Economics and Safety in Maintenance Outsourcing

Factors which affect the decision to either perform maintenance in-house or subcontract it to an outside organization are complex, and range from purely objective calculations of costs and benefits to the subtleties of behavioral opportunism and risk. Thus safety and economics can be highly interrelated when outsourcing is at issue. Using aircraft maintenance in the civil air transport industry as an example, this paper discusses subtle but important economic factors which should be considered when an outsourcing decision is at hand.