Rolls-Royce Holdings (LON:RR) has suffered a setback as Japan’s largest airline, All Nippon Airways (ANA), found a problem with the group’s engines in its fleet of Boeing 787 Dreamliners. The news marks a blow for the blue-chip engine maker which has been trying to recover from a string of profit warnings.
Rolls-Royce’s share price stumbled in yesterday’s session, closing 1.84 percent lower at 774.00p, underperforming the benchmark FTSE 100 index which shed 18.88 points to end the session 0.28 percent in the red at 6,816.90. The group’s shares have gained more than five percent over the past year, and are up by more than a third in the year-to-date.
Reuters quoted Japan’s ANA Holdings as saying yesterday that it needed to replace damaged compressor blades in Rolls-Royce’s Trent 1000 engines powering its Boeing 787s, forcing it to cancel some Dreamliner flights over the coming weeks. The Japanese carrier explained that under certain flying conditions the compressor blades in the engine’s interior showed corrosion. The UK engine maker told the newswire that it was “working closely with ANA to minimise the effect on aircraft service disruption”.
Rolls-Royce did not say whether the problem had been found in 787 engines on aircraft operated by other airlines, but when asked about any requirement to take additional action a spokesman told Reuters that the issue was limited to a small proportion of the ANA fleet.
One aviation expert meanwhile told The Times that the technical issue with the Trent 1000 engines had been exacerbated by ANA’s operating of the 787s. While the Dreamliner was envisaged as a fuel-efficient mid-range and long-haul alternative to bulkier international aircraft, the Japanese carrier has been using it as a high-frequency domestic workhorse.
The newspaper further noted that the cost of having to fix ANA’s Trent 1000s was within a £64-million ‘negative effect’ cost that Rolls-Royce had flagged in its recent half-year results that it said was specific to the Trent 1000 and its Trent 700 engines for the Airbus A330 aircraft.