Airbus’s Reputation Takes Dive Along With Rolls-Royce

By Ilya Rzhevskiy, Epoch Times
November 18, 2010 Updated: October 1, 2015

FAULTY ENGINES? An Airbus A380 lands following an air display at the Farnborough International Airshow in Hampshire, England, this summer. (Ben Stansall/AFP/Getty Images )
FAULTY ENGINES? An Airbus A380 lands following an air display at the Farnborough International Airshow in Hampshire, England, this summer. (Ben Stansall/AFP/Getty Images )
The reputation of Airbus, the maker of A380 planes, has seen a sharp drop following an incident on Nov. 4, where a Qantas Airways A380 plane experienced an engine blowout on its trip from Singapore to Sidney.

Luckily none of the 466 passengers or the crew onboard were injured, as the plane landed safely with a charred engine and a wing damaged by shrapnel hurled from the turbine.

The faulty Trent 900 engine in A380 was designed by Rolls-Royce, the global power systems company based in the United Kingdom. There is an enormous amount of pressure exerted on Rolls-Royce by Airbus to fix the problem and prevent any further accidents. Meanwhile, Qantas has grounded six of its A380 planes.

Rolls-Royce has affirmed that it is working hard on identifying the root cause of the problem and will replace the defective part for all of the Trent 900 engines it manufactures.

“Safety is the highest priority of Rolls-Royce. This has been demonstrated by the rapid and prudent action we have taken following the Trent 900 incident. We have instigated a program of measures in collaboration with Airbus, our Trent 900 customers and the regulators. This will enable our customers progressively to bring the whole fleet back into service. We regret the disruption we have caused,” said Sir John Rose, the CEO of Rolls-Royce Group plc, in statement.

“This event and the consequent actions will have an impact on the [Rolls-Royce] Group’s financial performance this year. However the scale of our order book, the breadth and mix of our portfolio, the global nature of our business and our strong balance sheet makes Rolls-Royce a resilient business, and we expect continued underlying profit growth in 2010,” he added, reassuring the investors that the company is still on track with its profits.

The investors had welcomed the reassurance statement from Sir John Rose last week, and the confidence sent up its sunken shares back up 27 pence to 599 pence (US$9.58) on Wednesday, increasing the market value of Rolls-Royce by 1.3 billion pounds (US$2.07 billion). That is still however lower than before the incident, when the shares were 655 pence per share.

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