Volume 3, Issue 2

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Survey Benchmarks Impact of Counterfeit Parts on Companies

Electronics Industry Tackles Counterfeit Parts Issue

New Tool Available to Combat Counterfeit Electronic Parts

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New Tool Available to Combat Counterfeit Electronic Parts

While manufacturers in a number of industries struggle with counterfeit parts, members of the aerospace and defense industry have their own unique challenges. Unlike a cell phone, which will probably be obsolete in three years, many of the products built by aerospace and defense companies have long life spans. Therefore, the need for replacement parts is much higher, and many times they’re no longer available from the manufacturer of the original part. That’s when procurement managers turn to brokers—and run the risk of buying counterfeit parts.

Brokers are a significant source of counterfeits—one study by the U.S. Department of Commerce shows brokers as being the largest source by far of counterfeit parts in which it was documented that they were being sold. In the past, the standard advice to avoid counterfeits was “know your supplier.” But as the number of counterfeits grows to alarming levels, that’s only one of many practices companies need to adopt according to SAE International, which recently released its standard AS5553, Counterfeit Electronic Parts; Avoidance, Detection, Mitigation, and Disposition. The standard outlines recommended practices and procedures designed to help companies reduce the chances of receiving or using counterfeit electronic components. These range from processes for determining the availability of parts and assessing potential suppliers to processes for verifying components and controlling suspect and confirmed counterfeit parts.

According to Bruce Mahone, director of Washington operations, aerospace, for SAE International, the organization’s new counterfeit electronic parts standard was created at the behest of NASA, which was concerned about the rising number of counterfeit electronic parts in the supply chain.

“Not only is it difficult to get parts from the original manufacturer for older aircraft and space systems, but the counterfeit business, especially coming from Asia, is very strong,” says Mahone.

Counterfeit electronic components can range from parts that are clearly fakes to those that are hard to distinguish from the real item. Types of counterfeits include parts that have been remarked, components that were salvaged from old assemblies and defective parts that should have been destroyed by the original manufacturer. Or they are parts that are sold as new, but are really refurbished, with much more limited life spans than the new components they claim to be.

AS5553 was designed to combat the influx of these types of these problem parts. Even though it was created for the aerospace and defense industry, it can be adopted by any company that is dealing with counterfeit electronic parts in its operations.

However, given the standard’s stringent requirements, it may not be as practical for industries such as consumer electronics, where turnaround times are vital, unlike aerospace and defense, where the focus is on developing mission- and life-critical aircraft and spacecraft.

“Counterfeits are a concern for all electronics, but it’s just a more critical, dangerous and expensive concern in aerospace,” says Mahone.

Now that the counterfeit electronics standard has been published, SAE is beginning work on a companion standard that will focus on alleviating similar problems with counterfeit mechanical parts such as fasteners and fluid fittings.

The new standard will be comparable to AS5553, says Mahone. “It will be similar in a lot of ways. And the paperwork part would be similar. But the testing would be different and you’d be dealing with different types of companies. I think different people would have the expertise to not only manufacture but also try to counterfeit mechanical parts.”

While work on the mechanical parts standard is in the early discussion phase, the counterfeit electronic components standard is already in use.

“It has broad support from NASA, the Federal Aviation Administration, the Department of Defense,” Mahone says. “We expect it to be widely used globally and we expect it to be the global standard for avoiding counterfeit electronic parts.”

To order AS5553, Counterfeit Electronic Parts; Avoidance, Detection, Mitigation, and Disposition, visit: global.ihs.com