A Pratt & Whitney PW1000G turbofan engine sits on the wing of an Airbus A320neo aircraft during a handover ceremony outside the Airbus Group SE factory in Hamburg, Germany, Friday, February 12, 2016.
Mayor Bloomberg | Krisztian Bocsi
Actions of RTX it fell 13% on Tuesday after the aerospace giant said a manufacturing problem with some of its popular engines will require “expedited” inspections on some 200 aircraft engines.
The problem stems from powdered metal used to make some engine parts, RTX, the parent company of aircraft engine maker Pratt & Whitney, said during a quarterly earnings call. Engines currently in production are not affected, the company said.
RTX, formerly known as Raytheon Technologies, cut its cash flow forecast for the year by $500 million to $4.3 billion because of the issue.
“It’s going to be expensive,” RTX CEO Greg Hayes said during the company’s earnings call. “We are going to make the airlines whole as a result of the disruption that we are going to cause them.”
The issue is the latest challenge for airlines other than manufacturers’ latest planes, as carriers look to reap the rewards of a travel boom with a limited number of planes available.
Pratt & Whitney said it also expects around 1,000 more engines will have to be withdrawn from airline fleets in the next nine to 12 months. However, the company said it will continue to deliver new aircraft and parts.
The issue will affect some A320neos, a narrow-body jet and one of the world’s most popular jets. Compete with him Boeing 737 max
The Federal Aviation Administration said it is aware of the problem and is in contact with Pratt & Whitney as well as the airlines affected by the problem.
“The agency will ensure that appropriate action is taken,” the FAA said.
delta airlines, a major Airbus customer, said it is investigating the issue. Airbus did not immediately comment. TO JetBlue Airlines The spokeswoman said the carrier is “working with Pratt to assess the impact on our fleet.”
Meanwhile, the shares of General Energya rival engine maker, rose more than 6% on Tuesday after the conglomerate raised its forecast for revenue and cash flow for the year, in part due to strong demand for jet engines.
