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RTX warns of profit hit as 600-700 GTF engines to be removed for quality checks
© Reuters. FILE PHOTO: Visitor passes the Raytheon Technologies Corporation (RTX) logo at the 54th International Paris Air Show at Le Bourget Airport near Paris, France, June 22, 2023. REUTERS/Benoit Tessier/File Photo
(Reuters) – Aerospace supplier RTX said on Monday 600 to 700 geared turbofan engines (GTF) will have to be removed for quality checks, which will result in a $3 billion to $3.5 billion pre-tax hit to its profit over the next several years.
The quality issue relates to a rare condition in powder metal used to manufacture certain engine parts.
Shares of the company, whose GTF engines power about half of Airbus A320neo fleet of jets, fell 3.6% before the bell.
“The accelerated removals and incremental shop visits will result in higher aircraft on ground,” RTX said in a statement.
The company expects to record about $3 billion in pre-tax charge in the third quarter, after partners’ share of charges.
Pratt & Whitney is also analyzing the impact of the quality issue on other engine models in its fleet, but that impact is expected to be far less, RTX said.
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