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Rolls’ competitors may get a big boost

Bob Moon Nov 10, 2010
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Rolls’ competitors may get a big boost

Bob Moon Nov 10, 2010
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Kai Ryssdal: There was more bad news today for one of the companies that makes engines for the world’s biggest passenger plane — that would be the Airbus A-380. Singapore Airlines pulled three of its A-380s out of service after it found oil stains in the jetliners’ Rolls-Royce engines. Qantas, as you might remember, has grounded all six of its A-380s after an engine blowout and other oil leaks last week.

Much as there are just two big commercial plane makers — Boeing and Airbus — there are just three main commercial jet engine makers. Our senior business correspondent Bob Moon explores whether problems for Rolls-Royce could be a boon for its American competitors.


Bob Moon: The trouble with Rolls-Royce engines may not show up in the official sales pitches of its top American rivals, General Electric and Pratt & Whitney. But aviation industry consultant Michael Boyd says those companies will likely find a way to exploit Rolls’ misfortunes as a reliability issue.

Michael Boyd: Unofficially, in a back room over a cocktail, it’ll certainly come up by the competition — don’t kid yourself.

This is just the latest in a series of problems involving jet engines made by Rolls-Royce, which is a separate business from the BMW-owned carmaker. It’s also had an engine blow up on a ground test for Boeing’s 787 Dreamliner, which is still in development. And since GE also makes jets for that plane, its sales could see a boost.

Industry consultant Scott Hamilton says airlines buying the 787 have a choice between Rolls or GE.

Scott Hamilton: The sales to date are fairly evenly split between the two companies, but at least half of the customers have not selected the engine.

On the other hand, the Rolls-Royce engine problems could merely end up being a minor bump on take-off. Hamilton says the rush to develop a new generation of fuel-efficient jetliners has pushed technology to its edges.

Hamilton: Nobody can seem to put together a new program efficiently like they could in the good old days. You never saw this kind of stuff coming up.

At Jetstream Aviation Capital, industry analyst Stuart Klaskin says he’s not surprised when problems like this do come up.

Stuart Klaskin: You have to take a step back and say, “Look what they’re doing. This is literally rocket science.”

In Los Angeles, I’m Bob Moon for Marketplace.

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