The post-war years brought an eager young player into the business – the builder of PMA parts. Predictably, unpleasantries were exchanged with the big OEMs. But the rulings of acceptance by regulatory bodies have been game-changers for the PMA industry. And now, even its most vocal opponents are climbing aboard.
Welcome to 2014, and welcome back to our bi-monthly discussions on all things aviation. Hope you had a pleasant holiday and are ready to begin what promises to be an exciting and productive new year. So let’s open the New Year with a lively discussion about Non-Type Certificated (NTC) aviation parts whose production and distribution is approved by the Federal Aviation Administration (FAA). And your first question is: if these parts are not TC’d then they must be “bogus” right? Wrong! These parts are manufactured as alternatives to the original part produced by the Original Equipment Manufacturer (OEM) and are approved as an alternative by the FAA. Thus, this alternative part is identified as a Parts Manufacturing Approval (PMA) part.
Now, for you long-time students, I know you are wondering if I am having a “senior moment”. And the answer is no, but as sharp as you are, I know you all remember a conversation we had about two years ago on this very subject. And you are right! We did go into great depth about PMA and all the regulations involved two years ago this month as a matter of fact. “To PMA or not to PMA” was the question and the name of the article. But like many subjects that are worth discussing again, PMA is certainly worth our attention once again because there continues to be a relentless undercurrent of misinformation about PMA.
Since I am the author of that article and it is chock full of good information, I am going to use it as reference for today’s discussion, not as a regurgitation of the original but rather as a sequel that encapsulates the important parts of this controversial subject. Also for today’s session, I have used sections from the following FAA approved documents for reference: FAA Order 8110.42c and FAA Special Airworthiness Information Bulletin (SAIB) NE-08-40 and Federal Aviation Regulation (FAR) 21.137.
Let’s begin with a little history. The idea of PMA came to fruition in July 1955 when the FAA – in an attempt to keep the flying public safe, and at the behest of the civilian owners of out-of-production surplus military aircraft who were having a difficult time obtaining acceptable OEM parts – considered it acceptable for companies other than the OEM to design and make spare aircraft parts. The rule of the day was “equal to or better than.” This created the PMA industry and produced two types of PMA suppliers: Licensed Suppliers and Competitive Suppliers.
1. Licensed Suppliers paid licensing agreements with the OEMs and produced these parts. This removed the burden of providing support for the out-of-production aircraft and allowed the OEMs to place their money into developing new products. Everybody was happy with this arrangement.
2. Competitive Suppliers came about when the entrepreneurial spirit grabbed a few of the Licensed Suppliers as well as attracting other manufacturers to this innovative process for supplying aviation parts. They recognized a financial opportunity and began to challenge the OEM for market share on current production aircraft parts. Thus, the Competitive Supplier who, while providing acceptable, economically attractive alternative parts to the operator, provided financial grief to the OEM. Thus, there is this competition for market share that has strained the relationship between OEMs and PMA manufacturers. So what are PMA parts?
PMA is a combined design and production approval for the replacement parts for installation on or into a type-certificated product. A PMA may also be used for the production of modification parts from a Supplemental Type Certificate (STC). The STC approves the design and installation of these modification parts in products. However if any replacement part alters a product by introducing a major change, the 14CFR 21.113 requires an STC for approval of these parts. And as an added bonus, the definition of an STC is a TC issued as a supplement when an applicant has received FAA approval to modify an aircraft from its original design. The STC incorporates, by reference, the related TC, and approves not only the modification but also how that modification affects the original design.
1. A PMA part is not a “bogus part.” Ref. FAA SAIB NE-08-40: “…PMA and STC parts are thoroughly evaluated for compliance with respect to any changes they introduce and their effect on the original type design. The need for supplemental instructions for Continued Airworthiness (ICA), new airworthiness limitations, and other conditions is established by the FAA to ensure the safe integration of the PMA and STC parts into the product…”
2. Installation of PMA parts does not change the life limits or the OEM warranty of the other parts within the assembly.
3. PMA is not for the approval of inspection procedures, materials or processes. Any specific inspection procedures, material or processes (such as hardening, plating, or shot-peening) approved as part of a PMA are valid only for that particular part.
4. Parts produced under a “one-time only” STC or field approval are ineligible for PMA.
Why PMA over OEM?
PMA parts have become a popular alternative because, as a general rule, they are less expensive than the OEM original parts, and in a lot of cases, more readily available. Hmm. Less expensive and readily available? OK, how do they do it? To begin with, the PMA manufacturer only has to invest in the engineering and manufacturing costs to produce their PMA part. The PMA manufacturer also can cherry pick the parts they wish to produce. By that I mean they choose those parts with the most replacement activity and/or those parts with an apparent inflated OEM price.
The OEM on the other hand has to fund the support of their entire product line, including engineering research for product improvements, as well as an inventory of spare parts for the aftermarket support of their product.
Let’s look at an engine manufacturer for example. They have to pay for the development of the engine, certification costs of the engine, production of the engine, spare parts, and finally, a network to distribute the parts and support the product in the field. Put all these costs together — then add the financial obligation of continuing airworthiness documents (overhaul, parts, and field maintenance manuals), inventory costs, personnel to manage all of this — and you can possibly understand the acrimonious feelings of the OEM toward the PMA manufacturer.
Now, one thing I want you to notice in my last paragraph. I have not used the word “cheaper” when comparing the cost of the OEM and the PMA part. I don’t want any misconceptions about the quality of the PMA part. The PMA part may be less expensive to purchase, but it for sure cannot be categorized as “cheaper.” The PMA part is at minimum the same quality as the OEM part. Often, the PMA is of a higher quality than the OEM part it replaces. Better you ask? How can that be?
Well, the PMA provider has the advantage of evaluating the OEM part, discovering and improving upon any weakness exposed during the evaluation process. Also, the PMA manufacturer needs to address any product difficulties the OEM might have experienced and demonstrate how they will not be duplicated in the PMA part.
Until recently, the OEMs were on a campaign to discredit PMA installed parts with statements of warranty violations and safety concerns. In 2008, after an extensive investigation by the FAA, Transport Canada, and the European Aviation Safety Agency (EASA) which was requested by the OEMs, these regulatory agencies could find no statistical evidence that PMA parts are a safety concern. Nor could these regulatory agencies find any fault with their approval processes of PMA parts. The FAA issued SAIB #NE-08-40, publishing these facts and extolling the quality of the PMA parts, thereby validating that the real reason for the OEM objections is based upon economics, not safety. The regulatory agencies also denounced the use of “anti-PMA” language in their maintenance instructions.
This language put the installing technician between a rock and a hard place because, per Advisory Circular (AC) 43-13-1A, as the maintainer, you are to follow the OEM’s instructions. However, as most technicians discovered, AC43-13-1B states that, as a maintainer, you can use a part or practice that will safely return the aircraft or appliance to its original condition. So, until all the OEM “anti-PMA” language is removed from their documents, technicians can install a PMA part knowing they covered the precepts of AC43-13-1B.
During the last 12 years, requests for PMA approvals to the FAA have soared. While the ramp-up for new aircraft production has increased lead times on OEM spare parts, an estimated 550,000 PMA parts have been brought to the marketplace. There are industry estimates that the FAA is approving about 1,500 applications a month from over 2,600 companies. OEM apathy to the operators’ complaints about increasing prices — coupled with poor parts support and topped off with the support of the FAA — has fueled this increase in PMA parts usage. PMA has enjoyed such growth that one of the biggest opponents to the PMA, Pratt & Whitney Engine Company, has decided “If you can’t beat ‘em,
P&W has placed one manufacturing foot square into the PMA bucket via an ongoing program to produce and market PMA parts for the General Electric CFM 56-3 engine. And with over 12,000 CFM 56 variants in service, this is a heck of a good market in which to jump. P&W made the decision not to develop an engine in competition to the CFM 56 series, but rather redirected their resources from developing a competitive engine to developing PMA parts for the competitor’s engine. P&W has targeted the parts most often replaced during maintenance and overhaul, studying the reasons for the parts replacement as well as the rate at which they are replaced. Armed with these statistics, they can devise structural improvements for the parts they are manufacturing under PMA. This research is also used to improve their own parts, which helps defend against a PMA assault on their product. A great use of capital and manpower I would say.
The fact is that PMA has become a globally accepted alternative. As competition heats up for the operator, the distance between their cost of doing business and the profit from that business is shrinking. And one of the costs that owners/operators have found they can control, somewhat anyway, is the cost of the parts for maintenance through the use of PMA. The stigma of PMA = UNSAFE has been challenged and refuted, much to the annoyance of the OEM. And this has happened not by anecdotal journalism but through hours and hours of safe operation, as well as the regulatory agencies’ endorsement.
The OEM is in a tough economic situation. Competition between OEMs for market share is intensifying, and they too are watching the erosion of their profits. They need the revenue of aftermarket parts sales to help support research and development as well as the cost of producing and bringing to the marketplace a new type certificated component. And the winner for sure in this PMA vs. OEM is the operator. PMA has caused the OEM to take a second look at its parts and production costs and improve where they can. Also, as we have just seen, one manufacturer has become creative and has taken a second look at the PMA product, and is using it as a unique opportunity to remain profitable.
PMA vs. OEM: time will tell how this will all sort out, but one thing is certain: the marketplace will continue to keep both sides on their economic toes.
Well, we have reached the end of our review of PMA. And as always, I appreciate your attention and feedback. Let me know your thoughts on this. Now, as a famous orator once said about a presentation, “I hope today’s discussion has fit the definition of a woman’s skirt: long enough to cover the subject and short enough to be interesting.”
Take care, my faithful students; and let’s hope that 2014 is the best year ever for us all.
About The Author
Mike Broderick is V.P. of Business Development at Helicopter Engine Repair Overhaul Services (HEROS). Over the past 35 years, he has served as a shop technician, engine shop supervisor, Engine Program Director, Director of Maintenance, Director of Operations, and owner of a Rolls-Royce engine overhaul and MD Helicopter component overhaul shop. He is a certified A&P, and holds a Bachelor of Science degree in Aviation Administration. As well, Mike has been appointed as an FAA representative for the FAA Safety Team (FAAST) and is a member of the HAI Tech Committee. Mike is a regular contributor to Air Maintenance Update.View all articles by Mike Broderick.