Rolls Joins Forces With Pratt On Future GTF

Oct 12, 2011


By Guy Norris
In an unprecedented move designed to outflank General Electric and its CFM partner Snecma, Pratt and Whitney and Rolls-Royce have announced plans to form a new engine joint venture to power future mid-size aircraft based initially on the geared turbofan (GTF) configuration.

The shock about-turn for Rolls-Royce includes a major re-structuring of International Aero Engines (IAE) under which the U.K. engine maker will sell its equity and program shares for $1.5 billion.

In a joint statement, the two engine makers say the agreement covers the establishment of “a joint venture company, in which each will hold an equal share, to develop new engines for the next generation of aircraft that will replace the existing mid-size fleet.” The statement also makes it clear that the focus for the initial venture will be on “high-bypass ratio geared turbofan technology,” but it adds that the venture will also “collaborate on future studies for next generation propulsion systems, including advanced geared engines, open rotor technology and other advanced configurations.”

The announcement, which came without warning Wednesday, represents a massive shake-up for the commercial engine industry and comes after more than two-years of failed negotiations between Rolls and Pratt over developing the GTF as an outgrowth of the IAE family.

Pratt and Whitney says it meanwhile intends to discuss a possible offer of a portion of Rolls’ shares with IAE partners MTU and Japanese Aero Engines Corp. (JAEC). As part of the restructuring deal, Rolls-Royce will receive an agreed payment for each hour flown by the current installed fleet of V2500-powered aircraft for 15 years from completion of the transaction.

Rolls-Royce will remain “committed to IAE and its customers” adds the statement. Rolls will continue to be responsible for the manufacture of high-pressure compressors, fan blades and discs as well as the provision of engineering support and final assembly of 50% of V2500 engines.

The joint venture is subject to regulatory approval but “we are confident it will go through,” says a Rolls spokesman. Rolls underlines that although the new agreement with Pratt enables it to “modestly” financially support the on-going development of the geared turbofan family for the A320NEO, it will not be directly involved in the development program. The agreement does not extend to applications on the Bombardier CSeries, Mitsubishi MRJ or MC-21, although this latter engine will be virtually identical to the A320NEO engine. The focus of the joint venture will be on the next-generation of engines beyond these, with the GTF as the most likely starting point for the developments

The two companies are targeting the next-generation of 120-230 passenger aircraft that ultimately will succeed the A320, A321, A320NEO, Boeing 737 Next Generation family, 737MAX, MD-80/90 and 757. Between them, they estimate this will generate a worldwide demand for around 20,000 new aircraft (or nearly 45,000 engines) over the next 20 years.


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