GE Agrees on Deal to Build More Airbus Engines to Help Offset MAX Shutdown
December 20 2019 - 12:10PM
Dow Jones News
By Benjamin Katz
CFM International, a joint venture between General Electric Co.
and France's Safran SA, has struck a deal to increase production of
engines for Airbus SE's rival to the 737 MAX, helping CFM deal with
Boeing Co.'s production halt of its embattled plane, according to
people familiar with the matter.
The agreement will increase the volume of the LEAP 1A engines,
one of two turbine options for the Airbus aircraft, to around 58%
of total A320neo deliveries, with Pratt & Whitney, a unit of
United Technologies Corp. due to slow output to about 42%, the
people said. The previous arrangement was for a 50-50 split.
The timing of the deal is crucial for GE as it works out how it
will manage the factory slowdown caused by the grounding of the MAX
and Boeing's decision this month to halt production.
"We have regular discussions" with plane builders "about
potential rate increases," a spokesman for CFM said in a
statement.
Write to Benjamin Katz at ben.katz@wsj.com
(END) Dow Jones Newswires
December 20, 2019 11:55 ET (16:55 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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