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United Tech engine deliveries not changed by JetBlue deferral - CFO
April 26, 2017 / 2:40 PM / 6 months ago

United Tech engine deliveries not changed by JetBlue deferral - CFO

A JetBlue aircraft comes in to land at Long Beach Airport in Long Beach, California, U.S., January 24, 2017. REUTERS/Mike Blake

(Reuters) - United Technologies Corp (UTX.N) still plans to deliver 350 to 400 Pratt & Whitney Geared Turbofan engines to plane makers this year, and does not expect the total to be reduced by JetBlue’s decision to defer some Airbus aircraft with those engines, United Tech’s chief financial officer told Reuters on Wednesday.

JetBlue Airways Corp (JBLU.O) raised concerns on Tuesday when it said it will postpone delivery of 13 aircraft scheduled for 2019 and 2020 and take Airbus planes with an earlier engine design.

“All they have done is swapped some engines,” CFO Akhil Johri said in an interview.

Johri said that since European regulators have recently approved a solution, repairs can go ahead, and engines already sent to customers should be fixed by the middle to the end of May. The fix also was going into engines in production.

“It will take some time before all the drama dies,” he said. “But these are durability issues we know how to fix.”

A second problem with the engine combustor lining degrading sooner than expected will be fixed by year-end, and “all the new engines after that will have the longer durability on the combustor liner,” he said.

On a conference call with analysts, Chief Executive Officer Greg Hayes said the costs of the repairs were “not huge” and had been factored into earnings projections for the year. “It’s not material,” he said.

Hayes added, ”We haven’t seen any other surprises or concerns“ with the engines.”

United Tech, the maker of Otis elevators, Carrier air conditioners and aerospace parts, reported a 17.8 percent rise in profit on Wednesday, beating analysts expectations.

Reporting by Alwyn Scott in New York; Editing by Jeffrey Benkoe

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