Spare the cost, share the parts

Signed in 2015 by 11 EDA countries (Belgium, Cyprus, Finland, France, Greece, Netherlands, Portugal, Romania, Slovenia, Spain, and Sweden) as well as Norway (which has signed an Administrative Arrangement with the Agency), the SoSP project’s aim is straightforward: to quickly exchange parts among nations whose inventories are in short supply, or which can’t be immediately purchased from industry. The whole set-up is voluntary among the 12, based on bilateral agreements and a system of service-or-equivalent-value exchange - meaning without financial transactions between participating Member States.

“Actually, we ought to re-name this project because its current title, Sharing of Spare Parts, doesn’t’ fully reflect all the benefits it is providing,” said Martin Huber, half-jokingly. Huber is EDA’s Project Officer for Logistics. “SoSP is not just about spare parts but functions as a simplified logistics system that gets around a lot of the delays and paperwork linked to traditional spare parts management. And we’re aiming to expand it beyond our members’ Air Forces to other services as well, which would be a significant evolution.”

SoSP’s core idea rests on its system of bartering, which offers five forms of compensation for the lending nation. These entail the following options:

• receive back exactly the same part, in ready-to-use condition;
• receive a similar part: a green vehicle goes out, a blue one comes back;
• agree a “balancing” arrangement where both parties place the lent part’s value on a running list of items whose total assigned value is cleared by year-end – or carried forward to the next year if the two nations tend to exchange parts regularly
• reimburse, where one national body simply pays for the part within 60 days;
• postpone the decision until end-of-year when both parties have to agree on one of the above four methods of compensation. 

SoSP’s set of barter choices offer its nations maximum flexibility. Belgium and the Netherlands exchange a lot of parts, so they tend to use the balancing option, either clearing their accounts at year-end or carrying it forward into the new year. Other nations opt for the “postponed” method, which is mission-oriented and thus makes it faster and simpler for bilateral in-theatre exchanges between the nations.

SoSP’s barter system also lends itself to the various weapon system communities spread across Europe such as those militaries with aging F-16 fighters in their inventory: the nations use it to exchange parts that are not available on the market.

Critically, SoSP also covers services. “This is quite important,” Huber added. “For example, if an aircraft breaks down somewhere, normally the nation that owns it would have to directly recover it. But under SoSP, it can engage a project partner military to do it instead.”

The SoSP project sees around 100-200 spare parts exchanged bilaterally each year. While that may not sound like a lot, the parts that tend to be exchanged are expensive or critical to system performance such as landing gear or aircraft brake parts.

“We are getting more attention from other EDA Member States regarding these bartering methods because of the financial planning implications. Traditionally, under the usual rules a military’s ultimate purchasing authority goes back to that country’s Ministry of Finance, which can often mean that your Defence Ministry has to request the financial budget for spare parts for the following year. SoSP might help to skirt around the delay.” 

Simplicity rules

One of the SoSP project’s core strengths is its simplicity, particularly for operational environments since “during missions you often don’t always have the technical logisticians you need on site,” observed Huber.  

SoSP offers a standard and simple template that pilots or crew can fill out on the spot, leaving the more official and detailed forms to be filled out later back home. It was developed specifically for military use as opposed to formal procurement procedures with contractors, precisely to move around them and their longer timelines, and the expense of shipping out parts from a contractor’s warehouse, which may be thousands of miles away.

Indeed, the whole SoSP process has just six steps, from request to final compensation. 

“We excluded all the things we don’t need such as multiple managerial levels and decision points. The beating heart of the process – our ‘customer support manual’ – is nothing more than a list of contacts.  So, I can contact Thomas in Norway for an F-16 widget or Carl in Germany for an A400 part. That’s it.”

The only obligation of the SoSP member nations is to keep their contact list updated and to decide the level of entry regarding their contacts – either at Ministry of Defence level, or allowing the caller to go directly to the parts expert within their Logistics Command. Revealingly, “all 12 of our SoSP members go for the lower-level access to the exact point-of-contact,” noted Huber.

Looking ahead

So, what next?  SoSP’s project lifespan is 10 years – until 2025 – and the group is mulling how to take it forward.  EDA, which manages the project, has recently started a dialogue with the SoSP nations on how to prolong and expand its functionality.

One idea is to promote SoSP as a tool to help Europe’s militaries reduce their carbon footprint as part of the EU’s green policy. “There is good potential here for the military to do that. When you need a spare part in the field, traditionally the request has to be filled back home and then the part is flown out to the requesting military unit, wherever it is across the world. Exchanging parts in the field via SoSP would obviously avoid all the related carbon emissions caused by the part’s long-haul transport.”

Another idea is to expand SoSP’s barter options to include one of the virtual service-as-currency units used by other multi-nation groupings in Europe for example SEOS (“Surface Exchange Of Service”) with aunit equals €300.

Currently, for historical reasons, SoSP is mostly used by its members’ Air Forces. “Getting the maritime folks on board is not so feasible because navies have strong spare part contracts with private contractors, which have agents in each port. But it’s a different story for land services,” said Huber.

“We have developed a process handbook – an aide memoire  – that describes perfectly the process and the different  responsibilities..  It was completed in 2019 and tested in an army live exercise environment. And that is our target market for the future,” he said.