T.He vaguely The vapor trail in the clear sky is a clear indication that commercial aviation has been severely affected by the Covid-19. For the makers of jet engines that make those momentary streaks – fewer planes sold, fewer flying hours and older aircraft retiring as early as a fleet is a threefold blow to an industry that has largely made a profit by keeping it in the air for years. Then they are sold.
The immediate effect for the business, which is supported by a handful of manufacturers, was on full display on March 11th. Rolls Royce, a British company that competes with General Electric’s aviation division of the United States.GE) To power long-range giant body jets, publishing dire results for 2020. The blow to commercial aerospace, the source of half of its revenue in 2019, led to an operating loss of b 2bn (2.8bn). It sold only 264 large engines, down from 510 a year ago.
Rolls Royce is expected to recover very slowly, as it only makes the engine for the very difficult long-term market. But Pratt & Whitney, an aerospace and defense group, a division of Raytheon, which works with a joint venture GE And the trip to France made engines for short-haul planes, even in 2020 the revenue has declined in 2020. GE Aviation sales fell third to bn 22bn, creating 13,000 jobs, a quarter of the total.
The effects of the recession will last for years. Engine manufacturers work more like service companies than traditional manufacturers. They sell the engine at a price (or even a loss) to create an “installed base”. For GE, The sharpest of the three, the proportion is 37,700 units. With an engine life of 20 years or more, supplying spare parts and maintenance increases the sale price three to five times, says a broker named Bernstein. Production cuts by Airbus and Boeing, which make the planes themselves, mean less demand for engines. Things are getting worse as airlines reduce capacity. With early retirements and around one-third of the fleet at the store, carriers can replace planes or replace entire engines for expensive spare parts due to the costly overall for those with less miles of watches.
Merger between GECAS, A large aircraft lease unit, and Ireland’s March 10 announcement could also disrupt engine manufacturers. In recent years Airbus and Boeing have opted to offer only one type of engine for new aircraft rather than a choice, which reduces their development costs. But it threatens to go with a competitor, leaving low-cost airlines to discount discounts from engine manufacturers. GECAS, Fleet of over 1000 aircraft, gave GE To insist on more power that the two larger planes chose sole sourcing. Its strategy may change under new ownership.
Uncertainty about the next pay generation of the aircraft is another headache. Last year Airbus said that by 2035 it aims for a pure-zero-emission aircraft, possibly using hydrogen as a hydro fuel. Boeing is investigating biofuels. No company has a firm plan yet. But such announcements concern Rolls-Royce, which has spent m 500m on a more efficient engine, but a more efficient engine using existing technology, the Ultrafan. If planemakers are serious about going green, they may struggle to find customers. ■
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This article appeared in the business section of the print edition under the heading “Lost Thrust”