Pratt & Whitney head says jet engine output risks easing | Reuters

Pratt & Whitney head says jet engine output risks easing
| Reuters

SINGAPORE Pratt & Whitney's new chief says the performance of suppliers is much better than year ago, easing concerns over its ability to execute a $10 billion gamble on a new engine as it seeks to reclaim a once revered status in the jet industry.

But the industry veteran said he knew how to find out whether the company's make-or-break production goals for the latest short-haul airplane engine are under strain.

"I will get every engine serial number and will see the parts that are committed and if it supports the engine shipment date," Robert Leduc told Reuters at the Singapore Airshow.

Speaking after opening a high-tech fan-blade plant in Singapore, Leduc also played down concerns over aircraft demand, saying the company had seen no deferrals or cancellations.

Once dominant in commercial aviation, Pratt lost its way in the 1990s after betting on the wrong category of plane and leaving the door open to General Electric (GE.N) and its French partner Safran (SAF.PA), who now lead sales by volume.

It is seeking to regain its position with a fuel efficient engine for jets including the Airbus (AIR.PA) A320neo as well as Canada's Bombardier (BBDb.TO) and the latest model of Embraer.

Developed at a cost of $10 billion, the Geared Turbofan engines claim to burn 15 percent less fuel and have already influenced the way some future jet engines are designed.

Pratt has sold 7,000 of them and triggered other engine and plane developments. But analysts warn the company still has much to prove as it attempts to increase production seven-fold in the next four years.

When the previous president stepped down earlier than expected last month after steering through development, the boss of parent United Technologies (UTX.N) named retired operations expert Leduc to take on the crucial early production phase.

It was the second time the no-nonsense 59-year-old had been pulled out of retirement.

Returning to Pratt & Whitney's Connecticut offices on Jan. 14, Leduc paid tribute to the advanced design, but told senior staff: "Now we've got to execute and deliver to our customers. Our reputation depends on it," according to a person present.

It plans to make 200 Geared Turbofans this year, roughly doubling in 2017. That number will grow close to 1,400 by 2020.

GE-Safran venture CFM International also has aggressive output plans, but benefits from an existing supply chain.


Both engine makers are at the forefront of a record output drive that has triggered concerns over the ability of weaker suppliers to keep up.

Any slip-ups could affect profit across the sector and Pratt must additionally demonstrate it can execute on an all-new civil project for the first time in years.

"I have spent an inordinate amount of time on this in the last four weeks; it was probably my number one priority, digging into the industrial schedule," Leduc said.

With $22 billion of long-term supply agreements, or 85 percent of its needs now in place, confidence in suppliers has risen in the past year, Leduc said. That allows Pratt to focus most effort on the engines where needed.

"We weren't managing that way last year," Leduc said.

"I think every engine was a fist fight; we didn't have the fidelity around the (supplier) commitments. Now the design is stable; once (that happens) you give your operations a fighting chance to deliver."

Even so, some glitches need to be resolved.

The Airbus A320neo missed an end-2015 target for first delivery after it emerged the engines needed longer than usual to start properly, adding precious minutes to turnaround times.

A part was redesigned and will be followed by a software fix in 3-4 weeks. But the problem is an example of the slim margin for error in the cut-throat short-haul airline market.

Most modern jet engines need 150-180 seconds to start up. Pratt's new engines currently need closer to 350 seconds. By June the goal is to get this to 200 seconds, and by end-year back to normal, a person familiar with the repair plan said.

The engines have also faced a problem with sophisticated control software sending erroneous messages to the cockpit, adding extra workload before the plane can take off.

Engineers aim to eliminate 65 percent of the rogue messages by April and the rest by June. They are not related to aircraft systems and don't present any safety risk, Leduc said.

He said there had been no schedule delays since he took the job last month. Industry sources have cited previous delays and say Airbus is renegotiating some deliveries. Both firms say output will be skewed towards the second half.

"I have got a fair amount of confidence in what is going to happen. I think we have got enough fidelity around our plants now and our investment and our supplier commitments that we are confident that we are going to make this ramp-up," Leduc said.

(Reporting by Tim Hepher; Editing by Mike Collett-White)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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Updated Date: Feb 16, 2016 06:30:12 IST

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