Roll Out New Partnership To Develop Next Generation Engines For
Mid-Size Aircraft
Two of the major players in the powerplant industry have
announced a restructuring of their participation in IAE
International Aero Engines AG (IAE), which produces the V2500
engine for the A320 family of aircraft. Under the terms of the
agreement, Rolls-Royce will sell its equity and program shares in
IAE to Pratt & Whitney for $1.5 billion. Pratt & Whitney
intends to discuss a possible offer of a portion of these shares
with its IAE partners MTU Aero Engines AG (MTU) and Japanese Aero
Engines Corporation (JAEC). In addition, Rolls-Royce shall receive
an agreed payment for each hour flown by the current installed
fleet of V2500-powered aircraft for fifteen years from completion
of the transaction.
V2500 Engine
Rolls-Royce ways it remains committed to IAE and its customers
and will continue to be responsible for the manufacture of
high-pressure compressors, fan blades and discs as well as the
provision of engineering support and final assembly of 50 percent
of V2500 engines. Since its creation almost thirty years ago IAE
has become a major force in international aviation with
approximately 4,500 V2500 engines in service and approximately
2,000 on order.
At the same time, the two companies announced an agreement to
form a new partnership to power future mid-size aircraft (120
– 230 passenger aircraft). The two companies will establish a
joint venture company, in which each will hold an equal share, to
develop new engines for the next generation of aircraft that will
replace the existing mid-size fleet. The new venture will draw on
the most-advanced technology from two world-class companies to
drive enhanced performance for this fast-growing segment in which
worldwide demand for around 20,000 new aircraft (or nearly 45,000
engines) is predicted over the next 20 years.
This new joint venture will focus on high-bypass ratio geared
turbofan technology. In addition, the venture will collaborate on
future studies for next generation propulsion systems, including
advanced geared engines, open rotor technology and other advanced
configurations.
The new collaboration brings together complementary
technological resources and is designed to offer the best, most
competitive response to customer demand for the next generation
powerplant in the mid-size segment. The collaboration could bring
about significant value for customers, as both parties are able to
benefit from each other's strengths.
The new joint venture between Pratt & Whitney and
Rolls-Royce also benefits from the success of the V2500 and the
PurePower engine in establishing a broad customer base. It builds
on the long-standing and successful partnership between Pratt &
Whitney and Rolls-Royce in the mid-size segment. JAEC and MTU,
partners of IAE and the PurePower PW1100G-JM (Geared Turbofan)
engine program for the Airbus A320 New Engine Option (neo), also
intend to join the new collaboration.
"Today's announcement charts a clear course for the future of
Rolls-Royce in the important mid-size aircraft segment," said Mark
King, president, Civil Aerospace, Rolls-Royce. "We are building on
many years of successful collaboration with Pratt & Whitney in
this segment to develop advanced aero engines, which we are
confident will set new standards in aviation technology,
performance and fuel efficiency."
"These agreements position Pratt & Whitney, JAEC, MTU and
IAE to best serve the needs of their customers for all A320
aircraft family," said Todd Kallman, president, Commercial Engines
& Global Services, Pratt & Whitney. "We are delighted to
collaborate with Rolls-Royce with its complementary capabilities as
we look forward to the next generation of aircraft engines that
will offer even greater operational and environmental
benefits."
In addition, Rolls-Royce will make a modest financial investment
in the PurePower PW1100G-JM (Geared Turbofan) engine for the Airbus
A320 New Engine Option (neo) program.
The transactions are subject to various closing conditions,
including regulatory approvals.
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