Honeywell, Pratt & Whitney To Design Army's Copter Engine

In a concerted effort to improve the performance of its helicopter engines at lower operating costs, the U.S. Army has offered a contract to the Advanced Turbine Engine Company (ATEC) to undergo a design review of its fleet of Black Hawk and Apache (NYSE:APA) helicopters. The two-year contract for an undisclosed amount is an integral part of the Army's Improved Turbine Engine program that encourages the development of affordable engines without compromising on quality.

The ATEC is a joint venture forged in 2006 between two industry stalwarts namely, Honeywell International Inc. (NYSE:HON) and Pratt & Whitney, a division of United Technologies Corporation (NYSE:UTX) . The joint venture aims to design state-of-the-art engines like HPW3000 that seek to either match or excel the aggressive performance goals of the U.S. Army. These include specifications such as 50% more powerful engines than the existing ones, 25% more fuel efficient, 20% longer engine life at high altitude and hot conditions at 6,000 feet and 95 degrees Fahrenheit.

The advanced 3,000 shaft horsepower turbine engine HPW3000 features dual-spool architecture that optimizes engine efficiency, reduces maintenance costs, extends engine life, and improves power growth capability. The engine is expected to offer potential annual savings of $1 billion, compared with the current engine in the Black Hawk and Apache fleets. It offers a perfect solution to the U.S. Army to replace its fuel-guzzling copters with a powerful yet affordable engine.

The development schedule for the engine program of the U.S. Army intends to select from competing preliminary engine designs in 2018 and then proceed with a single engine developer.

Pratt & Whitney is among the world’s leading suppliers of aircraft engines to the commercial, military, business jet and general aviation markets. Pratt & Whitney’s Global Services provide maintenance, repair and overhaul services, including the sale of spare parts and fleet management services for large commercial engines.

Honeywell is a global diversified technology and manufacturing company with a wide range of aerospace products and services, control, sensing and security technologies for buildings, homes and industry. The company also manufactures turbochargers, automotive products, specialty chemicals, electronic and advanced materials, process technology for refining and petrochemicals, and energy-efficient products and solutions for homes, business and transportation.

Both Honeywell and United Technologies carry a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the industry include Barloworld Ltd. (OTC:BRRAY) and Crane Co. (NYSE:CR) , both carrying a Zacks Rank #2 (Buy).