Rolls facing bigger bill for jet engine checks

ROLLS-ROYCE has warned of a bigger than expected drain on cashflow from problems with its latest jet engines.

The engineering giant said it will have to carry out more inspections of engines in service than previously budgeted for, pushing up costs.

In its annual results last month, Rolls-royce flagged up an expected £300m-plus price tag over the next two years for repairing cracking and corrosion in the compressor and turbine blades of the Trent 1000 jet, an issue first identified in 2016.

Despite the additional expense of the inspections, Rolls said it still expects to hit its annual free cashflow target of around £450m this year and £1bn by 2020 by “reprioritising various items of discretionary spend” to account for extra costs from the Trent 1000.

Warren East, chief executive, declined to put an exact cost on the latest problem but said the company would do “all we can to minimise any impact on customers’ operations”. He added: “We sincerely regret the disruption this will cause to our customers. Our technical experts and service engineers are working around the clock to ensure we return them to full service as soon as possible.”

The issue affects Boeing’s 787 Dreamliner jets that are powered by Trent 1000 engines, which cost about £7m each. Rolls-royce has about 500 Trent 1000 engines in service, which have been hit by four similar problems.

The company is already replacing blades in the turbines, which are not lasting as long as expected. The other two issues relate to the compressor, and the latest announcement specifically covers 380 “Pack C” engines, which will now be inspected earlier.

Mr East said Rolls-royce had staffed up to get the checks done as quickly as possible and install replacements where required. He expects to have staff inspecting 200 engines within the next fortnight.