Robert Wall
LONDON--The departing chief executive officer of Rolls-Royce
Holdings PLC Friday said United Technologies Corp. is an "obvious"
potential partner for the British engine maker as it eyes a
re-entry into the huge market to power single-aisle jetliners.
Rolls-Royce was teamed with Pratt & Whitney, the engine arm
of United Technologies, on making engines for Airbus A320 jets
before exiting that partnership in 2011.
"We know we can work well together and I think we could work
well together in the future. It is certainly a possibility," John
Rishton told reporters after the company's annual shareholder
meeting.
Narrowbody jetliners such as the Boeing 737 and Airbus A320
represent the bulk of commercial flying and around 75% of all
airliner engines by volume. The size of the market is driving
Rolls-Royce's interest to re-enter because of differences with its
partners over engine development trends at the time and business
priorities.
Mr. Rishton said the company has the technical skills to develop
a new narrowbody engine on its own, but that market dynamics make
teaming up with another company prudent. "The issue that I am
troubled by is the incumbency strength particularly of GE," he
said.
General Electric, in partnership with France's Safran SA,
exclusively powers Boeing 737s and has about 50% of the market for
Airbus A320 jets.
How to structure a future engine partnership will likely be
determined by Warren East, who replaces the retiring Mr. Rishton in
July. A decision is not urgent, Mr. Rishton said, with a new plane
to use such an engine not on the horizon until around 2030.
Write to Robert Wall at robert.wall@wsj.com