Would an installation of navigation equipment that requires the modification of the instrument panel be consider an alteration?
ANSWER: Yes, it would be considered an alteration, and would require the use of approved data to perform the alteration.
You cannot alter a type certificated aircraft unless you use data approved by the FAA. This data can be in the form of an Supplemental Type Certificate (STC), data that is approved by an FAA Designated Engineering Representative (DER) on a FAA Form 8110-3, or data approved by the FAA by a field approval documented on an FAA Form 337.
Also, you need to consider if the alteration is a major or minor alteration. This would determine how the completion of the alteration is recorded.
Click on this link Aircraft Alterations where you will find more information and a decision chart. This will help you determine whether the alteration is major or minor.