Thursday , August 16 2018

One third of Pratt-powered A320neo jets faulty: Airbus

Bloomberg

Airbus SE said almost a third of its Pratt & Whitney-powered A320neo aircraft are affected by a new engine glitch that has forced the European planemaker to halt some deliveries of the popular narrowbody jet.
Of the 113 Pratt-powered aircraft in operation worldwide, about 30 percent are equipped with either one or two faulty engines, the planemaker said in an emailed statement on Monday. The issues are different from faults that have previously afflicted the engine type and are from the most recent batches to come off the engine-maker’s production line.
The European manufacturer has been forced to suspend deliveries of A320neos with Pratt engines, according to IndiGo, the Indian low-cost airline that’s the plane’s biggest customer. The disclosure of new problems with the Pratt engines late last week marks a blow for the A320neo, Airbus’s best-selling plane. Chief Executive Officer Tom Enders had recently signalled the company had moved past the issues that have held back deliveries and disrupted airline schedules since the single-aisle jet’s introduction two years ago.
Airbus shares fell after Bloomberg News reported on the number of Airbus planes affected. They were down 1.3 percent to 82.24 euros as of 10:43 a.m. in Paris. That valued the company at 63.7 billion euros ($78.2 billion).
InterGlobe Aviation Ltd., which operates IndiGo, declined as much as 1.7 percent in Mumbai on Monday. Pratt parent United Technologies Corp. fell 1.9 percent, the biggest slide of any member of the Dow Jones Industrial Average. Seventeen jets operated by Indigo and rival Go Airlines India Ltd. are impacted by the issue, Airbus said in the statement. Indigo said it had suffered three in-flight shutdowns, while pilots have had to turn back before taking off in three other instances. The airline is also working with Pratt to swap out some of the faulty engines. Replacing the engines is the “best possible precautionary measure” to avoid further mishaps, IndiGo spokesman Ajay Jasra said.

MORE FUEL-EFFICIENT
It’s impossible to overestimate the importance of the A320 for Airbus. It put the European planemaker on the map three decades ago, allowing the company to go from a speck in Boeing Co.’s rear-view mirror to powerful equal in what has become a de-facto duopoly in the global civil-aircraft market. Airbus churns out more than 50 of the aircraft each month, and the promise of the neo with its more fuel-efficient engines turned the model into the fastest seller in commercial aviation history, forcing Boeing to respond with a refreshed 737.
Airbus has traditionally offered two engine options on the A320, and the company maintained that approach on the neo. Customers can choose between the Pratt & Whitney model and a type built by the CFM joint venture between General Electric Co. and France’s Safran SA. For Pratt, the introduction of the two-year-old neo was a chance to solidify its position in the lucrative market for single-aisle planes, which form the backbone of most global airline fleets.
Pratt, a unit of United Technologies Corp, invested $10 billion to develop the geared turbofan, now its most important product. The company has been trying to move past earlier snags, including a cooling problem that marred its commercial introduction in early 2016, and subsequent durability issues and delivery delays. Pratt said that the problem was isolated to “a limited subpopulation” of the engines, and had to do with a “knife edge” compressor seal.
COMPENSATION COSTS
If the latest problem leads to penalty payments to IndiGo and other customers, it wouldn’t be the first time Pratt was on the hook financially. Greg Hayes, chief executive officer of United Technologies, said last April that Pratt incurred costs to retrofit the engines to address durability issues, and related to “helping the airlines through some of this.” He didn’t specify the exact amount, but he said “it’s not material.”
The early glitches at Pratt led many customers to wait on the sidelines: The competing CFM engine outsold the GTF on the A320neo by a 10-to-1 margin in early 2017. Pratt won several key orders late in the year as the earlier issues subsided, and executives at Airbus and United Technologies said the manufacturer seemed to be moving on from a difficult chapter.
While Pratt works on a fix, IndiGo said it will take delivery of older, less-efficient A320ceos to fuel its growth. Pratt is also working closely with IndiGo to provide replacement engines, having replaced 69 of them in the past 18 months.

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