note that although clear clusters of data are apparent, there is no linear correlation between the
parameters. It has to be noted however that there are no airlines with poor punctuality at the lower end of both the
DAU and AFD scales. However, those operators with poor punctuality are by no means outliers, with many airlines
achieving near perfect dispatch reliabilities whilst maintaining similar or even higher utilisation and flight durations
(illustrated in red).
The differences in operations of the technical dispatch reliabilities could be due to commercial scheduling flexibilities,
inherent design reliabilities, or efficiency in maintenance operations. However, the first two can be ruled out. Given
that operators with high DAU’s and AFD’s achieve high technical dispatch reliabilities, this implies that diminished
commercial scheduling flexibilities can be overcome, at least to some extent. Given that the above data is based on a
single family of aircraft, differences in reliability due to aircraft design and maintenance philosophies can also be
eliminated.
The above analysis therefore suggests that efficiency in maintenance operations is a key driver of technical dispatch
reliability. On this particular family of aircraft, a difference of almost 6% is noted between the highest and lowest
performing operators. As already discussed earlier, this difference in operational performance can provide the more
punctual airlines with a competitive edge that translates directly into higher profit margins.
4.2 AIRCRAFT AVAILABILITY
Aircraft availability is measured in terms of average fleet utilisation, usually expressed in either flying or block hours
(FH or BH) per aircraft per day (DAU). Improved availability provides the airline increased opportunity to generate
revenues or conversely, meet its scheduling requirements with fewer aircraft. Given the high ownership cost of a
modern day commercial aircraft, even incremental improvements in aircraft availability can yield a direct impact on an
airline’s financial performance. Let us consider a hypothetical airline to illustrate this:
Airline X operates a fleet of Airbus A320’s with a list price of US$81.4 million each. The airline’s commercial
schedule requires a utilization of 110 FH per day across the fleet. At 10 FH per day per aircraft, the airline requires
a fleet of 11 aircraft.
However, if the DAU could be increased by a single FH per day per aircraft, the airline would require just 10
aircraft.
The potential cost saving in this scenario is:
Monthly lease cost = 0.75% of price

:. Savings per year = 0.0075 * $81.4m * 12
= $7.3m per year
An intuitive assumption would be that with increased maintenance efficiency, aircraft would spend less time on the
ground, thereby driving up aircraft availability. Empirical evidence can be found to support this. Consider the data
presented below, compiled from US DOT Form 41 data from 2005 – 2009 as published by the MIT’s Airline Data
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Project . The analysis utilises “maintenance employees per aircraft” (adjusted to account for outsourced
maintenance) as an indicator of the efficiency of maintenance operations, the basic premise being that fewer
employees indicate better efficiencies. This indicator is then plotted against the DAU for the following 14 carriers
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operating in the USA: American, Continental, Delta, Northwest , United, US Airways, America West, Southwest,
jetBlue, AirTran, Frontier, Virgin America, Alaska, Hawaiian, and Allegiant.
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Massachusetts Institute of Technology; Airline Data Project; http://web.mit.edu/airlinedata/www/default.html viewed on 22nd
September 2010
28
Northwest and Delta are considered as a combined fleet in 2009
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Although there does not appear to be a linear correlation between the two variables, it is interesting to note that
there appears to be an upper bound to the DAU for any given maintenance efficiency. As this efficiency decreases
(that is, increase in maintenance employees per aircraft) this upper bound decreases, suggesting the presence of a
Pareto optimal curve (indicated in red).
It is necessary to be cautious in assuming causality between such variables. Efficient maintenance operations do not
themselves “cause” high DAU’s. However, it is reasonable to assume that those airlines with efficient maintenance
operations would have the confidence to schedule higher DAU’s, and the suggested Pareto optimality provides some
basis of support to this assumption.
4.3 FINANCIAL PERFORMANCE
The above discussions on the operational performance and aircraft availability indicate the impact of maintenance
operations on the airline’s overall performance. An efficient maintenance operation assists airline profitability by
contributing to punctual departures and ensuring aircraft availability. In addition to these basic functions, the
maintenance operations themselves are a significant cost to the airline. In the 1960’s, maintenance amounted to 30%
of the operating cost and this has seen industry-wide reductions as a result of maintenance philosophies such as
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OCCM and MSG-driven maintenance programs . Today, maintenance costs are estimated to be in the region of 8%
31
to 15% of an airline’s overall operating cost profile.
5. CONCLUSION
th
Aviation has come a long way since the initial 37m flight of the Wright Flyer on 17 December, 1903. The modern day
commercial aircraft flies ever longer with more people on board, as evidenced by the Airbus A380, capable of carrying
850 passengers over a distance of 15,000km. With such radical advances in technology, simple hard-time maintenance
was found to be no longer satisfactory. Catalysed by the design and entry-into-service of the Boeing 747, the 1960’s saw
the emergence of OCCM maintenance and the establishment of the MSG. Together, these provided new maintenance
philosophies that reduced maintenance requirements by eliminating un-necessary and/or counter-productive hard-time
maintenance requirements and drove up reliability and availability by introducing a systemic, top-down, and task-
oriented approaches to establishing maintenance programs. These changes in maintenance philosophy have provided
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significant benefits to the industry, simultaneously improving maintenance efficiency and reducing maintenance costs
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from 30% to 16% of operating costs .
Whilst the impact of cost on financial performance is intuitive to understand, the impact of maintenance efficiency on
airline performance in general was then investigated. Performance was determined to mean operational performance
(punctuality) and aircraft availability, as well as financial performance. Empirical evidence (based on in-service data of the
Airbus A330 / A340 family) was provided to support the assumption that maintenance efficiency is the key driver of
technical dispatch reliability, with variations as much as 6% observed between operators.
Aircraft availability is measured in terms of DAU which is a direct product of the airline’s commercial schedule. However,
empirical evidence based on the operations of 14 carriers in the USA between 2005 and 2009 suggest that an efficient
maintenance operation is a (pre-) requisite for the commercial scheduling of high DAU’s.
The two discussions culminate in demonstrating that the evolution of maintenance philosophies has driven
improvements in maintenance cost and efficiency, which in turn have a beneficial impact on airline performance. Thus, it
is not merely the technological advances but the conceptual approach to maintenance that enables airlines to leverage
improved performance in today’s increasingly competitive environment.
** * ** END ** * **
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6. ABBREVIATIONS
747 Boeing 747
AD Accidental Damage
AFD Average Flight Duration
ASK Available Seat Kilometre
BH Block Hour
DAU Daily Average Utilisation
DI Detailed Inspection
DOT Department of Transport
ED Environmental Deterioration
FAA Federal Aviation Administration
FD Fatigue Damage
FEC Failure Effectivity Category
FH Flying Hour
GVI General Visual Inspection
MIT Massachusetts Institute of Technology
MSG Maintenance Steering Group
MSG-3 Maintenance Steering Group -3
MSI Maintenance Significant Item
NASM (Smithsonian) National Air and Space Museum
OCCM On-condition / Condition-based monitoring
OEM Original Equipment Manufacturer
SDI Special Detailed Inspection
SSI Structurally Significant Item
TDR Technical Dispatch Reliability
US United Sates (of America)

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7. REFERENCES
1. Niehues, Belin, Hansonn, Hauser, Mostajo, & Richter; Punctuality: How Airlines can Improve On-Time
Performance; 2001; Booz-Allen & Hamilton
2. Wikipedia; 2010; Wright Flyer; http://en.wikipedia.org/wiki/Wright_Flyer viewed 25th September 2010
3. NASM website; 2010; Milestones of Flight; http://www.nasm.si.edu/exhibitions/gal100/wright1903.html viewed

on 25th September 2010
4. Heracleous, Wirtz, and Pangarkar; 2006; Flying High in a Competitive Industry – Cost Effective Service Excellence
at Singapore Airlines; McGraw-Hill Education
5. International Air Transport Association; 2009; Annual Report
6. Transport Studies Group, University of Westminster, London; 2008; Dynamic Cost Indexing - Aircraft
Maintenance – Marginal Delay Cost; EUROCONTROL Programme CARE INO III
7. Gdalevitch; 2008; MSG-3, The Intelligent Maintenance; http://www.amtonline.com/online/printer.jsp?id=1039

rd
viewed 23 September 2010; Aircraft Maintenance Technology online
8. Robertson & Forsyth; 2010; Engineering and Maintenance Resources; AVIA5005 Course Notes; University of New
South Wales
9. Hocking; 1995; Condition Based Monitoring; Qantas
10. Aviation Glossary; Maintenance Steering Group; http://aviationglossary.com/airline-definition/maintenance-

rd
steering-group-3-msg-3/ viewed 23 September 2010
11. Airbus; March 2009; Maintenance Review Board Report – Airbus A318/A319/A320/A321; Revision 14
12. Massachusetts Institute of Technology; Airline Data Project; http://web.mit.edu/airlinedata/www/default.html

viewed on 22nd September 2010

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The University of New South Wales

Part B (Course Facilitator’s Use Only)

The Evolution of Aircraft Maintenance, and its Impact

PROGRAM: MSC TECH IN AVIATION INDUSTRY MANAGEMENT

COURSE : AVIA5005 – AIRLINE OPERATIONS MANAGEMENT

STUDENT NAME: INDUNIL M WEERASINGHE

3. THE EVOLUTION OF AIRCRAFT MAINTENANCE

3.1 HARD-TIME MAINTENANCE

In effect, this lack of increase in mortality with Age

3.2 ON-CONDITION / CONDITION-BASED MONITORING MAINTENANCE

Given the demonstrated success of OCCM, most

OCCM maintenance has been widely adopted by

However, it is important to realise that the

3.3 THE MAINTENANCE STEERING GROUP

The Evolutionary Development of MSG-3

FAA/Industry Steering Maintenance Steering Reliability Centred Maintenance Steering

3.4 THE MSG-3 BASED APPROACH TO MAINTENANCE

SSI’s are approached by the MSG-3 process in a similarly systemic and

3.5 THE EVOLUTION OF AIRCRAFT MAINTENANCE

4. IMPACT OF MAINTENANCE ON AIRLINE PERFORMANCE

4.1 OPERATIONAL PERFORMANCE

Notwithstanding the long-term performance, even an

It is not surprising therefore that a study commissioned

4.2 AIRCRAFT AVAILABILITY

The potential cost saving in this scenario is:

Monthly lease cost = 0.75% of price

4.3 FINANCIAL PERFORMANCE

AFD Average Flight Duration

ASK Available Seat Kilometre

DAU Daily Average Utilisation

DOT Department of Transport

FAA Federal Aviation Administration

FEC Failure Effectivity Category

GVI General Visual Inspection

MIT Massachusetts Institute of Technology

MSG Maintenance Steering Group

MSG-3 Maintenance Steering Group -3

MSI Maintenance Significant Item

NASM (Smithsonian) National Air and Space Museum

OCCM On-condition / Condition-based monitoring

OEM Original Equipment Manufacturer

SDI Special Detailed Inspection

SSI Structurally Significant Item

TDR Technical Dispatch Reliability

US United Sates (of America)

2. Wikipedia; 2010; Wright Flyer; http://en.wikipedia.org/wiki/Wright_Flyer viewed 25th September 2010

3. NASM website; 2010; Milestones of Flight; http://www.nasm.si.edu/exhibitions/gal100/wright1903.html viewed

5. International Air Transport Association; 2009; Annual Report

7. Gdalevitch; 2008; MSG-3, The Intelligent Maintenance; http://www.amtonline.com/online/printer.jsp?id=1039

9. Hocking; 1995; Condition Based Monitoring; Qantas

10. Aviation Glossary; Maintenance Steering Group; http://aviationglossary.com/airline-definition/maintenance-

12. Massachusetts Institute of Technology; Airline Data Project; http://web.mit.edu/airlinedata/www/default.html

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