Rolls-Royce Suspends Production of Engines for Airbus A380 after Delays in Superjumbo Plans

The company said it expects to deliver no more than 30 of the engines to Airbus this year.


British aircraft-engine maker Rolls-Royce PLC said Friday that it is suspending production of engines for the Airbus A380 for about 12 months because of delays in the superjumbo airplane project.

"We informed the employees yesterday," said Martin Brodie, a spokesman for Rolls-Royce.

The company said it will continue development work on the Trent 900 engine for the A380, and said the suspension would not affect earnings guidance for this year.

The company said it expects to deliver no more than 30 of the engines to Airbus this year.

Rolls-Royce is contracted to supply engines for 48 percent of the current firm orders for the A380, while General Electric Co. is supplying the rest, Brodie said.

The decision by Rolls-Royce to suspend production follows suggestions from leading commercial airlines who have ordered the A380 that they were assessing their positions after Airbus said this week that deliveries of the plane would be delayed for another year.

Emirates, Virgin Atlantic Airways, Singapore Airlines and Qantas are among those affected by the delay.

Airbus had already stunned investors in June by doubling the A380's production delay to one year. The delay announced this week extends that to two years and the company has warned the accumulated holdups would cut 4.8 billion euros ($6.1 billion) from operating profit for its parent company, European Aeronautic Defence and Space Co.

Rolls-Royce said its British plant, which employs 11,000 workers, would still be producing engines for other companies including Airbus' U.S. rival Boeing Co. and Canada's Bombardier Aerospace.

Rolls-Royce is building engines for Boeing's 787 passenger jet, which is due for delivery in 2008.


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