Pratt & Whitney is facing another engine production problem, this time delivery suspensions by Airbus after India’s largest airline, Air India reported in-flight shutdowns.
The company has been forced to suspend some deliveries of its A320neo jet following an issue with the engines supplied by the United Technologies Corp. subsidiary.
The Indian airline disclosed Sunday three shutdowns and said pilots have had to turn back before taking off three other times. A statement released by IndiGo spokesman Ajay Jasra said that replacing the engines is the “best possible precautionary measure” to avoid further mishaps.
A whopping $10 billion was spent by UTC in developing the geared turbofan engine, which is Pratt’s most important product. It touts the engine as quieter as and more fuel-efficient than those produced by competitors.
UTC has 8,000 engines on order, but the chronic production problems undermine efforts by UTC to move quickly on delivering engines to its customers. As Pratt works on a fix, IndiGo said it will take delivery of older, less-efficient A320ceos to fuel its growth, Bloomberg reported. Pratt is also working with IndiGo to provide replacement engines and has replaced 69 in the past 18 months.
A statement was released by IndiGo on Saturday saying it canceled some flights after the European Aviation Safety Agency warned of a new issue with the engines and said it was investigating. These problems arise in contrast with commentary by several industry analysts who said 2018 could be the year when UTC’s engine production problems diminish.
According to analyst Matthew McConnell of RBC Capital Markets, he believes UTC is positioned for double-digit operating profit over the next decade, citing as one of the reasons the “underappreciated long-term growth opportunity” of the geared turbofan. But he said it’s “too early to declare victory” on engine problems.
An announcement was made by UTC in October 2016 in which it said that it appointed an aerospace executive as operations chief at Pratt & Whitney to oversee the supply chain and delivery of equipment, including the engine. UTC took a $196 million charge related to the delivery of spare engines to Bombardier and Airbus, which had planes that were grounded for “unacceptably long time periods,” Hayes said at the time.
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