Seattle’s Aviation Partners and iJet Technologies have joined forces in a software-as-a-service venture called APiJET, which is aimed at making airplanes smarter — and producing significant savings for airlines in the process.
How significant? Joe Clark, founder and CEO of Aviation Partners Inc., said the Smart Aircraft system could cut the cost of operating an airplane by 10 percent or more.
“The airlines know that we don’t get involved in something unless we think it’s really good. … I see the traction happening very quickly,” he told reporters at Aviation Partners’ Boeing Field headquarters.
The first customer is low-cost carrier Icelandair, which has been been using APiJET’s data service since the end of 2017. It’s installed on all of the airline’s 757s and 767s.
“The APiJET solution has delivered value for Icelandair from the first installation,” Icelandair program director Gretar Mar Odinsson said Monday in a news release. “The ability to deliver value across the entire airline is unlike anything in the market today. We’re so happy with the product and team that we’re also installing it oun our new 737 MAX.”
The service could pick up two or three more fleet customers by the end of this year, said Tom Gibbons, who’s president of Aviation Partners 2 as well as chief commercial officer for the APiJET venture.
The data-focused venture is opening a new frontier for Aviation Partners, which is best-known for providing aftermarket winglets for planes ranging from Gulfstream business jets to Boeing airliners.
Clark explained that the company’s first foray into big data is in line with its mission to increase efficiency and reduce costs for airlines. “We’re trying to look at it through the airlines’ eyes,” he said.
APiJET takes advantage of Aviation Partners’ long-running relationship with airlines as well as technology that iJet has developed over the course of seven years.
The Smart Aircraft service taps into the megabytes of data that are generated by an airplane’s onboard network system. The software resides on an onboard computer server — perhaps even a server that’s being used for other purposes — and processes readings that reflect more than 1,500 parameters.
Some of those parameters are pretty simple: Is a particular door on the airplane open or closed? Is the plane’s auxiliary power unit on or off? But the state of those parameters can determine whether dollars are being wasted.
For example, if the auxiliary power unit is left on overnight, that uses up jet fuel unnecessarily — and could delay the plane’s morning departure due to the need for refueling.
“You leave the APU on all night in Bogota, Colombia, you don’t want to know about it in eight weeks, you want to know about it in eight minutes,” Clark said.
Smart Airliner digests all of an airplane’s readings and uses a set of apps called “Actors” to sift out the significant bits of information. That information can be fed into other onboard software, such as the Pacelab Flight Profile Optimizer, or transmitted to an airline operations center via the plane’s in-flight data connections.
After the flight, the full set of airplane data can be retrieved for further analysis.
Icelandair uses the system with Pacelab to optimize fuel efficiency in response to real-time weather data, Gibbons said. In-flight course adjustments produce incremental fuel savings that add up.
John Schramm, who’s the CEO at APiJET as well as iJET Technologies, compared APiJET’s business model to the statistics-based, sabermetric approach to baseball that Billy Beane used when he managed the Oakland Athletics. Beane’s method was documented in “Moneyball,” a book by Michael Lewis that was turned into a movie starring Brad Pitt.
“Our whole value proposition is about stacking up marginal improvements on a continuous basis,” Schramm said. “That’s your killer app: the aggregation of marginal improvements across the company.”
APiJET sells the service for a per-plane, per-month fee. Because the system relies on software rather than specialized hardware, there’s generally no added capital expenditure for the customer. “If it’s configured properly and deployed properly, you make money your first month,” Schramm said.
Under its joint venture arrangement with Aviation Partners, iJet Technologies has a minority stake in APiJET and will receive a portion of the revenue for the use of its data processing technology. Gibbons and Schramm declined to go into the details of the arrangement, but for what it’s worth, iJet reported a $24.7 million investment transaction in 2016.
The service market is turning into a hot sector for the aviation industry: The Boeing Co. estimates that aviation services will account for $8.5 trillion in sales worldwide over the next 20 years, and in 2016 the aerospace giant created a global services unit to go after a bigger share of that market.
Clark, who co-founded Aviation Partners more than a quarter-century ago, acknowledged that Boeing will eventually “play a huge role” in aviation services. But he said APiJET will be particularly well-suited for its new market.
“No. 1, we know the customer base well. No. 2, we’re small and lean and mean, so we can move quickly,” Clark explained. “The big boys … they tend to move verrrry slowly.”