(Reuters) - Airlines and aerospace suppliers are expected to take a hit after RTX Corp said on Monday 600-700 engines on Airbus A320neo jets need to be inspected for quality issues, which could ground hundreds of aircraft through 2026.
In July, RTX said microscopic contaminants were found in a powdered metal used in high-pressure turbine discs that are part of the Pratt & Whitney Geared Turbofan (GTF) engine's core. The presence of those contaminants could lead to cracks in the engine.
The following airlines and aerospace suppliers expect to be affected:
Air New Zealand The company said the issue would further
reduce engine availability and have a
"significant" impact on its flight
schedule from January 2024. The airline
has 16 A320neo jets in its fleet.
Singapore The inspections would affect four of the
Airlines' Scoot engines that power Scoot's A320neo fleet
and could force it to adjust some of its
flights.
Wizz Air The Hungarian carrier estimated a
potential 10% capacity reduction in the
second half of fiscal 2024.
IHI Corp The Japanese firm expects an earnings
hit from the lengthy inspections.
Kawasaki Heavy The component manufacturer expects an
Industries impact on its earnings from the jet
inspections.
Melrose The GKN (LON:GKN) Aerospace owner said it faces a
Industries potential hit of around 200 million
pounds ($249.54 million) over the period
to 2026.
MTU Aero MTU, which has an 18% share in the GTF
Engines engines program, said inspections could
result in a hit to revenue and reported
EBIT of around 1 billion euros ($1.07
billion) in 2023.
($1 = 0.8015 pounds)
($1 = 0.9317 euros)