At 62, I'm not sure I could be accused of being a fanboy but my affection for RR is a matter of record. Still, even I will sort of believe this only when I see it.

"We are currently undertaking our biggest ever increase in large engine production, targeting over 600 wide-body engines a year by the end of this decade. As a result of our innovation and investment, we are poised to become the world-leader in large aircraft engines, powering over half of the world’s passenger wide-body fleet within the next few years, compared to 22% just 10 years ago."

https://www.rolls-royce.com/media.aspx

I've been reading for a while predictions that RR will capture 50%+ of the widebody market sooner or later. Much as I'd like to see it happen, it just doesn't seem probable.

That said, this year (2018) RR are well ahead of GE in terms of widebody deliveries.

RR lean very heavily on the A350. But to achieve their ambition, sales of the A330neo will need to pick up and the A380 needs to soldier on for a while. RR also need to maintain or even increase their share (~40%) of the 787. None of this is a given.

GE have the lion's share of the 787 and are still building engines for the 747 and 767. But their future must hinge on the 777 and that's not a given either.

Interesting times.

(Pratt who...?)

Today RR announced plans to cut 4500 Jobs.

Flyglobal

I don't know much about RR's ambitions, but I suppose BA's and VS's are to have their new 787s back in flight someday...

Flyglobal wrote:

Today RR announced plans to cut 4500 Jobs.

Indeed. It was part of the same announcement about the strategic plan.

FatCat wrote:

I don't know much about RR's ambitions, but I suppose BA's and VS's are to have their new 787s back in flight someday...

Quite. And ANZ and all the others. It is an ambition I am quite sure RR share!

Why not? PW are out of the widebody game so it's just RR and General Evil.

As RR has exclusivity on the A330NEO and A350, that helps counter GE on the 777 and their lead on the 787. RR must be getting towards that 50% share.

As for job cuts, that 4500 is part of Warren East's plan to cut the fat. The vast bulk of the cuts are management and back office. As RR has expanded and moved a lot of functions to places like Singapore and Germany then there will be duplication. They have guaranteed the jobs of Derby engineers for five years at least.

Plus there will be a huge opportunity with B's new MoM.
Which engine will fit her most?
CFM, GE and PW won't stay at the window...

I wonder of breaking up IAE can be seen as a stroke of brilliance, looking back. Together RR & PW they could easily beat GE at technology, support and scale for new programs.

Thing is, GE9X are lowish numbers per year, 100? Airlines in general aren't enthousiatic about having no choice, so they make sure they have a competitive maintenance contract before they sign the dotted line.

GE decided to go for the 777 and opted out of the A350 and A330NEO. If that was a good idea, time will tell. GE90 production rate is now below 8 engines / month. Maybe they became too self confident over time, 77W being so succesfull, McNerney being at the helm etc.

Since the 797 is scheduled to be a twin aisle and therefore a wide body,RR getting to 50% will depend heavily if this aircaft is launched or not -and if it is who will power it.
Many feel that it is a 'tight' market gap.If true then it's not impossible that Boeing will go for an exclusive,even though they have talked about speaking to all 3/4 OEM's.If that was to be the case it would be GE in a CFM guise.Mind you their (Boeing) latest utterance on the subject hinted at any announcement being put back to 2019.
At least that will give time for all 3 OEM's to get their respective houses in order.But in this thread specifically RR and their coating issues.

PM - I prefer the term "home team". We obviously feel loyalty to a company providing so many jobs in our home territory. But that does not mean we do not feel free to criticize or see things as they are.

keesje wrote:

I wonder of breaking up IAE can be seen as a stroke of brilliance, looking back.

Yeah, I am sure RR is thrilled they are shut out of the narrowbody market for the foreseeable future.

How things change. In 1984 (which is only 34 years ago) GE thought they had effectively bought RR out of the big fan market.

https://www.nytimes.com/1984/02/04/busi ... ement.html

They were not impressed just a few years later when RR launched the Trent 700.

What is stopping RR developing a new engine for the A320/737/CS300/500 ? Are they out for good now?

Just bolt a big fan on the front of an EJ200

RR shares up nearly 20% since announcing 4,500 redundancies.Can someone please explain?

Beaten in the 787 engine competition and 2main packages need to be replaced
Exclusive on the non selling A330neo
Can't even get (we don't know) the last engine order for the failed A380
Exclusive on the non selling A350-10
Out of the massively growing narrow body engine market.

I must be missing something somewhere!

parapente wrote:

RR shares up nearly 20% since announcing 4,500 redundancies.Can someone please explain?

Beaten in the 787 engine competition and 2main packages need to be replaced
Exclusive on the non selling A330neo
Can't even get (we don't know) the last engine order for the failed A380
Exclusive on the non selling A350-10
Out of the massively growing narrow body engine market.

I must be missing something somewhere!

Re the share price. The redundancies are in management layers and administrative functions. They are not in the engineering/production space. So if implemented correctly they build as many engines as now but with fewer overheads - so higher profits + higher share price.

cledaybuck wrote:

keesje wrote:

I wonder of breaking up IAE can be seen as a stroke of brilliance, looking back.

Yeah, I am sure RR is thrilled they are shut out of the narrowbody market for the foreseeable future.

This was Pratt and Whitney's decision. They did not want to share the geared fan on the basis of IAE, so Rolls Royce sold their share to PW whilst it still had some value.

Rolls Royce is not a company of the size of UTC or GE. It would have found a narrowbody engine a lot to deal with alongside its popular big fan offerings and the smaller bizjet/airliner BR700 family.

Besides which, it was quietly working on the Pearl. It will be interesting to see how that engine scales, as it is apparently exceeding all its fuel burn targets.

RR's latest profit numbers https://www.ft.com/content/3ec16df8-21e ... f715791301

The AGM is today (15th June 2018) and updated numbers should also be healthy, even after the Trent 1000 costs are deducted. So being out of the narrowbody market isn't killing them, and they could well be back with a strong suite of engines next time round (the Advance 2 and Ultrafan for smaller jets).

I think the Trent-1000 debacle couldn`t have come at a worse time for RR. Prior to these troubles they`d been
in poor shape, but their saving-grace was the Trent-XWB, exclusivity on the great selling A350, & with a
couldn`t-be-better EIS it should have put them on the road to recovery along with T-1000-TEN & other
developments. Will this cost to the company in the final analysis jeopardise the existence of RR? If not
so drastic, could it curtail R&D so important to a company like RR? Whatever the outcome, I feel only
sadness at the situation they find themselves. They are at least working hard to mitigate the effects to
their customers, & to Boeing, & without a doubt they will have learn`t a lot in making sure nothing similar
repeats itself.

Congrats to RR for their achievements but it does seem to be a carefully chosen metric.

Clearly the A350 market is their bread and butter market and it will be putting bread and butter on the table for quite a long and healthy run.

However as mentioned A350J is not moving off the shelves briskly and it will be pressured by GE's need to sell 777Xs, and A358 has been abandoned so the program is somewhat constrained.

A330neo was not a huge investment and should at least be a break even project if not the runaway success the A330ceo was, but it too feels pressure from GE getting great economy of scale shifting GEnXs on 787s. We hear murmurs that the HA loss was at least partially due to GE's willingness to push GEnX aggressively.

Maybe the best decisions are the ones you don't make and RR saved itself a lot of pain for little gain had they gone forward with the A380neo as was the hot topic here on a.net circa 2014-6? It'd probably have had to follow the A330neo so RR would right now be under pressure to invest time and money in A380neo just as the 787 issue has been draining the company of time and cash.

Warren East has said the company is too heavy in middle management and above. Hopefully the right people get kept.

Cheers to RR for on-going investment in Advance and UltraFan and their eventual placement on commercial programs.

However when you go beyond the metric of half the widebody market, I think GE's quite content. Half of CFM so strong sales across A320 and 737. Strong share of 787 market. Still shifting a few CF6 for 767F. Shifting a few GeNX-1B for 747-8F at a similar rate as RR does for A380. Steady but diminishing market for GE90 on 777 and future GE9X on 777X. Selling off other divisions and keeping aviation. They should be all right. They have more than enough critical mass to compete for future projects such as NMA and NSA.

PW to me is the target at risk. The main thing keeping them going is the military market. They've fended off GE's efforts to find their way on to F-22 and F-35 so they have a gold mine all to themselves. The GTF has been borderline disastrous but time heals all wounds and I'm sure they hope two years from now it's a cash cow but the aviation industry has a long memory and it's hard to see how anyone makes the mistake of letting them be the launch engine in the next decade or two.

And -- I've ignored the bizjet market because I don't have a good grasp of what is going on there.

So it seems the next big battle ground is Boeing's NMA/797. It'll be very interesting if RR can beat out CFM who IMHO clearly have the inside track. If they could they'd then have the inside track on the 737 replacement too. But GE/CFM will fight to the death for it, I'd think, for the same reasons. On the other hand, RR was the launch engine for 787 so they have a puncher's chance. I'd be shocked and amazed if PW found itself on NMA especially as launch engine. I'm sure the customers want two vendors on the project yet Boeing probably only wants one so it'll be interesting to see where that ends up.

parapente wrote:

RR shares up nearly 20% since announcing 4,500 redundancies.Can someone please explain?

Beaten in the 787 engine competition and 2main packages need to be replaced
Exclusive on the non selling A330neo
Can't even get (we don't know) the last engine order for the failed A380
Exclusive on the non selling A350-10
Out of the massively growing narrow body engine market.

I must be missing something somewhere!

I think that's a bit gloomy.

"Beaten" on the 787? They have 40% of a huge project. I'm sure they'd prefer 60% or 80% but they've already delivered getting on for 600 Trent 1000s with hundreds more to come. To put it in context, they've already delivered far more engines for the 787 than they did for the 777. There's "beaten" and there's coming second.

Non-selling A330neo and A350-1000? A bit premature in both cases, I'd suggest, and it's not as if either engine cost them a fortune.

May we at least agree that they'll be raking it in on the A350-900 for years to come?

Out of the narrow body market for now but let's wait and see. And, for what it's worth, RR will continue to make money on the V2500 till at least 2026.

And, again, FWIW, by the end of April this year RR had delivered 126 widebody engines to GE's 88. That gives RR a 58% share. They're doing something right.

[twoid][/twoid]

parapente wrote:

RR shares up nearly 20% since announcing 4,500 redundancies.Can someone please explain?

Beaten in the 787 engine competition and 2main packages need to be replaced
Exclusive on the non selling A330neo
Can't even get (we don't know) the last engine order for the failed A380
Exclusive on the non selling A350-10
Out of the massively growing narrow body engine market.

I must be missing something somewhere!

You must be missing something, your A380 statement doesn’t make sense. Can’t get but you don’t know!!
Even if they don’t, they have supplied engines to 10 of the 14 operators with 154 aircraft to EAs 130. Clearly more successful.
Let’s see about the 330neo there’s plenty in the pipeline especially when the Freighter gets going. It’s better to have exclusivity on something than nothing at all.

keesje wrote:

GE decided to go for the 777 and opted out of the A350 and A330NEO. If that was a good idea, time will tell.

Some how I seem to recall GE being on the A350 and Airbus then demanding that they must provide and engine for all version or none at all, maybe it is a European thing where that change is labelled an Opt Out....

par13del wrote:

keesje wrote:

GE decided to go for the 777 and opted out of the A350 and A330NEO. If that was a good idea, time will tell.

Some how I seem to recall GE being on the A350 and Airbus then demanding that they must provide and engine for all version or none at all, maybe it is a European thing where that change is labelled an Opt Out....

GE were never “on” the A350 or 330neo, it never got that far. RR dominates the A330 so it was never going to be GE and they opted out of the 350 because they didn’t want to compete with the 777 because of the deal they have with Boeing.

RB211trent wrote:

par13del wrote:

keesje wrote:

GE decided to go for the 777 and opted out of the A350 and A330NEO. If that was a good idea, time will tell.

Some how I seem to recall GE being on the A350 and Airbus then demanding that they must provide and engine for all version or none at all, maybe it is a European thing where that change is labelled an Opt Out....

GE were never “on” the A350 or 330neo, it never got that far. RR dominates the A330 so it was never going to be GE and they opted out of the 350 because they didn’t want to compete with the 777 because of the deal they have with Boeing.

GE was powering the original preXWB A350 mk1 with bleedair versions of the GEnx. When Airbus turned it into the XWB GE was interested in powering the A358/A359 but not the A35J with modified GEnxs. Airbus, as Par13del stated, only wanted GE onboard if they powered all three and developed a new engine. GE refused so they were not on the XWB.

RR later got exclusivity rights on the -1000 when Airbus upped the plane’s performance and required a more powerful engine than previously agreed too. That gives them de facto exclusivity on the -900 because nobody is going to go through the trouble of developing an engine that can only power one variant of the family.

What a tragedy that the company clebrates its success while laying off 4,500 people and adding jobs in other countries. All the while, and somehwhat predictably, touting their "inclusion" and environmental awareness.

SteelChair wrote:

What a tragedy that the company clebrates its success while laying off 4,500 people and adding jobs in other countries. All the while, and somehwhat predictably, touting their "inclusion" and environmental awareness.

And that's just the beginning.

With all the money being poured into Seletar Singapore, it's only a matter of time before there are manufacturing job losses in the UK once support is withdrawn for legacy engines.

Not sure if it's occurred yet but RR Barnoldswick isn't far from shutting down RB211 fan blade production. I was told it would happen at some point this year.

parapente wrote:

RR shares up nearly 20% since announcing 4,500 redundancies.Can someone please explain?

The stock market is full of idiots who don't really understand what they are buying and selling.

Don't place any credence on what others do in the stock market to what will happen in the real world.



They think cutting out a layer of (supposed) fat will make all right with the (RR) world. It remains to be seen whether removing that layer makes them more or less efficient. One thing is for sure - they do need more engineering leads... many more engineering leads.

In the last 3 years, there has been a sea change for engine OEM's.

PBTH was a licence to print money, so the natural extension for all engine OEM's was ownership too, and extending to NB engines.

But that model only works if you design, test and build near faultless engines (within historical tolerances) from delivery to retirement.

Net result, is owners, operators, A & B and financiers, are taking a much harder look at engine contracts - performance, guarantees, compensation and insurance, and in turn, the engine OEM's are looking harder at sub-contractors - performance, guarantees, compensation and insurance. Even more so if the engine is exclusive.

New aircraft orders are under a level of scrutiny never seen before. Both A & B have updated their generic customer contracts in respect to engine supply (where they bundle with the air frame), and larger customers who purchase engines direct have/are doing the same (not just price delaying the EK A380 engine order?).

Instead of the focus largely being lifetime cost (price), and less on performance, now performance and especially compensation are elevated, and raised even higher where exclusive engine / air frame deals exist.

Do the current engine makers have the financial resources to write such guarantees?

Consolidation is overdue in the engine industry. None of the big three are as strong as historically. But do mergers in such cases add strength, or the reverse?

As the UN is finding with CORSIA, anti-competitive legislation is an impediment to global goals. What price the greater good? Polish those crystal balls - change is in the air, at Derby, Evendale & East Hartford.