Engine Maker to Boeing-Airbus: Not So Fast on 737, A320 Ramp

(Bloomberg) -- The largest manufacturer of jet engines has a message for Airbus SE and Boeing Co. executives who’re mulling a boost in production of their narrow-body jetliners next decade: not so fast.

CFM International Inc. won’t contemplate picking up its pace for at least a year as it shores up the engine supply chain and works to end production lags, Sebastien Imbourg, an executive vice president of the General Electric Co.-Safran SA venture, told reporters Saturday.

Sales are booming for Boeing’s 737 Max and Airbus’s A320neo family, and production is oversold through the early 2020s even with increases under way that would push output to about 60 jets a month apiece. Airbus executives have said they are in talks to ramp up even more -- speeding factories to churn out as many as 70 or 75 of the jetliners a month.

Engine Maker to Boeing-Airbus: Not So Fast on 737, A320 Ramp

“We are discussing with the airframers continuously their request,” Imbourg said during a briefing ahead of the Farnborough International Airshow. “Today we are not going to commit to a higher rate. We are looking continuously at the supply chain. We are already on a very incredible ramp-up.”

The engine manufacturer is on pace to deliver more than 2,100 units this year, the highest output in its history. The totals include 1,100 of the new Leap variants that power the Airbus A320neo and the 737 Max, and 1,050 of the CFM56 engines designed for the previous generation of the planes. This month marks the transition point at which CFM will be building more of the Leap than the CFM56.

Behind Schedule

But introducing a new engine family at a time of soaring production has proved challenging for CFM and its suppliers. The venture has been rushing to get back on schedule after deliveries slipped to six or seven weeks behind schedule earlier this year. The backup has shrunk to four or five weeks and CFM expects to fully recover within the next several months, said Allen Paxson, executive vice-president of the venture. CFM said its current pace of production is ahead of target.

CFM has been in touch daily with the planemakers, while sending teams to help suppliers struggling to keep pace or achieve yield targets -- a measure of efficiency in their factories, Paxson said. While its turbofans feature leading-edge technology, the bottlenecks have centered around traditional casting and machining shops, he said.

The company also has dealt with a handful of teething issues since the Leap debuted two years ago. The latest involves chipping of a protective coating on the inner wall of its high-pressure turbine that has caused the engines to burn hotter and slightly lower the fuel efficiency.

New Coatings

The engine venture introduced a new, thinner coating in June, and the so-called shroud is being installed on the Leap turbines in its factories. CFM is applying the new coating on engines that are already in use as they are brought in for service, Paxson said. No aircraft have been grounded for the repair.

Adding to the pressure on CFM are glitches experienced at Pratt & Whitney, its rival on the A320neo, that led to suspension of deliveries of its geared turbofan engine for close to three months at the start of the year. Airbus has faced higher demand for the original A320, prompting CFM to produce 400 to 500 more of the older CFM56 model than it had anticipated, CFM Chief Executive Officer Gael Meheust said at the briefing.

“It’s a nice problem to have,” Meheust said.

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