The aerospace industry in recent times has faced tough market conditions and tremendous cost pressures. With the advent of the Covid-19 pandemic, the problems have exacerbated in the form of cash flow & liquidity challenges, reduced demand for materials and critical need for fuel efficiency. In this scenario, what is called for is a comprehensive approach to product cost management, involving methods of lowering operating & maintenance costs, adopting aircraft weight optimizations, better integrated supply chains, product localization strategies and lower cost region manufacturing & sourcing.
Under these broad approaches, the authors have attempted to focus and highlight on primarily three areas to address namely Supply Chain Risk, Supplier Base & Cost Inversion and Engineering Cost. Based on their analysis and experience in the related fields, they have put forward simple recommendations in the realm of alternate sourcing, strategic sourcing, risk analysis, negotiation strategies, digitization measures, Value Engineering and Design to Cost initiatives.