Stalled, But Not Stopped

Flights grounded, training centres locked down, simulator deliveries hampered. Yet the training device industry has proven remarkably resilient. CAT Editor Rick Adams, FRAeS, spoke with several company leaders about how the market is changing.

This is an industry that’s bounced back from terrorist attacks, volcano ash, and previous economic crises. Did anyone think a microscopic virus would dampen the make-it-happen spirit of people whose daily mission is to defy gravity?

The initial assumption was no flights, no pilots necessary. No training, no schools, no simulators. Possibly for a very long time.

But that’s not necessarily the case. As airlines restart operations, pilots need to be current, which may require more than the usual training if they’ve been idled for awhile. Revamped fleets, particularly widebodies destined for the boneyard, will lead to downshifting of crews to other aircraft types and a ripple of re-training through the ranks. Lucrative offers will lure thousands of veterans into early retirement, shortening the time when a new generation of pilots will again be needed.

Time for Visions

As I spoke with several simulation and training leaders recently, one theme kept emerging in the conversations. Call it innovation, resiliency, adaptability. Yes, these are unusual times. Yes, some companies won’t survive, especially if the recovery is prolonged. But those who do are not content to just hang on; they are determined to use the slowdown to create new products and procedures that could alter the market post-Covid.

“If we have engineering resources available, we’re asking, ‘Is there a new platform? Is there a new data package we can flight test?,’” said John Frasca, President and CEO of Frasca International (www.frasca.com). “We’re an engineering house, and sometimes it’s hard to turn off the engineers.”

Since the pandemic began, Frasca’s eager engineers have created two new products which could have significant impact on training. One is a service which remotely connects instructors to a simulator via the Cloud, currently in beta test with a customer. “A simulator doesn’t exist in isolation,” Frasca explained. “It has to fit into a curriculum and use other resources. And all of this has been done manually and very much tied to an organization’s adeptness at integration.” The Frasca connected Cloud will record all flights and tie them to a student. “We have data and we have results; and the next step is to start thinking about machine learning.” The service will also feature an open environment, enabling use of third-party debriefing tools.

The second breakthrough is what I’m inclined to call “Level D Lite” – a high-fidelity AATD on a short-stroke, six-axis motion system and with a wraparound, three-channel visual system. The launch customer, this fall, will be Epic Flight Academy, New Smyrna Beach, Florida, with a device replicating a Cessna 172.

Frasca told CAT, “The feedback we’re getting from customers is they can’t use simulators more because the students aren’t getting the physical feel of the aircraft, and they’re overwhelmed when they go to the airplane. By putting on a small, high-quality motion system, they’re no longer overwhelmed.” The motion system was adapted from Frasca’s high-end projects on military helicopter simulators.

The project started pre-Covid “when demand was so high instructors weren’t available, aircraft weren’t available, and airspace wasn’t available. The goal was to expand simulator usage as far as possible; this simulator was the perfect answer for it.”

Frasca said, “I don’t think, incrementally, how can we get 10 percent more from the simulator? I’m thinking, how do we change the paradigm completely? My vision is, let’s do a private pilot license 100 percent in the simulator and then go to the aircraft for initial operating experience, like the airlines do.”

Accelerating Digital

CAE has garnered considerable publicity, especially in its Canadian homebase, for its rapid prototyping of the Air1 ventilator by its healthcare division, resulting in a government contract for 10,000 lifesaving machines.

The civil side of the Montréal mainstay meantime launched a career resources service for pilots, branded Airside. “We wanted to see if there was a way we could act as an intermediary, to build some community links with all the pilots – employed, unemployed, customers, not customers – focused on helping pilots find new jobs, career advice, those kinds of things,” said Nick Leontidis, CAE Group President, Civil Aviation Training Solutions. “We act as kind of an aggregator of jobs. Now, of course, there’s not a plethora of jobs available. The whole point is to facilitate this.”

CAE’s comprehensive digital strategy was devised a couple of years ago. “The first step was what we call digitizing the enterprise,” described Leontidis. “We want every step of the training process to be digital. The way the customers check in, the way instructors train, course material, tools they use, how they build lesson plans, the way they grade records.”

“We went from a very paper-intensive process,” he explained. “You have to call somebody to book a training event. You have to send in your paperwork to be able to qualify. Instructors are filling out all kinds of forms.”

In Montréal, a “digital accelerator” team is digitizing what the company calls “customer journeys.” Leontidis said, “That provides us with a wealth of data. And that data becomes the vehicle for us to be able to provide insights to customers.”

“Data analytics is something we think is valuable. The airlines have to manage training data. They have to manage flight data. They have to develop insights,” the former software engineer explained. “We have some encouragement that the data we’re collecting, intermixed with the data they’re collecting, could provide some interesting insights to them from a safety perspective, to improve their operation.”

“It’s a work in progress, he added. “We live in a regulated environment. So we don’t just roll things out whenever we want to. We have to do it in a controlled manner with the blessing of everyone.”

CAE also continues to evolve its Rise data analysis product (Robert W. Moorman has more on Rise in “ Tools of the Trade”)

FlightSafety International has had a “very, very favorable reaction” to their new FlightSmart product, said Scott Goodwin, Vice President Simulation. Developed with data processing giant IBM, FlightSmart will collect and analyze pilot performance data to facilitate “a departure from qualitative-based instruction toward evidence- and competency-based training … as opposed to repetitive actions rooted in a fixed syllabus.”

“You’re pulling all the data that’s available off a simulator, megabytes and gigabytes of data, and you run it through artificial intelligence. You teach it a few algorithms and it can be very good at spotting trends in real-time that an instructor may not be picking up that the student is doing. They can even get predictive,” Goodwin said.

By assessing a student’s performance, “you can find out what the remainder of the training profile should look like. Spend less time on areas which are strong, more time on areas they need work on. It sets you up for adaptive learning.”

“Once you’ve got this data, you are only limited by your imagination, what you can do in terms of improving pilot performance, tailor courses, reduce instructor workload. It opens up the potential for automated grading,” Goodwin noted.

He said FlightSafety has begun using FlightSmart in its own training centres, including for commercial customers. (Robert W. Moorman has more on FlightSmart in “ Tools of the Trade” )

L3Harris Commercial Aviation is also touting its data analytics capabilities. Peter Hogston, Head of Training, told CAT: “Cost effectiveness of training is also now invariably critically important for airlines. We are able to use our data analytics to increase training effectiveness and efficiencies. Aligned with this is flight data monitoring, which airlines currently have to use expensive resources to carry out, usually line pilots, and ensure safety compliance. The effect of Covid will be to accelerate this shift further.”

Delayed Deliveries

The ever-changing national quarantine rules have complicated deliveries of new training devices pretty much worldwide. “For all the madness, because we are doing service installation, we really have to adapt,” said Audrey Jeffroy, Sales Director, Alsim Flight Training Solutions. One solution was for Alsim engineers to produce videos, which guided customers and in-country subcontractors through the process.

When Covid restrictions precluded Alsim engineers from travelling to certain countries, they produced videos to help guide customers through the installation process. Image credit: Alsim.

“We have worked with the airlines to continue installs as local regulations allow,” L3Harris’ Hogston noted. “Since April, we have completed two certifications of new devices, while we have another five projects with people currently at sites undertaking installs.”

“Deliveries have been delayed because it’s harder when you just can’t get into a country,” said John Frasca. “We had a team in Canada and had to bring them back halfway through because Canada shut off business travellers.” That project has been completed, and there’s an installation in process in Germany. “We’ve sorted through all the travel restrictions.”

FlightSafety’s Goodwin told us, “A number of deliveries had to be put on pause. Each situation was different, but we have found ways through – doing remote work, hiring people in country. I won’t say at the pace we’d like, but at least moving again.”

CAE may face similar quarantine challenges in trying to execute the “footprint rationalisation” of a recently announced restructuring plan. They plan to relocate about 20 of the 268 full-flight simulators in their global network and “sideline” additional FFSs based on changing airline fleets. Leontidis told CAT that cities with two training facilities, such as Bogota, Colombia, will consolidate into one. “We have the big centre, the new facility, and then two simulators in the small centre down the street; so that centre is being closed.”

Burning Backlog

Tracking aircraft usage, sim sales plunged. After selling a record 78 FFSs in FY19 (April 2018-March 2019), an average of nearly 20 per quarter, and 49 in FY20, CAE recorded only two bookings in Q1 of FY21 (April-June). Simulator production was suspended for several weeks. Civil revenue was down nearly 50% from a year ago;  the full story is here.

At CAE’s 65 training centres, simulator utilisation averaged only 33% for the quarter and is continuing around 40%. A third of the sites suspended operations, and another 15 reduced capacity. “There was no choice,” said Leontidis. “These academies were considered schools, and most countries closed schools.”

Leontidis said the severe drop in training demand has not led to revisiting any long-term training deals with airlines, “with the exception of potentially one.” He added, “We’ve had a few cases where we had to write down simulators.”

“We haven’t had a lot of impact in Phoenix and Melbourne,” CAE’s two largest ab initio schools. “The issue we’re having is only one of borders. We’re having difficulty bringing new students and foreign students into Australia, in particular, and to some extent in the States. But the school in Phoenix lives primarily off the US airlines. Europe is different; most of our students sponsor themselves, so volume is down a little bit at the moment. I think it’s very temporary.”

Goodwin indicated there’s been little impact to FlightSafety’s simulator manufacturing thus far. “We’re pretty much sticking to our plans. The real impact will be when operators start delaying or cancelling orders for new aircraft, and right behind it the simulators. There aren’t many requests for proposal out there right now. Everybody is trying to minimise capital expenditures, to weather the storm.”

Alsim sold 45 training devices last year, and was anticipating selling 60 in 2020, but Jeffroy said the expectation now is for about 35.

Frasca said, “Nobody cancelled an order that was in place. We’ve had plenty of decisions delayed and some of them are coming through, but it’s resulted in a shrinking of the backlog. Our sales are definitely down from last year.”

Philip Adrian, CEO, said Multi Pilot Simulations had a different sales drop – triggered by the grounding in March 2019 of the Boeing 737 MAX aircraft. As airlines were transitioning to the MAX, the market for simulators for older-model 737s dried up. “There was very little appetite,” said Adrian. The company’s plan was to build eight 737 trainers and eight Airbus A320 models, but was able to produce only 10 devices. “It basically dried up half of our pipeline.” Now this year, he lamented, “the MAX return to service has been postponed, postponed, postponed.”

TRU Simulation + Training has been the most seriously impacted thus far, as parent Textron suspended operations at its Montréal commercial simulator production facility.  Click here for the full story.

Government Subsidies

MPS, FlightSafety, Frasca and Alsim report relatively few personnel cutbacks.

Adrian said, “Fortunately at this point we have not had to do any layoffs. We have had support from the Dutch government. We have kept our people busy.”

Goodwin said FlightSafety didn’t have any workforce reductions. “We were able to put a lot of the people on government work instead of commercial, which frankly dried up and hasn’t come back yet.”

Frasca described that “when the governor implemented restrictions, we weren’t shut down, but we were asked to get as many people working from home as possible. We managed to get probably 50 or 60 percent of our team working from home.” About 90% are back at the Illinois factory now.

Alsim’s Jeffroy told CAT, “The French government is very helpful at the moment, but we have to give the money back anyway.” She said a few temporary employees who had been brought in for surge work were released.

CAE, however, announced on 12 August plans to lay off 350 employees before November, about 200 in Montreal and the other 150 across its civil training network. The company has about 10,000 employees on six continents.

Training Landscape Changing

L3Harris’ Hogston said the pandemic “has accelerated many of the established training developments such as device-mix, distance learning and the training data journey as the training industry adapts to the new normal of remote and social-distanced learning as a standard part of a journey rather than an exception.”

At its several ab initio academies around the world, L3Harris shifted to remote training across large parts of the cadet ground school, and Hogston claimed “exam results as good or higher to those from before the pandemic with well over 96 percent first-time pass rate across all EASA modules.”

CAE defaulted to remote training at its academies as well. “They would allow us to fly the aircraft,” explained Leontidis, “but we couldn’t do the classroom training because of the regulations in most countries, how many people can be put into small spaces and so forth.” The FAA granted interim approvals to the revised curricula, “because they want to see how it goes.”

He welcomes the change. “With some experience and some investment in terms of technology, I think the operation is very favorable. There’s a couple of other benefits, for example, the real estate you need to carry comes down. An instructor doesn’t have to live in the community; you can be anywhere.”

“They still have to come for their simulator training, but it reduces the amount of time and cost. So I think these things are here to stay. Very much like the new VR, trying to figure out where it all fits into the curriculum appropriately,” he concluded.

Goodwin said FlightSafety is offering more distance-learning alternatives. “Anything the customers perceive as making their life more convenient, reducing travel, reducing their cost, is here to stay. There is always going to be demand for full-flight simulators. But one of the things we can do with technology is either lower the cost or increase the effectiveness of training.”

Will airlines be inclined to do less training in-house or more?

“We think it is an opportunity for airlines to shed some of their fixed costs. Obviously training outsourcing is one of them,” said Leontidis, who has structured numerous training joint venture with airlines. “There’ a lot of restructuring, and I think airlines are trying to fill out their business models. Normally, inflection points like this are important to looking at what you do when you’re busy and have a lot on your plate.”

MPS’ Adrian suggests airlines may opt more for localized training. “Now that airlines are concerned with both availability to travel and also the cost in operational expenses, we see a drive towards more localized screening solutions and other web-based solutions that do not require travel.” He said MPS is expanding its portfolio with remote screening devices. “That aligns with what the industry and regulatory bodies are looking at.”

“It’s a whole market shift from using a full-flight simulator for menial tasks,” Adrian added. “We’re looking at a blended learning environment where tasks are identified, the objectives are identified, and the right tool is matched to the training objective. With a blended learning environment, it will allow a training organization to ask, ‘For this training for the hydraulic system, do I need motion?’ If there is no impact on the flying ability, you should be able to offload that device.”

Frasca has been quite successful with its new entry-level Reconfigurable Training Device (RTD), but regulatory credits are an issue. “It’s found a niche and people are buying it,” said John Frasca. “It’s a very sophisticated device, has good aerodynamics, real Garmin software and so on.”

“What the schools are looking at is credits be damned because all the schools are putting too much time in the aircraft already. More than the minimum. So if you can go in the device, any device, you get value and they’ll use the device as much as possible. Then we go back to the authorities and say, ‘Look, it’s successful, can we get more credit?’”

CAE’s Leontidis agrees there need to be regulatory changes. “The training programs that are used today are not flexible. People don’t all learn the same. They don’t learn at the same speed. Do it in an objective way, do it with some standards. I think this would be a big enabler for the industry. It’s difficult to bring in new technologies, which is critical to bringing new ideas. But the demographic of people that we’re training today is a lot different. We train kids from all over the world. If a pilot masters the training curriculum that is prescribed, then we should be able to expand his curriculum so he can do some new things. There are ways to make this effective.”

Zooming for Sales

The pandemic restrictions on travel have changed the sales process as well.

“Ideally, prior to a sale, there are visits back and forth. We’re visiting them. They’re visiting us,” Frasca described. “We bring customers in for design reviews, milestones, acceptance. Now everyone’s gotten really good at videoconferencing. A lot of video, a lot of telephone and emails.” He said he recently visited a few customers in the US in person, using a company aircraft.

Remote troubleshooting of fielded devices is “putting more pressure on tools that we’ve had,” he added. “We’ve always done remote control of the simulator and had the ability to download software, monitor performance. Some of the newer devices are going out with a little higher integration in that area.”

Jeffroy said Alsim has created a showroom of all its products in the Paris area, and plans offering demonstrations beginning this month, but they are unsure if prospective customers can visit because of various country quarantines. “I think we still have to be patient.”

Another workstyle change: Alsim will exhibit at only two trade shows this year. “We usually go to 15.”

Adrian foresees “a future of a more virtual workforce. And that also gives opportunity because I can hire somebody from India or Australia or Canada or wherever. It gives a more global opportunity. I think it is a way to reinvent ourselves.”

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