Engine makers: 2. P&W , IAE

From:         Andrew Chuang <chuanga@iia.org>
Date:         11 Aug 94 02:18:15 
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Pratt & Whitney

Before the widebody era, Pratt & Whitney owned the jet-powered commercial
airplane market.  They once captured well over 90% of the non-Soviet market
with the JT3D (which powered the B707 and DC-8) and the JT8D (which powered
the B727, B737-100/200, DC-9, and MD80).  The JT8D is the most widely flown
engine in the world, and the -200 series are still in production.  However,
with the introduction of the V2500-powered MD90, the days of the MD-80/JT8D
line are numbered.

P&W's first high-bypass turbofan engine, the JT9D, was originally the sole
powerplant for the B747.  Later, the JT9D had also found applications on the
DC-10, A300/310, and B767.  The engine initially suffered many technical
difficulties on the B747.  This probably was a major factor that Boeing was
asked to offer CF6- and RB211-powered B747s, and P&W lost almost all European
B747 customers to GE or R-R.  The fact that the JT9D is the most short-lived
turbofan engine is a further proof of the engine's technical problems.
Disputably, the JT9D commenced P&W's declining market share.

Since the JT9D, P&W have introduced two new engines: the PW2000 and PW4000.
Both engines are competitive, but neither has achieved the success that the
JT8D enjoyed.  The PW2000, originally designated as the JT10D, has only one
Western commercial application--the B757.  (The McDonnell Douglas C17
Transporter is powered by the military version of the PW2000.  The Russian
four-engined Il-96M will be certified with the PW2337.)  In the B757 market,
the PW2000 competes with Rolls-Royce's RB211-535E4.  In terms of number of
B757 customers, Rolls-Royce have an overwhelming advantage over P&W.  On the
other hand, in terms of number of installed engines, the PW2000 is only
slightly behind the -535E4.  Just the PW2000-powered B757 fleet of Delta,
United, Northwest, and UPS already accounted for more than 40% of the B757 in
service, yet, Rolls claim to have 75% of the B757 market.  Nevertheless, by
my count, about 65-70% of the B757 on order will be powered by the -534E4.

About ten years ago, P&W launched the PW4000 to replace the JT9D, because
the JT9D could no longer be grown to meet the requirement of heavier and
longer-range derivatives of the B747, B767, the A300, and the MD11.  P&W
were able to keep some important customers, such as the now-defunct Pan Am
(PW4000 launch customer), Northwest, United, and Singapore, so that P&W
still have a respectable, but not dominating share of the big engine market.
Although, the JT9D powered more than 70% of the older B747s, P&W has
captured only 30-35% of the B747-400 market.  Approximately five or six
years ago, one of Pratt's most loyal customer, Japan Airlines, ordered GE's
CF6-80C2 engines for their B747-400 fleet.  It was a big blow to P&W.
Ironically, it was JAL's recent PW4000 order for the B777 that helped P&W to
gain the majority of the B777 market.  BTW, the PW4000 is also the leader in
the A330 market: this is a first for P&W on an Airbus plane.

While P&W is doing relatively well in North America and the Far East, P&W is
extremely weak in the European market: Swissair's MD11 fleet as well as SAS's
and Condor's B767 fleets are the only sizable PW4000-powered fleet in Europe.
Similarly, Condor is the only significant PW2000 customer in Europe.  Recent
talks of cross-equity investment with Germany's MTU should help P&W to regain
some of the European market.  MTU is the also most significant partner of the
PW4084 program.

Significant customers: United, Northwest, Delta, Japan, Swissair, Singapore.

International Aero Engines

Without a high-bypass 20,000-30,000-lb-thrust-class engine to compete with
the CFM56, P&W teamed up with Rolls of Britain, MTU of Germany, Fiat of
Italy, and JAEC (a Japanese joint venture) to form IAE.  IAE's V2500 competes
with the CFM56 for the A320/321/319 market.  A few years ago, the V2500 was
selected as the only powerplant for the MD90, but the smaller, yet-to-be-
launched MD95 will be exclusively powered by the BR715 which is jointly
developed by BMW and R-R.  The V2500 had a minor setback when Boeing decided
not to offer multi powerplants for the third-generation B737-6/7/800.
Despite the setback, IAE is actively searching for new applications.  A
possible application is to reengine the B727-200 with two IAE2530-W5s.

Initially, IAE had a hard time picking up Airbus customers because of its
late start.   In the last few years, IAE won some big A320 orders from
American West and United.  These orders certainly boosted the IAE order book,
however, CFMI still have a big lead.

Significant customers: Lufthansa (only 20 A321's; it's significant because
		       Lufthansa switched from CFMI to IAE), United,
		       American West, and Delta (MD90)