Mike Cote’s Business Editor Notebook: Jet engine battleground includes NH


August 26. 2017 10:06PM

Chairman and CEO of General Electric Jeff Immelt, left, chats with Sen. Lindsey Graham, R-S.C., during a tour of the GE Aviation complex in Hooksett in November 2015. At left is a GE Aviation aircraft engine that is made in Hooksett. Immelt stepped down as CEO in July but remains chairman. (UNION LEADER FILE)

Can you hear the roar? New Hampshire plays a major role in the competition for dominance between two titans in the jet-engine business.

Bloomberg reports Pratt & Whitney’s new jet engine is losing ground to a model built by General Electric. Both players have major operations in the Granite State, where work on those engines is underway.

“The GE turbine has won 10 times as many orders this year to power a narrow-body Airbus plane on which the two suppliers compete head to head,” Bloomberg reported Tuesday, citing data provided by Flight Ascend Consultancy. “Pratt has signed just one buyer in that span to supply its geared turbofan engine for the aircraft.”

UPS operates a logistics center in Londonderry, shown here in 2016, that is a disribution hub for Pratt & Whitney’s jet engine and manufacturing sites around the world. (COURTESY/UNION LEADER FILE)

Don’t count Pratt & Whitney out just yet. The subsidiary of Farmington, Conn.-based United Technologies invested $10 billion over 20 years to develop the engine and to date has orders for 8,000 of them, the company says. Last year, Pratt & Whitney spent $25 million in New Hampshire alone on the supply chain for the geared turbofan engine, a spokesman told the Union Leader. In 2015, the company opened a logistics center operated by UPS near the Manchester-Boston Regional Airport.

“For perspective on the significance of our production ramp, in 2016, P&W’s supply chain spend for the GTF program was $770 million,” spokesman Matthew Bates said in an email. “Of that total, 78 percent ($600 million) was invested in the United States.”

While aviation industry insiders and stock market analysts will pore over the Bloomberg report, the big picture for New Hampshire is how these two publicly traded companies have invested here for a long game with big risks and big payoffs.

The logistics center in Londonderry, a sprawling complex anchored by a 600,000-square-foot building, serves as a distribution hub for Pratt & Whitney’s manufacturing sites and engine centers around the world in partnership with UPS. Touted to bring as many as 600 new jobs when it opened in 2015, the center made headlines early on for delays that held up the delivery of 55 jet engines, costing $500 million in sales, which the company attributed to startup challenges.

While Bloomberg noted other manufacturing hurdles since then – including technical glitches that forced some airlines to ground planes – Pratt & Whitney has ramped up production.

“Since mid-June, we have shipped on average approximately 1.5 GTF-family engines per day, and remain committed to producing 350-400 GTF family engines this year,” Chris Calio, president of Pratt & Whitney Commercial Engines, said in a statement provided to the Union Leader. “We are aggressively addressing our entry-into-service issues and are focused on minimizing the operational impact on our customers as we ramp production.”

GE Aviation employs 800 workers in Hooksett, where it produces components for the LEAP jet engine. (COURTESY)

Hooksett key to LEAP engine

GE Aviation, which employs 800 workers in Hooksett, produces components for the LEAP jet engine it developed with Safran for their joint venture, CFM International.

Rick Kennedy, a spokesman for GE Aviation, didn’t address the competition with Pratt & Whitney when contacted Tuesday about the Bloomberg report.

“It is an interesting story. But to be completely honest, GE and Safran have a different thought with all of this,” Kennedy said via email. “The goal for CFM International (GE and Safran) is to produce 500 LEAP engines this year, 1,300 next year, and 1,800 the year after that. This is an unprecedented jet engine ramp-up for GE and Safran in the airline industry. It is likely the largest engine ramp-up in all of airline history.” 

Executives at Pratt & Whitney likely would agree with Kennedy’s big-picture perspective on what projects of this scale mean. 

“All of the focus is on delivering engines on time, and managing costs, because there is always a learning curve in establishing the production line for new engines and their components. It is a huge undertaking,” Kennedy said.

“This is the proving point in the life of a new engine program. You spend more than $1 billion to develop the engine, you work like crazy to get it launched with important airline customers, and then the real test begins – ramping up the production across your entire network of factories involved.” 

GE’s New Hampshire plant plays a critical role.

“Hooksett is a huge part of this success,” Kennedy said. “The GE sites supporting LEAP have really pulled together to meet this extremely demanding engine ramp-up.” 

Contact Business Editor Mike Cote at 206-7724 or mcote@unionleader.com.



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