After SPS fire, who will make the special bolts that keep U.S. aircraft flying?

Military planners and Philadelphia-area parts makers are trying to estimate how much the fire at the SPS Technologies parts plant in Abington last week may create shortages, delay U.S. aircraft manufacturing and repairs — and maybe open new opportunities for other suppliers.

”We are assessing the situation” and working with manufacturers “to determine the impact. We won’t know if alternate suppliers are necessary until the assessment is complete,” said Jake Boyer, spokesperson for the Defense Logistics Agency, based in Fort Belvoir, Va., which helps U.S. armed forces find and stockpile parts for new and aging equipment, mostly through its centers in Richmond, Va.; Columbus, Ohio; and Philadelphia.

He wouldn’t estimate how long that will take, noting potential shortages and solutions are “situationally dependent.”

Once selected by a branch of the armed forces, parts face testing rounds that can add months or years before a supplier is approved. SPS is one of a few, and in some cases the sole, supplier of specialized bolts, washers, assemblies, and other parts for some of the many parts that keep Apache Longbow and Blackhawk attack helicopters, Tomahawk missiles, F-15 fighter jets, Boeing Stratolifter cargo planes, and other aircraft flying.

“They have equipment that’s been around 100 years that may be hard to replace. Some of the big presses [at SPS] have been in that building since they started,” said Art Newcomb, owner of 17-employee C&L Rivet Co. in Hatboro, which makes commodity-quality fasteners that don’t directly compete with the specialized products engineered at SPS.

“They have other plants, but they’re not necessarily doing the same things,” Newcomb said. “New equipment today, say you need to replace a 50,000-pound press, you need a year and a half lead time. There used to be 10 [U.S.] manufacturers. Now there’s National Machinery in Tiffin, Ohio, and maybe a couple more. Or you go to Italy, Germany, the Swiss, the Japanese.” But that’s not necessarily quicker.

Another challenge is finding people to work the big machines. “The skilled labor force is diminishing with the aging population,” Newcomb said. “Our biggest hurdle is finding people, even if I have the machines, and the jobs. Tool- and die-making machinists are hard to find.” He’s already taken on an SPS worker left at least temporarily jobless by the fire.

Over the Abington plant’s long history, military-approved, precision-grade SPS parts have been used by Boeing, General Electric, Raytheon, and other manufacturers to bolt together fighter, bomber, and helicopter aircraft; missiles; warships; and other expensive military projects, as well as in civilian aerospace and aviation programs. The government also buys parts directly.

SPS also has factories in California and elsewhere. Its owner, Precision Castparts, an Oregon-based division of billionaire investor Warren Buffett’s Berkshire Hathaway, has metalworking facilities in many states and countries.

But Precision Castparts hasn’t made clear how or if it will make up for lost production at Abington, where factory sheds at the heart of the 105-year-old complex collapsed, and ruins have been leveled by heavy equipment. Street-facing office buildings, however, appeared to have survived the fire.

Once a family company founded and run by members of Montgomery County’s Hallowell family, SPS has cut its staff by more than half to around 475 since Precision Castparts took over 20 years ago.

Buffett admitted overpaying for Precision Castparts when he bought it for over $30 billion in 2016 and has been trying to cut costs while boosting profits from rising aerospace demand. The plant was cited by federal inspectors for failing to properly identify and speedily treat “ignitable waste” in 2023.

Even before the fire, some SPS veteran employees had moved to other manufacturers, such as publicly traded, independent specialty metals maker Carpenter Technology Corp., which is based in Philadelphia and has a large plant in Reading, and fastener-maker Penn Engineering of Danboro, Bucks County, one of a dozen U.S. industrial companies controlled by New York’s Ruttenberg family.

“Private equity has no economic model” to keep boosting profits while also reinvesting in an aging manufacturing plant, said Sam Thevanayagam, owner of Parts Life Inc. in Moorestown and DeVal Lifecycle Support in Northeast Philadelphia, two plants that “recreate” or arrange production of parts no longer made by original equipment manufacturers. “We have done about 200 parts like that. We have another 125 in process.”

Thevanayagam said it’s hard for buyers to respond to parts shortages on a short-term, ad-hoc basis. “Obsolescence is like whack-a-mole,” he said. Still, when the military needs a critical part, sometimes officials will find ways to speed approvals and give manufacturers extra incentives to meet rush orders. “Any problem can be solved by money,” he said.

While “the supply chain has resiliency and redundancy, there are still patches” where the military may need new suppliers after the fire, said Chris Scafario, president of the Delaware Valley Industrial Resource Center, which directs federal manufacturing assistance funds to area companies such as Parts Life and C&L.

While big contractors are focused on winning the Pentagon’s approval to build new weapons systems, thousands of parts are needed, for example, for durable, decades-old Air Force jets. As with iPhones, “after a couple of years, no one is making the parts,” and the armed services go looking for new suppliers, such as Thevanayagram’s companies, Scafario said.

Solutions go beyond a well-stocked warehouse. Navy engineers in Philadelphia, in particular, have been developing “additive manufacturing” that could “3D print” some replacement hardware right on a warship, Scafario said.

Procurement specialists warn that it can take months, even a year or more, to win Defense Logistics Agency and individual military service approvals for new parts production.

“For commercial aerospace and other commercial clients, it’s a little bit easier,” said Sylvia Wower, the Delaware Valley center’s vice president. “They do need AS9100 certification,” so the plant’s processes meet the international manufacturing standards for aviation.

The military services in the past have had backup suppliers. For any critical part whose inventories will fall without the Abington plant, “this is the time to create one,” Wower said.