Counterfeit Electronic Parts: A Growing, Global Concern

03 November 2015

Counterfeit parts include any electronic component that misrepresents its characteristics, performance or place of origin. In a global supply chain, counterfeiting is a major concern — one that not even the most reputable manufacturers are immune from.

The Scope of the Problem

Counterfeit parts are often recycled or scrapped components that are marketed as new, or inexpensive, generic parts that have been relabelled and resold as something more expensive. Don't think counterfeit parts are a problem that affects your business? Consider the following:

A 2012 report by the Senate Armed Services Committee found more than 1 million counterfeit parts in the military supply chain — parts that ultimately ended up in computers, aircraft and weaponry.
An estimated $250 billion is lost each year by consumer and industrial businesses as a result of electronics counterfeiting, according to IndustryWeek.
The same IndustryWeek report also notes that in a typical year, counterfeiting costs the semiconductor industry $75 billion, and automotive manufacturers $3 billion.

In addition to the real financial implications of electronics counterfeiting, the practice also puts innocent lives at risk. Counterfeit parts aren't subject to the same stringent testing that legitimate electronics are, which increases the potential for failure or error at a critical juncture.

Parts Counterfeiting in the Aerospace Industry

Parts counterfeiting is especially prevalent in the aerospace and defence industries. To combat this growing problem, several standards are available for contractors who wish to implement a quality management system to detect counterfeit parts:

AS5553 — AS5553 is a flexible standard that outlines a set of best practices for component design and verification, procurement and supplier management, and material management. The goal is to keep counterfeit parts out of aerospace equipment. It also covers strategies for responding when non-conforming parts are identified. AS5553 is intended for use by any organization that develops, purchases or sells electronic components meant for integration into aerospace assemblies or equipment.

Both NASA and the U.S. Department of Defense have adopted it — compliance is a requirement for doing business with either agency. Even those organizations not requiring it can benefit from compliance. The standard is customisable to deliver benefits to any operation in which counterfeit parts are a concern.

AS6081 — AS6081 is a related standard designed specifically for aerospace parts distributors. It provides a set of standardised processes and requirements that can help identify counterfeit parts and keep them out of the supply chain. It also covers reporting, control and risk management strategies for when counterfeit parts are found.

Like all ISO-derived standards, AS5553 and AS6081 can be scaled for use in organizations of any size. Compliance gives you a set of tools to facilitate the growth of your business by streamlining processes and improving efficiency, while continuing to keep the aerospace supply chain free of counterfeit electronic parts.

For more information about either standard, or about the role NQA can play in the certification process, contact us today. Download a copy of our handy Counterfeit Parts Checklist.