by Heidi Riley
At this year’s PEI Sea to Sky Aerospace, Defence, and Marine conference, a panel of PEI industry leaders spoke about succeeding in the new business environment resulting from COVID-19.
Moderated by Carole Lee Reinhardt, President & CEO, Atlantic Canada Aerospace & Defence Association (ACADA), four PEI aerospace business owners spoke about how their companies were faring during this time of uncertainty.
Mark Coffin – CEO, Tronosjet Maintenance
Founded in 2001, Tronos is an aircraft leasing, major modification centre and aircraft maintenance services provider which services aircraft from all over the world. There are 32 staff members.
The company is an EASA and Transport Canada approved Aircraft Maintenance organization located at Slemon Park. The Tronos Manufacturing machine shop opened in 2016 in the Charlottetown Airport Business Park. They use CAD software to design and manufacture machined components.
“We are very fortunate that we generally deal with niche aircraft operators, which have not seen as big an impact as commercial air travel,” says Mark Coffin. “Most of our clients are stable.
“As we saw places in the world where COVID-19 was advancing, our workplace put plans in place in February, and got our staff cognizant of social distancing.
“In manufacturing, we looked at supply chain issues to see if we needed to order stock immediately, considering impending shortages and shipping difficulties. We implemented health and safety aspects as well.
“Overall, we learned how fragile everything is, and that these events have a broad reach in an industry so reliant on people movement.
“We looked at integrating advanced manufacturing. Some of our customers and end users had supply chain issues and shipping delays which prompted them to ask us to manufacture the components they could not access. What business we have lost in some areas we have been able to pick up in other areas.
“Being at home and not travelling as much has given me the chance to put into motion ideas that I didn’t have time to pursue before. That has been helpful.”
How will the workplace change going forward?
“I don’t think this is the end of the pandemic, and even if there are not more episodes like COVID-19 in the near future, anything even remotely like this will cause problems for all of us.”
Business recovery estimate
“We just moved a plane from here to Chile, and the process was very difficult because of the number of stops in different countries. Things are getting very complicated and will stay that way for a long time.
“We are optimistic about looking closer to home for work we can do. There is a tremendous number of bright minds around here, and we often go to the big city to find them. We don’t have to do that. There are things we can do collaboratively and we have education systems here that really are quite good.
“Some people say 40 percent of the market won’t bounce back until 2025. Airlines are reestablishing their schedules, but nobody gets paid for hauling air. Airlines are taking the chance that if they put airplanes back in the air, and make things look as normal as possible, people will return.
“I think we are into a long period of slowness. There are lots of wheels to fall off the wagon yet. Companies leasing aircraft are being given rent holidays, and there is a lot of government money flowing for wage subsidies and business grants. Those things will stop shortly, because they can’t continue to take the hit. Once the money stops flowing, you will see assets parked even faster. We think by the end of the year asset values will start to head for the floor. Once government programs dry up, we will start to see layoffs take effect.”
The Atlantic Canada advantage
“We all benefit by being in Atlantic Canada. Businesses are able to connect with policy and decision makers much faster than if we were in Ontario. We are able to develop relationships, trust, and confidence with decision makers. There are also advantages in staying smaller because it allows us to be more able to weather these types of things.”
Jobs in demand
“We do manufacture and design work, and we have been hiring even though this pandemic. We have been looking for skillsets around additive 3-D printing and design. We find that Technical Drafting CAD skillsets aren’t there. We are having to turn people into designers for new technologies.
“There is a concern on our part of what programs colleges continue to offer. The Aircraft Maintenance Engineer and the Aircraft Gas Turbine Engine Repair and Overhaul programs are being paused. It is very hard when you pause those programs to generate momentum back into them. The other danger for us is we had already had a shortage in the industry of people with the skillsets to work in aerospace. If programs are on pause, we will end up with a skills gap again.”
Future of Aerospace
“I encourage people to consider a career in Aerospace. The industry is not dead. If someone is interested in being a pilot or a maintenance technician, or any aspect of aerospace, those jobs will still be there.
“However, I do encourage anyone interested in the field to make sure they have a fall-back plan. If you get your pilot’s license, develop another skill or trade as well, so that when the down time comes, you have something else to go to.”
For more about Tronosjet, visit www.tronosjet.com/maintenance
Jason Aspin – CEO & CTO, Aspin Kemp & Associates (AKA)
AKA is a technology and systems integration company that works mostly in the offshore oil and gas, marine, and energy sectors. AKA is located in Montague, with a 100,000 square foot manufacturing facility, engineering center, and headquarters, with a team of about 100 people.
“As we started to see COVID-19 developing in Asia, we started to prepare for it here,” says Jason Aspin. “We geared up operations and separated the company into different divisions to mitigate risk if we did have a shutdown. We managed five or six active job sites around the world throughout the pandemic, and we are still active.
“COVID-19 has really impacted our client base and we saw things shut down a lot faster than we anticipated. Projects in development or in the sales cycle stopped. Our clients stopped spending money. We also had the double hit of the oil and gas sector shutting down. That was hard on the business because our projects have a long cycle life.
“We have jobs that we sold a year ago that we are still actively trying to finish. We did not get less busy, but the impact of revenue loss was pretty massive. The work we did do while managing in an international framework became much more difficult and expensive. Bringing people in and out of job sites to carry out projects and finish them off has been extremely difficult. We continue to try to sell to our client base, and we are trying to pivot into other areas in the energy sector.”
Lessons learned
“We learned there is a lot of great talent locally and with other business partners, and we have had lots of great discussions with businesses in our community. As an export company, we focus on where our clients are, and we forget about people who we can work with locally. The most important clients and partners may be right around us and not halfway around the world, so we need to engage people here.
“As a company that works in the marine oil and gas environment, we have also learned to constantly look at what we are doing in the field, mitigating risk, making sure all the people come home safely, and getting projects finished on time without cost overruns.
“We had to look at our own company with the same lens to try to reduce risk in our operations. We have gained insight and better understanding around the internal workings of our business, and hopefully we can get through this and end up with better, more efficient operations in the future.
“We learned that even if our most important client is located halfway around the world, we don’t necessarily have to jump on an airplane to see them in person. That new way of communicating will have a long-lasting impact, longer than the disease will last.
“From a business point of view, we won’t be travelling as much as we did in the past. However, our business revolves around going to places to get projects done, so that part will come back, and has already started to come back.”
Workplace changes
“Our workplace has changed a lot. We have engaged our IT capabilities a lot more. We were surprised to find that people are quite efficient working from home, and we will continue to have people work from home a bit as we go forward. It is more of a challenge for those on the shop floor. We will probably have more redundancy in our supply chain than before, which had caused problems in our manufacturing and execution projects.”
“Before the pandemic, I was the only one working from home. Once employees began to work remotely, productivity went up everywhere in the business, and sick days went down. As we realized the importance of what was happening, everyone pulled together. The question is will productivity remain high as working from home becomes more normal.”
Business recovery strategy
“For our business, we hope the recovery is as sharp as the downturn was. We took about a 90 percent hit on business, which is common for companies doing the type of work we do.
“Our niche is making systems more efficient and reliable and making operational costs lower, and I certainly think anyone who survives as a ship operator or in the oil and gas sector will be looking at optimization and how they will be able to continue to make a dollar in the new normal. Hopefully we will be ahead of that curve.
“I don’t see us getting back to 2019 revenues for at least two or three years. Most infrastructure projects will continue relatively unchanged. But the oil and gas sector has been dealt a fairly tough blow, and I don’t think it will ever come back to where it was before COVID-19.”
“Diversification of our product line and not having all our eggs in one basket is important. We hope our diversification efforts will achieve efficiencies where we can capture more market share.
“We would like to execute more projects locally or at least within Canada so that if one part of the globe gets shut down, we can focus on areas closer to home. We are very excited about the two solar PV microgrid projects, one in Summerside and one in Slemon park, the latter announced only in August 2020. This will be a great opportunity to show the world the technologicial knowledge available on the Island.”
The Atlantic Canada advantage
“There is an advantage to being in Atlantic Canada rather than being one of many companies in a larger area,” says Jason. “Companies here can influence policy and have direct discussions with people in government and with the industry. We can move and pivot quickly, whereas bigger companies take more time to do that. When we see conditions change like they have in the past months, we can respond and change our organization to achieve the best result.”
Working in Aerospace
“The day you start in a new sector, especially one that changes as rapidly as Aerospace, you have to be willing to work hard and learn.”
For more about Aspin Kemp & Associates, visit www.aka-group.com
Kerry Butler, VP Finance and Operations, MDS Coating Technologies
MDS Coating Technologies in Slemon Park manufactures erosion and corrosion resistant coatings for gas turbine engines for military and industrial applications.
“When COVID-19 hit, we were somewhat prepared, because our customers require us to do a lot to mitigate their risk, including having a pandemic plan and a disaster recovery plan in place. We realized our plan was not specifically designed to prevent the transmission of COVID-19, so adjustments had to be made.
“We do a lot of work for the military, which is great because revenue from that source spiked as commercial aviation disappeared to almost nothing. That spike meant that the pain of the revenue drop was not that bad.
“We looked at sourcing our supply chain. Fortunately, we carry a large amount of buffer stock and a lot of key components, which really helped us as well.”
Workplace changes
“We fine-tuned a lot of our IT processes to accommodate people working from home, and we improved things on the engineering and accounting side.
“It is difficult to break old habits and learn to operate with six feet of social distancing, wash hands regularly, and stay home from work when you have the sniffles. The important thing is to ensure if something does happen, we don’t jeopardize our whole staff. We need to keep them safe.
“Of those people working from home, 99.9 percent are more productive. That was an eye-opener for management. The younger workforce especially appreciates the flexibility of working from home.”
Business recovery strategy
“Travel will be limited going forward, and we have realized we don’t always have to travel to attend the usual board meetings. I do not see this pandemic going away soon, and I don’t see passenger air travel going up any time soon.
“We had diversified into commercial projects as well as military, but now we are back to one industry. Diversifying and using our knowledge and skills to become applicable to another industry is still important.
“Fortunately for us, our retraction was less dramatic than for most companies in the aerospace sector. Recovery for us looks more focused on the military side and we will have to wait out the commercial aviation side until it comes back, and we will be positioned well to take advantage when it does come back.
“The key for commercial aviation coming back is doing a lot of work on aircraft to make passengers feel a lot safer with respect to pandemics. That means a big overhaul, and to do it at a time when there are no sales is pretty difficult.”
The Atlantic Canada advantage
“The great advantage to being on PEI is that companies have access to decision makers and can avoid a lot of bureaucracy to get things accomplished. Many talented young people prefer to stay here, whereas in other regions they don’t. Also, in this pandemic, the PEI government was quick to react and do the right things.”
Keeping employees engaged
“It is important to continue to keep employees connected through online meetings. When we are separated as some work from home, it is easy to forget about how people are dealing with this pandemic. Here on PEI there is a shortage of help for people experiencing mental health difficulties. That needs to be addressed.”
Hiring strategy
“As an employer, when we assess new people coming in, we look beyond what is on their resume, and look at the character of the person, the work ethic, and how smart and quick they are in reacting and adapting to changing circumstances. That goes a long way towards being a successful hire.”
For more about MDS Coating Technologies, visit www.mdscoating.com
Dave Trainor, President, Action Aero
Action Aero in Charlottetown specializes in the overhaul and repair of fuel, oil, and air-related engine accessories.
“When COVID-19 hit, we continued to operate, but for six weeks we moved our staff to two shifts,” says Dave Trainor. “Half came in during the day, there was a half hour for cleaning and sanitizing, and then the evening shift came in.
“That gave us time to put in place more stringent measures. We rearranged the shop floor to allow for social distancing and sanitizing and then moved back to working the same shift. The biggest adjustment was working around schedules and trying to keep everyone safe.
“Trying to get PPE (Personal Protective Equipment) is a challenge. We have been told we can’t get extra large gloves, because there is a shortage. We can’t expect any until next year! How do you plan for that? Even though we are used to the new normal, there are still challenges every week.”
Workplace changes
“Prior to COVID-19, we had zero capability to work remotely. We had to amend some things very quickly. The shop floor technicians are normally in the shop taking stuff apart. The work dropped off significantly and very quickly, so how do you keep all these people busy? We were able to adapt some training programs and put them online. To assist with social distancing, some people worked from home certain days of the week, doing development and training online. Going forward, we will continue to do that.
“Before COVID-19 hit we had done some six-sigma training. With the work volume being down significantly, it gave us time to take what we learned and implement some projects very quickly. With these new processes and improvements in place, we will be much better positioned whenever clients come back. We will be able to handle things much more efficiently and handle much more volume with the same number of people.
“The biggest thing that has changed in our workplace is the health and safety practices we have put into place. Sanitizing is happening regularly and frequently, and I think that will continue for a long time.”
Looking into the future
“Hopefully the general public’s fears will subside, and more people will start to travel again. Planes have to fly in order for things to turn positive for us.”
Dave believes the aviation industry in general will probably take three to five years to recover. “It will take time for consumer confidence to come back and for people to fly as much as they did before. Action Aero is not in the commercial airline business but deals more with regional turboprop customers, and we are very diversified. We have customers in agriculture and firefighting as well.
“Since COVID-19 started, we have been looking at a few new product lines to try to diversify more. As we get those capabilities up and running and generate some revenue, we know it might take two to three years to get back to where we were in 2019.
“We need to get everybody motivated and starting on new product lines and focused on customers. Our competition is trying to take our customers. By focusing on what customers want, price, and product delivery and quality, we can be the best in the world, and our recovery should be shorter than our competitors.”
The Atlantic Canada advantage
“The province of PEI has done a great job of getting things under control very quickly. One of the advantages to being located in eastern Canada is the flexibility of the workforce. Overnight, things had to change quickly, and there was no pushback. They wanted to know what they could do to adapt and change.
“I talk to people all over the world, and I don’t think other companies would be able to convince their workforce to come onside that quickly to make sure everyone survives. It goes back to the people and their work ethic and flexibility.”
Education and training needed
“In general, as companies come up against skill set gaps of their employees, we have found it difficult to get education institutions to develop training for our needs. They are businesses as well, and to develop a one-off course can be cost prohibitive.
“We would love to have a local or regional place for specific training. If we could get together as a region, identify a skill gap, and then partner with education institutions in the region to send more people, it may make more sense to offer that course.”
Engaging the workforce
“Communication is key to keep employees engaged. We need to keep our employees focused on customer expectations. Now that we are not as busy, it is time to focus on process improvements. That will keep the workforce engaged so that we can be the best we can be. There is no easy solution.”
Advice about considering a career in Aerospace
“As you enter the workforce, you need to be adaptive,” says Dave. “If you usually sit at a computer, you need to be willing to roll up your sleeves and get your hands dirty.
“Don’t think you are hired to do just one job. You need to be very flexible and willing to do tasks you don’t have any experience with and put all your brain power and effort into it.
“We succeed as a team, and when you collaborate with people of different backgrounds, you can come up with a solution.”
For more about Action Aero, visit www.actionaero.com