ILA Berlin Air Show 2012

Special coverage from onsite at the 2012 ILA Berlin Air Show
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  • MTU – Déjà vu?
    Posted by John Morris 2:13 AM on Sep 12, 2012

    Memories may fade, but facts don’t.

    MTU, Germany’s engine giant and the world’s fifth largest engine manufacturer, has long pursued a strategy of well-defined partnerships – with Pratt & Whitney on commercial engines, Rolls-Royce on military, and as a supplier to GE for various parts of engines such as the GE90 and GEnx.

    But it has made it clear that the risk sharing in the commercial arena is with Pratt & Whitney, especially on the geared turbofan that will power the Airbus A320NEO, the Bombardier CSeries and the Mitsubishi Regional Jet. MTU has shares of up to 18% in these engines.

    Now CEO Egon Behle says MTU aims to participate with GE on the engine for the next Boeing 777.

    GE has been the exclusive supplier for the longer range 777s with its GE90-115B, so one can assume GE is in the lead position to power the new airplane. While not on the GE90, MTU has a 6.5% risk share in the GEnx, for which it supplies the turbine center frame. The GEnx will likely be the basis for GE’s offering on the new 777.

    Ask Behle about whether MTU will also be part of Pratt & Whitney’s bid to power the new 777 with a geared turbofan, and there isn’t a clear answer, just a, well, um, er, there could be many possibilities.

    Students of history remember 1990, when MTU, then owned by Daimler-Benz (the precursor of EADS), shocked GE by pulling out of the GE90 program and allying itself instead with Pratt & Whitney on the PW4000 as the engine makers bid to power the then-new Boeing 777.

    GE sued MTU for $1.5 billion. And as GE CEO Brian Rowe said at the time, “If you haven’t got a compressor, you haven’t got an engine.” GE was left to design its own compressor.  MTU, as it transpired, backed the wrong horse.

    The rest is history. The GE90 became a massive success story, without MTU. The irony is that MTU is now competing with GE to overhaul GE90 engines, while it works with Pratt & Whitney on geared turbofans that may, or may not, include an engine for the new Boeing 777.

    Life can be tough when your partners may also be your competitors, and you want a foot in both camps.

    Tags: ila12

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