A320neo and A220 Fleets of the airline operators suffer GTF engine durability issues.

Key Points:

  • The recall of numerous Pratt & Whitney jet engines has prompted airlines worldwide to temporarily cut flights and routes for safety inspections.

  • RTX, the parent company of Pratt & Whitney, could face a multibillion-dollar cost due to the recall, challenging their profitability prospects.

  • Historical context: Pratt's introduction of the geared turbofan engine marked its re-entry into the single-aisle jetliner market, battling competitors like CFM.

EAST HARTFORD — Due to the recall of a substantial number of Pratt & Whitney jet engines, several global airlines, spanning from the U.S. to Europe and Asia, are temporarily curtailing some of their flight schedules. The aerospace and defense entity RTX, which oversees Pratt & Whitney, could potentially be slapped with a multibillion-dollar invoice.

Although initial estimates indicated around 200 engines requiring inspections, RTX clarified on Friday that 137 engines used in Airbus single-aisle planes will undergo checks in the forthcoming weeks. This situation has exacerbated the challenges for airlines already grappling with workforce shortages and air-traffic control congestion.

The engine recall has significant implications for RTX, a major player in the aerospace and defense sector. Its capability to swiftly rectify the issue will also influence Airbus's potential to upscale the production of its single-aisle aircraft. While Airbus confirms no disruptions to this year's production, the company remains vigilant about potential repercussions in the future.

Various airlines have taken measures in response to the engine issues. For instance, Spirit Airlines recently revealed its plan to withdraw seven Airbus A320neo aircraft from its fleet for evaluations in the upcoming autumn. With engine complications impacting over 40 of Spirit's 200 jets, the company forecasts potential limitations in introducing new flights next year. Similarly, Hawaiian Airlines intends to suspend certain routes and decrease its flight frequency during the engine inspection phase. Renowned carriers like Germany's Lufthansa, Mexico's Volaris, and JetBlue Airways from the U.S. are also contemplating flight reductions.

Recent revelations from Pratt highlighted the necessity for immediate engine inspections due to the identification of polluted metal components in 2021. Furthermore, it's estimated that around 1,200 engines might develop cracks sooner than anticipated. Customers were recently informed about the engines that require imminent inspections and those that can await checks over the coming year.

The necessity for massive engine recalls for the Airbus A320neo, resulting from minor quality issues, adds another layer of challenges to Pratt. Since introducing its innovative fuel-efficient GTF engine in 2016, the company has consistently been dogged by durability issues. These engines, despite reducing fuel consumption by 15% and boasting minimal emissions, have been mired in recall concerns.

Selling over 10,000 GTF engines, RTX confronts the possibility of compensating its customers for the rigorous inspections and subsequent repairs. Analysts speculate that RTX may only see profitability from this venture by 2030. The firm has provisionally allocated $500 million to manage the expenses linked to the inspections, fixes, and compensation related to the GTF engines currently under scrutiny.

The company, formerly recognized as Raytheon Technologies, is no stranger to compensations. Historical issues with GTF engines, such as oil leakages and vibrations, necessitated extra servicing, leading to compensations. RTX's Chief Executive, Greg Hayes, undertook customer engagement in July to discuss the widespread groundings of Pratt-powered Airbus jets due to persistent durability and spare parts issues. As Hayes articulated in a prior interview, customer dissatisfaction is palpable.

Reflecting on historical developments, Pratt's engines were once the driving force behind Boeing 737s. However, by the 1980s, the company ceded this space to competitors like General Electric and French partner Safran. Pratt's strategic introduction of the geared turbofan for commercial airlines marked its resurgence in the market, capitalizing on decades of technological refinement initially meant for propeller planes.

The GTF's significant break came with Airbus launching its revamped A320neo in 2010, offering configurations with Pratt's new engine. Airbus's acquisition and renaming of Bombardier's CSeries program to A220 further expanded the fleet of GTF-powered planes, boosting Airbus sales and prompting Boeing's development of the 737 MAX with engines from GE and Safran to counter the A320neo.

Pratt's GTF engines, despite being efficient, have faced durability problems, much like CFM's engines. Yet, CFM has been more adept at addressing these concerns, thereby capturing a more substantial market share.