By Scott Hamilton
June 15, 2020, © Leeham News: John Slattery, the CEO of Embraer Commercial Aviation, was named CEO of GE Aviation, it was announced today.
Arjan Meijer is the new President and CEO succeeding Slattery. Slattery succeeds David Joyce, who is retiring. Slattery’s appointment is effective July 13.
Slattery devoted much of the last year trying to win approval of the proposed Boeing-Embraer joint venture, Boeing Brasil-Commercial. Boeing terminated the agreement April 25, claiming Embraer failed to meet all required terms and conditions. Embraer claims it met the conditions. Both took the dispute to arbitration.
Slattery had been designated CEO of Boeing Brasil. After the deal’s collapse, his departure from Embraer was expected.
June 15, 2020, © Leeham News: The jet engine division of Rolls-Royce faces an uncertain future because of its own problems, exacerbated by the impact of COVID-19 on commercial airlines.
Beset by problems with its Trent 1000, Boeing 787 engine, hampered by a huge error in judgment to withdraw from a joint venture with Pratt & Whitney, beset by the premature termination of the Airbus A380 program and now facing a long-term impact of the coronavirus crisis, Rolls is an engine maker with few opportunities.
June 8, 2020, © Leeham News: Pratt & Whitney struggled since its new Geared Turbo Fan engine entered service in 2016 to fix technical, reliability and operational issues.
Plagued by premature engine removals as parts, other than the gear box, failed, Airbus A320neos stacked up in Toulouse and Hamburg while new engines were diverted to operators with aircraft out of service.
India’s regulator issued a grounding order of GTF-powered neos. Shop visits for repairs and modifications overwhelmed PW. The mess cost PW parent United Technologies (now Raytheon Technologies, following a merger) billions of dollars.
Working its way out of this mess was forecast to take into 2021.
Now, with COVID-19 impacts grounding airliners by the thousands, PW is using this as an opportunity to speed replacement and reworked engine deliveries.
Performance Improvement Packages (PIPs) will be ready this summer.
“If there is any silver lining in the environment we’re in today, it is likely around the GTF and the retrofit,” Raytheon CFO Toby O’Brien said during a UBS webcast last week. “We are utilizing available shop capacity to fix the issues in the fleet. Our goal is to have GTF engines with enhancements by the end of the year as the recovery plays out.”
Now open to all readers.
By Scott Hamilton
May 5, 2020, © Leeham News: The COVID crisis will damage the aerospace aftermarket in ways that are only beginning to be understood.
Engine companies like CFM, GE Aviation, Pratt & Whitney and Rolls-Royce, rely on aftermarket sales as the key component of their business plans.
The research and development money that goes into an engine consumes such huge amounts of cash that the OEMs don’t recoup their costs for 10-20 years. The aftermarket for parts, maintenance, repair and overhaul is where they make their profits in the meantime.
But this is seriously threatened by the virus crisis.
“The aftermarket for key programs took 4+ years to return to 2008 levels out of the Great Financial Crisis, and that was with traffic decline at a fraction of the declines today,” Bernstein Research wrote in a May 4 note to clients.
By Scott Hamilton
April 2, 2020, © Leeham News: Boeing’s New Midmarket Airplane, or a new concept, is the last thing on the plate right now.
But Boeing’s future product strategy nevertheless requires long-term thinking even as the short- to medium-term is in chaos.
Interviews were conducted March 2 at a major aerospace conference in Austin (TX), just days before the coronavirus crisis exploded exponentially across the globe.
The CEO of the major lessor, Avolon, declared the NMA dead and predicted a new single-aisle airplane will be Boeing’s next project.
An executive of Pratt & Whitney offered a similar view.
Now open for all readers.
By Scott Hamilton
March 30, 2020, © Leeham News: Pratt & Whitney is concurrently developing what might be termed the next generation GTF. This is an advancement over the current engine, but with more thrust and better fuel economics.
“We have been discussing with Airbus for some time, an improvement to the current configuration or our expected configuration,” Deurloo said. “I think that’s a testament to the geared architecture. It’s given us some runway to do a little bit more on that engine.
PW has been in conversation with Airbus for the last few years about an engine that will take configuration at the end of this year, and put in an improvement.
By Scott Hamilton
March 16, 2020, © Leeham News: “I can tell you from our perspective, we’re kind of sick and tired of new, new technology. It’s not proven to be the home run.”
This blunt assessment comes from the chief executive officer of the big aircraft lessor, Avolon.
Domhnal Slattery, the CEO, was giving his critique of whether Boeing should launch a new airplane once the 737 MAX crisis is over.
Boeing was on a path to decide whether to launch the New Midmarket Airplane when the MAX was grounded one year ago this month.
Airbus was waiting for Boeing to move before deciding how to respond.
January 3, 2020, ©. Leeham News: We continue our series why e in ePlane shall stand for environment and not electric.
Our target is to lower air transport’s environmental footprint and we can achieve this more efficiently by using established technologies. As an example, I will describe a very promising concept that has fallen out of focus due to the hype around everything hybrid and electric.
By Vincent Valery
Dec. 2, 2019, © Leeham News: Rolls-Royce continues to be in the spotlight for the Trent 1000 durability issues, with no end in sight. The engine manufacturer recently increased the total disruption cost estimate to £2.4bn.
The engine-related charges and substantial research and development expenditures have raised questions about Rolls-Royce’s financial health. As of the end of 2018, the company had a net negative £1bn equity on its balance sheet.
However, the company has a market capitalization of around £14bn and holds a credit rating comfortably in Investment Grade territory.
This article analyzes the reasons for the disconnect between the company book value and market capitalization. Accounting differences between the USA’s GAAP and Europe’s IFRS play a significant role.
Rolls-Royce’s strategic choices in the early 2010s will have ramifications for engine development on future commercial aircraft programs.
By Judson Rollins
Nov. 25, 2019, © Leeham News: Nearly every manufacturer of jet engines is experiencing problems with various models, which is causing delays for several prominent Boeing and Airbus programs. The Airbus A220, A320neo, A330neo and Boeing 787, 777X are all experiencing engine-related setbacks.