Jet suppliers cite potential gain from Airbus move

By Reuters
Posted Dec. 2, 2010 at 4:52 p.m.

Aircraft suppliers Rockwell Collins and Goodrich said on Thursday they could gain new business as a result of this week’s announcement that EADS unit Airbus would upgrade its A320 plane with better engines that offer 15 percent fuel savings.

Airbus, the world’s largest plane maker, said it would spend roughly $1.3 billion to improve efficiency of the narrowbody aircraft. Its main rival Boeing is also mulling whether to upgrade its competing 737 plane.

Goodrich, which already supplies nacelles to the Airbus jet, told an investor conference hosted by Credit Suisse and Aviation Week that it has bid for work and expected to continue to have positions under the re-engined program.

“We also have a lot of other products on the aircraft,” Cindy Egnotovich, president of Goodrich’s nacelles segment, said.

Cockpit supplier Rockwell Collins said that while the re-engine program does not principally involve systems that it provides, there still could be a chance to pick up business should Airbus make other plane changes.

“There’s always the opportunity that (Airbus) could make optional upgrades to some of the cockpit or some of the electronic equipment on the airplane that could present an opportunity to us,” Clay Jones, the Rockwell CEO, said at the conference.

Jones also said another delay was expected with the Boeing 787 Dreamliner program. Boeing is making design changes to electrical distribution panels and updating power-managing software on the carbon-composite 787 following a fire on a test flight last month that led to grounding of the test fleet.

“We’re not exactly sure what the impact of the recent incident is going to be,” Jones said.

Goodrich Chief Financial Officer Scott Kuechle said an added delay in the 787 program, which is already nearly three years behind schedule, could result in “probably slightly lower sales” for the company in 2011 and “no impact whatsoever” on per-share profit.

Shares of Rockwell Collins gained 1.7 percent to $58.34 on Thursday, while Goodrich was up 74 cents to $86.64.

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