RYCEY Rolls Royce Holdings PLC (PK)

By Robert Wall

LONDON--Emirates Airline president Tim Clark has expressed concern about engines made by Rolls-Royce Holdings PLC used to power the Airbus Group SE A380 super jumbo.

There are "technical issues" with the so-called Trent 900 engine, Mr. Clark told reporters Friday in Berlin, without specifying the nature of his concerns. Emirates is the biggest A380 customer and the largest international airline by traffic.

Emirates Airline last year signed a $9.2 billion deal with Rolls-Royce to power 50 A380s planes. The landmark deal was unusual because the Dubai-based carrier took the unusual step of switching engine suppliers. It previously bought A380 engines from a joint venture of General Electric Co. and Pratt & Whitney, the engine arm of United Technologies Corp.

Mr. Clark said the airline still hoped to receive the first of its Rolls-Royce-powered A380 double-decker planes on Dec. 2, according to reports confirmed by a spokesman. The airline executive said the engines should be delivered as specified.

Rolls-Royce said it was working with the carrier and Airbus to meet the planned entry into service of the planes in Emirates Airline's fleet.

A spokesman for Airbus Friday said: "We are working with our customers, supporting their delivery stream."

The issue with the A380 engine are the latest in a number of setback suffered by Rolls-Royce. Problems with another of its widebody engines this year forced ANA Holdings Inc.'s All Nippon Airways Co. to ground some of its Boeing Co. 787 Dreamliner long-range planes because a component didn't last as long as expected.

Rolls-Royce previously had problems with the Dreamliner engine meeting performance promises. Its A380 engine also required redesign after one of the powerplants exploded on a Qantas Airways Ltd. plane in 2010. The plane landed safely, though it sustained extensive damage.

Widebody engines are critical for Rolls-Royce, which has retreated from supplying engines for more commonly used narrowbody planes, such as the Airbus A320. Rolls-Royce sales of engines to power business jet aircraft are also under pressure, management has said.

Eric Schulz, president of Rolls-Royce's civil aerospace business, warned investors this week of market uncertainty. Order intake this year is lower than deliveries for the first time for many years, he said. Order cancellations were low and the company was insulated by a huge backlog of engines already ordered that still need to be built, he said.

Earnings at Rolls-Royce, which is no longer affiliated with the luxury car maker, have been under pressure also from low demand for its marine engines. Sales and profit are set to decline this year. Management said this week that new accounting standards would further depress reported profit beyond 2020.

Write to Robert Wall at robert.wall@wsj.com

(END) Dow Jones Newswires

November 18, 2016 07:56 ET (12:56 GMT)

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