The Hidden Dangers of Counterfeit Parts in Critical Equipment Applications
Paul McGill, Cofounder, McGill Industries
Posted 10/21/2025
Knock-off apparel or a fake Rolex watch sold by a street vendor are well-known examples of counterfeit goods, and those who unwittingly buy them usually lose some of their hard-earned money. Lesser known are counterfeit parts for industrial applications, and these carry far greater consequences.
Highlights:
- Counterfeit parts can be difficult to detect
- Using such parts can cause major accidents
- The small savings can be overshadowed by major losses
- Counterfeit parts can cost both time and money
Counterfeit parts are a massive problem when they are used in critical equipment that requires reliability, durability, and precision.
We think of counterfeit parts as obvious fakes, easy to identify, and therefore not a challenge to avoid. However, many counterfeit parts, so-called gray goods, are made to look and at first glance, function exactly like the original, but available at much lower cost. Some may even be original parts past their intended life, refurbished and repackaged.
Catastrophic Failure
The most visible results of using counterfeit parts are when these lead to catastrophic failures resulting in death or injury. Such aircraft parts fraud has occurred over decades, and the incidents are well-documented.
Just one of the many incidents is the September 1989 crash of Partnair Flight 394, which resulted in the deaths of all 55 people aboard the plane. Investigations uncovered that counterfeit bolts (not made to the purported specifications required) played a significant role in that crash.
Even aerospace is not exempt from the scourge of counterfeit parts, which can have grave national security, scientific, and financial consequences.
Unpredictable Performance
The problems caused by most counterfeit parts are not spectacular or newsworthy events, but rather unpredictable performance in industrial applications.
Failure During Operational Stress
Visual inspection and even initial testing may not reveal the substandard quality of a counterfeit part. It may even work perfectly, until it no longer does.
Parts used in industry may be subject to friction, heat, vibration, pressure, or centrifugal forces on a continuous basis.
A subpar counterfeit part, not designed for such stresses, can fail at any time. Not only will this interrupt production on its own, but one part that fails unexpectedly can damage other components in the same plant.
For example, counterfeit brake pads are often made with substandard materials (sometimes even compressed wood pulp). Obviously, under hard braking or just prolonged use, these pads will fail or even catch fire. While potentially catastrophic, counterfeit brake pads most often are revealed by premature loss of performance.
Random Malfunctions
Some parts will malfunction seemingly at random, often triggered by slight changes in the operating environment. These malfunctions can range from a complete breakdown to erratic performance.
Because the events are so random, it may prove challenging to pinpoint the cause, or even the individual part causing the problem.
Both unexpected failures and random malfunctions can severely curtail operations, causing disruptions to production, and leading to financial losses.
Electronic Components
Electronic systems that measure and use data are counterfeited even more often than physical machine parts. The more complex the system, the more critical the accurate performance of the electronic components are.
Sensors And Switches
Sensors, switches, and memory chips are critical to the optimal functioning of any reasonably complex machine. A sensor with imperfect parameters, or a switch that is out by a microsecond can disrupt the operations of an entire assembly line.
Because electronic components are so ubiquitous and interconnected, tracing the offending part can be difficult and time-consuming. The few dollars saved on a fake switch can cause massive financial losses.
Scheduled Maintenance
Many sensors are used to measure the performance, wear and tear, or operational parameters of different components. Their function is to provide sufficient warning when maintenance or a replacement will be needed, so production can be planned around that.
A faulty sensor can fail to detect the need for maintenance or repair, leading to unplanned stoppages or even major breakdowns. The opposite, when sensors give false feedback, can lead to unnecessary stoppages.
Warranties And Regulatory Obligations
The use of counterfeit parts in critical systems can have consequences that transcend operational breakdowns or accidents.
Warranties
Most industrial installations have warranties by the manufacturers of the various components that are used. These warranties are usually dependent on using only approved components during maintenance and repairs. If a counterfeit part is accidentally or deliberately used, this can void such warranties during any breakdown.
Regulatory Obligations
Many industries such as public transport, energy, healthcare, and defense procurement are strictly regulated. Using counterfeit parts, whether these lead to problems or not, can trigger severe regulatory penalties.
Minor Savings Risking Major Losses
The risks inherent in saving a few dollars by using components of dubious origin makes no sense in any industry that depends on safety, durability, and reliability.
The financial losses suffered as a result of mechanical breakdown or regulatory penalties will most likely be far less than the reputational damage this will cause.
Because bad actors are willing to jeopardize the lives and incomes of others to make “easy” money from counterfeit parts, buyers must be astutely aware. Deeply discounted prices on critical equipment should be an immediate giveaway that something isn’t right, but that’s not always the “tell”. The best first line for reducing risk is to purchase parts from well-established, known, and trusted sources.
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