Air Taxi Industry Updates: DOT IG

I spent a large part of last week at the NBAA Maintenance Management Conference in Florida where I had the honor of appearing on the agenda to speak on maintenance risk and legal issues both from the litigation and regulatory perspective. As always, NBAA put on a great conference. In preparing for my comments, there was needless to say a wealth of relevant news and information on maintenance issues involving Part 121 air carriers. I also was aware of the testimony of Department of Transportation Inspector General Calvin Scovel (29 year Marine Corps veteran) as he had several opportunities to appear before congressional committees in the last few weeks.

On April 10, he spoke before the Senate Committee on Commerce, Science and Transportation, Subcommittee on Aviation Operations, Safety and Security. His comments were entitled "Key Safety Challenges Facing the Federal Aviation Administration." The April 10th testimony focused on "the key actions that FAA and its stake holders will need to address over the next several years. These included (1 ) strengthening FAA’s oversight of the aviation industry, (2) improving runway safety, and (3) addressing attrition in two of FAA’s critical workforces–air traffic controllers and aviation safety inspectors."

One week later, on April 17, 2008, the Inspector General testified before the Senate Committee on Appropriations, Subcommittee on Transportation, Housing and Urban Development, and Related Agencies. His comments, many of which were repetitive, were entitled "Key Safety and Modernization Challenges Facing the FAA." They focused on "(1) strengthening FAA’s oversight of the aviation industry, including its systems for monitoring air carriers’ use of outsourced maintenance and aircraft manufacturers’ suppliers; (2) keeping existing modernization programs on track, reducing risk with NextGen, and setting realistic expectations; and (3) addressing attrition within FAA’s air traffic controller and inspector workforces."

The IG's discussions in the April 17 testimony with respect to the importance of NextGen including ADS-B implementation ("a new satellite based surveillance system that has the potential to enhance safety and capacity") are very relevant to the air taxi industry. I have previously discussed the importance of NextGen.

However, with maintenance compliance in the news and the reliability of aircraft components always an issue, I wanted to highlight the IG's discussion on the FAA's oversight - or lack thereof - of the suppliers to aircraft manufacturers. Earlier this year in February, the DOT IG issued a report entitled "Assessment of FAA's Risk-Based System for Overseeing Aircraft Manufacturers' Suppliers." Many of the comments about suppliers in this month's testimony were based on the findings of this earlier audit report. Here are some insights as to current matters related to aircraft component suppliers that I thought were relevant to Part 135 and 91 operators, many of whom are utilizing new aircraft:

FAA's current oversight of aviation manufacturers is based on a system that assumes the manufacturer has primary control over the production of their aircraft rather than trusting suppliers to design and manufacture a large portion of the aircraft.
"FAA has not ensured that manufacturers are providing oversight of their suppliers. Manufacturers are the first line of defense in ensuring the products used on their aircraft meet FAA and manufacturers' standards."
"FAA does not require inspectors to perform audits of suppliers to determine how well manufacturer's quality assurance programs are working."
In the last four years, FAA "has inspected an average of 1 percent of the total suppliers used by the five major manufacturers [DOT] reviewed."
At FAA's current surveillance rate, "it would take the inspectors 98 years to audit every supplier once."
The DOT observed "systemic deficiencies" at the 21 suppliers it visited. "For example, nearly half (43 percent) of the suppliers had deficiencies in their tool calibration and employee training programs. Deficiencies in these areas could impact the quality of the parts of these suppliers."

One of my presentation "take-aways" was the importance of due diligence in outsourced maintenance in that although you can outsource the work, you cannot outsource the liability and ultimate responsibility for FAA compliance. That remains with the certificate holder and aircraft operator. With respect to component manufacturers and suppliers, I thought these comments on supplier oversight were somewhat noteworthy and relevant to Part 135 operators -- most of whom's business plans include new aircraft with a large number of components provided by outside suppliers.