At Robinson Helicopter Company in Torrance, supply chain issues began to crop up about a year ago.
Curt Robinson, chief executive officer of the Torrance aircraft manufacturer, said the first year of the outbreak saw the company carry large inventories of everything, so supply chain problems did not affect the company early on.
“It’s definitely impacted us a little bit over the last year or so,” Robinson said. “We’ve seen many suppliers miss delivery dates by wide margins.”
Playing into that is the high rejection rate of classes.
Robinson said that when he talked to suppliers about this, he was told that it was a high turnover of workers or a change in the type of material used to make the parts.
“We have to maintain a high level of quality, and so in the last six to nine months we’ve had very high rejection rates,” Robinson added. “That’s really our biggest concern as we go forward, not just that they give us the 100 units that they should, but that all 100 units are at the quality that they want.”
Robinson Helicopters is not alone in facing global supply chain disruptions due to the Covid-19 pandemic, which has begun to shut down in areas with high production volumes, particularly in China. Increased consumer demand; And backups at ports, especially in Southern California, home to two of the busiest ports in the world.
In addition, there was a shortage of labor in key functions to keep the supply chain running smoothly.
Like Robinson Helicopter Company, Lee Enterprises is also facing supply chain issues. The Chatsworth-based manufacturer, founded in 1974, operates exclusively in aerospace. 75% is for military customers and 25% is for commercial aviation. It manufactures parts and assemblies for a variety of aircraft, machining parts from carbon steel, stainless steel, aluminum and other standard aircraft metals.
“We make parts that are special gears that go into electromechanical actuators,” says President Tom Molnar. “So a lot of our stuff is outsourced.”
After machining at the Lee facility, those parts are sent for heat treatment and plating. But the company’s lead times in heat-treaters and plasters are taking longer and longer because they’re short-staffed and experiencing a surge in workload, Molnar said.
Burbank aircraft parts manufacturer David Fisher, who owns S&H Machine, also sends parts to be heat treated and coated for commercial aircraft. He said that there are hundreds of suppliers working in the company, and the cost of doing business has increased, so they have increased their prices.
“This is putting a lot of financial pressure on shops like mine because we are locked into contracts and fixed prices for many years. It makes it challenging for companies like us,” he said.
Due to supply chain and labor shortages, S&H is not taking on new work. Instead, he always focuses on the legacy of his work, Fisher said.
He added: “I’m going back because I can’t afford to do a business that I haven’t seen before.”
A certain amount
David Goodrew, president of the Small Business Aerospace Industry Coalition, a Glendale-based national nonprofit network of independent small businesses that manufacture and supply military aerospace parts, components and assemblies, said the coalition will sell some manufacturing equipment, including some simulators for CNC. (Computer number control) machines.
Another company bought the three simulators for two thousand dollars and did something interesting.
Because computer chips are limited in size due to supply chain issues, the company has moved them out of simulators and into other devices, Goodreau said.
“You have cases like this where people make lemonade out of lemons,” he added.
For Molnar, Lee’s enterprise, the opposite is true, because everything is taking a long time to do.
Customers are pre-ordering more parts as it takes a long time to process the parts, he said.
So in addition to ordering more parts to keep prices down, Molnar added, they are ordering parts sooner.
“I feel it is creating an artificial backdrop that increases demand when there is not enough supply,” he said.
For Robinson, it’s a very simple equation: “If you don’t have parts, you can’t build helicopters.”
Low optimism
Sikich, a Naperville, Illinois-based consulting and technology company, last week released its latest Sikich Industry Pulse, a report on the manufacturing and distribution industry. The survey results were gathered from the responses of 100 manufacturing and distribution executives who were asked in June.
The survey found that only 58% of manufacturing and distribution executives rated their prospects at seven or higher on a scale of one to 10.
Supply chain and labor shortage issues played a role in how manufacturers fell behind in meeting their customers’ needs.
Forty-three percent of executives surveyed said supply chain bottlenecks leading to material shortages were the number one reason their companies were unable to meet demand. 39 percent cited labor shortages as a factor in not meeting customer needs.
But Fisher, an S&H machinist, is not pessimistic about the future of the business.
“I have to find people and I have to find automated routes,” Fisher said. “The fact that I have a job is a good thing. Yes, shortage of raw materials is a problem, and shortage of people is a problem. But if you have a job, you have hope.
Fisher said he feels good about the future and is confident he will get through this difficult time.
“I have less competition than I’ve had before, so that’s a good thing,” he added. “There’s some good stuff out there.”
