Rolls-Royce Holdings announced on Tuesday that it will need to carry out inspections on its Trent XWB-84 engines after cracks were discovered on a small number of the engines that power the Airbus SE’s A350 plane.
Rolls-Royce (RYCEF) said that it did not expect this issue to create “significant customer disruption or material annual cost” given the limited additional work anticipated to address this wear together with the availability of replacement parts and spare engines.
The British jet engine manufacturer explained that during routine inspections it identified indications of wear in the intermediate pressure compressor (IPC) of a small number of engines that have been in service for 4 to 5 years and are scheduled for their first overhaul. Although none of these engines have experienced any in-flight disruptions, Rolls-Royce will inspect all other Trent XWB-84 engines of a similar service life as a precaution, the company added.
“The Trent XWB-84 has experienced the smoothest entry into service of any widebody engine we have developed. Engines now coming in for overhaul have travelled the equivalent of 350 times around the world, with no unplanned maintenance,” Rolls-Royce’s Chris Cholerton said. “It is reassuring to see that our proactive inspection regime has enabled us to identify and swiftly address this issue and minimise any potential impact on our customers.”
There are currently just over 100 Trent XWB-84s that have been in service for 4 to 5 years. Rolls-Royce said that the company has inspected the majority of them and found signs of wear on an average of 1 or 2 IPC blades in a small number of them.
“We have also taken the precaution of sampling a number of younger Trent XWB-84 engines and have found no unexpected wear,” Rolls-Royce said in a statement.
This is not the first time Rolls-Royce has been hit by engine troubles. Rolls-Royce’s Trent 1000 engine, which is used for the Boeing 787 plane has shown issues with turbine blades. Norwegian Air recently reported that its Trent 1000-powered 787 aircraft have suffered from long-running problems that have affected reliability and resulted in disrupted operations causing significant losses.
The almost complete halt in travel demand during the coronavirus pandemic have hit the airline industry hard sending Rolls-Royce shares down 61% this year. Meanwhile, the $4.75 average analyst price target indicates 36% upside potential to current levels.
Overall, Wall Street analysts are sidelined on the stock. The Hold consensus shows 4 Holds and 3 Sells versus 2 Buys. (See Rolls-Royce stock analysis on TipRanks)
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