Holding on to components and assemblies that are no longer in production can drain resources and take up valuable space.
Putting an inventory management process in place to properly control obsolescence and “aging” parts will enhance efficiencies for your organization, and ultimately save time and money.
Many businesses today, in all general industries, are prioritizing keeping their operations running smoothly. That being said, whether managing a manufacturing facility, a fleet of vehicles, or an intricate IT infrastructure, one relationship which sometimes creeps up on you is spare parts obsolescence.
Sometimes spare parts become obsolete and when critical spare parts become obsolete, this can often lead to expensive downtimes, lagged repairs, and unhappy teams.
Effective spare parts obsolescence management means being proactive about spare parts and ensuring operations are seamless, while also maintaining a competitive edge.
In this article, we will take a look at spare parts obsolescence, why it matters, and how businesses can effectively implement efficient strategies to manage it. We will break down spare parts obsolescence, illustrate with real-world examples, and provide solutions and strategies to encourage participation in the “spare parts obsolescence” program and help your organization to avoid managing obsolete inventory.
What Is Spare Parts Obsolescence ?
Discontinued spare parts can jeopardize manufacturing operations since they are often unavailable. If a machine breaks down and the required spare part is out of stock, the absence of crucial information about the part’s lifecycle status, obsolescence risk, and replacement product can result in prolonged equipment downtime and expensive production delays.
When a part or component necessary to maintain or repair equipment is no longer manufactured, available, or supported by the supplier, it is said to have become obsolete.
Spare parts can become obsolete for a number of reasons, including technology improvements, changing market demand and suppliers dropping older product lines.
When spare parts become obsolescent, the business risks loss of equipment time, incurring further costs from searching for alternative parts, and premature replacement of entire systems.
Why it matters?
Spare parts obsolescence matters for a manufacturing organization because it directly impacts operational efficiency, cost management, and customer satisfaction. Overstocking spare parts leads to waste and negatively affects the efficiency of MRO inventory management. Thus, it is crucial to have a clear understanding of why this is important:
- Downtime Reduction – Obsolete spare parts can halt production if replacements are unavailable, leading to costly downtime. Proactive management ensures critical components are accessible, maintaining smooth operations.
- Cost Control – When parts become obsolete, sourcing alternatives or redesigning systems can be expensive. Planning for obsolescence minimizes unexpected costs by identifying at-risk parts early and securing inventory or substitutes.
- Supply Chain Reliability – As suppliers phase out older parts, reliance on unreliable or counterfeit sources increases. Managing obsolescence ensures a stable supply chain, reducing risks of delays or quality issues.
- Operational Efficiency – When obsolete parts are identified and replaced proactively, it helps streamline maintenance operations, ensuring the organization can maintain consistent productivity and reduce maintenance delays.
When does a spare part become obsolete?
When a spare part reaches the end of its life cycle and is no longer manufactured, it is obsolete or discontinued or when it no longer meets the operational needs of the equipment or system it is used for and several factors can contribute to this obsolescence:
Regulatory or Safety Changes – If at any time a part no longer meets new regulations, safety requirements or compliance requirements, it will be rendered obsolete.
Manufacturers may be required to exchange or replace the part by a newer version of itself that has complied with new regulations. Over time regulatory requirements may change which may also make certain spare parts to be obsolete.
For Example: In the automotive industry, older airbags may not comply with new requirements for deployment timing or sensor compatibility. As a result, manufacturers must replace these outdated airbags with newer models that meet the latest safety regulations to ensure compliance and passenger protection.End of Production or Technology Lifecycle – Spare parts related to equipment or systems that have reached the end of their production or technological lifecycle are considered obsolete. This happens when the equipment is no longer in production, or newer models with advanced technology replace it.
For Example: Legacy mainframe computers became obsolete as production ended, and spare parts like hard drives and memory units are no longer supported. Companies relying on these systems must upgrade to modern technology to maintain operations.
Incompatibility with Updated Equipment – As machines and systems advance, older parts become obsolete as they do not work properly or even fit the upgraded equipment. Newer models are often equipped with newer technologies, improved interfaces, added features, or altogether new specifications that necessitate redesigned parts.
For Example: As printer technology evolves, older ink cartridges become obsolete when they’re incompatible with newer models featuring advanced designs and features.
Why it is critical for the Manufacturing Industry?
In addition to consistent servicing and lubrication, a good spare parts program is also required for the operation of your equipment at optimal levels. This is true in both, small and large companies.
It has never been more strategic to have an effective and stable spare parts program as manufacturing companies are dealing with disruption throughout the supply chain space.
An improper, unstable spare parts program can result in insufficient parts and an incomplete inventory forcing your business to experience maverick spends and unwanted downtime.
So, regardless of the machinery you have, general equipment, packaging related, or even a liquid filling system, appropriate spare parts management is important in keeping your business operational and functional in order to grow your business.
Here’s why obsolescence management is particularly vital for manufacturers:
- Asset Lifecycle Management – Effective obsolescence management extends equipment life and maximizes return on capital investments. It enables manufacturers to plan equipment upgrades strategically rather than being forced into premature replacements due to parts unavailability.
- Cost Escalation – Obsolescence creates a costly spiral. Emergency sourcing of discontinued parts through suppliers can cost 5-10 times the original price. Rush orders for custom manufacturing or reverse engineering can be even more expensive. These reactive costs far exceed the investment in proactive obsolescence management.
- Operational Continuity – Manufacturing equipment often has lifespans of 20-30 years, while individual components may become obsolete within 5-10 years. When a critical spare part is no longer available, it can force prolonged halts in production processes that cascades through production schedules. A single obsolete component can shut down an entire production line, leading to missed deliveries and damaged customer relationships.
For Example: A major automotive manufacturer experienced a 3-day production shutdown when a specialized servo motor controller from the 1990s failed on their paint line. The original manufacturer had discontinued the part 5 years earlier. While they scrambled to find a replacement, the entire plant stopped producing vehicles, costing approximately $15 million in lost production and forcing them to pay overtime to catch up on orders.
The Challenges of Spare Parts Obsolescence
Dealing with spare parts obsolescence is no easy task. There are many challenges faced by businesses: –
- Rapid Technological Advancements – Newer, faster and more efficient parts are always being developed and older parts are becoming outdated. As an example, a business with an older IT infrastructure may discover that replacement parts for its server are no longer produced due to the movement toward cloud computing.
- Supplier Discontinuation – Suppliers may decide to discontinue parts based on a lack of demand, expensive manufacturing costs, or newer product lines.
- Poor Inventory Visibility – Without visibility over a certain period of time a business may not realize that a part is becoming obsolete until it’s too late to stock up or find a replacement.
- Complex Supply Chains – Even if the demand can be forecasted, the global nature of supply chains can make it impossible to predict whether a part will be available when it is needed especially when multiple vendors in different parts of the world are involved.
Verdantis' Spareseek AI
Leveraging AI for alternate part extraction from either the OEM’s catalogue and the world wide web. Knowledge graph for equipment and spare parts, locating the availability and current status of the last changes and repairs.
Alternate part recommendation for any spare part (critical/non-critical) through the web. Spareseek AI also helps you to cater to the problems from the obsolete spare parts which are there in the inventory and it won’t be used for the manufacturing processes in the upcoming times. It helps you to locate those spare parts and ensures you save inventory carrying costs.
Final Thoughts...
Spare parts obsolescence may feel overwhelming, but with the right set of strategies, it’s a challenge that can be tackled.
By efficiently utilizing data management systems, building robust BOMs, creating relationships with suppliers, and anticipating alternatives, organizations can lessen downtime, save costs, and create efficiencies. No matter if you are a manufacturing plant, a logistics company, healthcare institution, excess obsolescence is an investment in the organization’s future.
Don’t wait for obsolescence to hold you hostage. Begin implementing the tools needed today to turn obsolescence into a potential opportunity.
