It may rank number five in the world, but Germany's biggest aeroengine maker MTU is content with its market position. Although it sells no complete engines under its own brand, its impartiality and wide-ranging specialisms have led to it partnering all four of its bigger counterparts - as well as most of the world's smaller engine makers - in both civil and military spheres.
The company's risk-spreading model gives it a stake in many of the most promising and lucrative commercial programmes, including the Boeing 787-powering General Electric GEnx, the Engine Alliance GP7000 for the Airbus A380, and current and future narrowbodies as a partner in both the International Aero Engines consortium and the Pratt & Whitney PW1000G geared turbofan.
"It is a big advantage for us to be independent," says Egon Behle, chief executive of the Munich-based company, which after a long history of ownership by the likes of Daimler and BMW is now publicly traded. "It helps us to be attractive to each OEM and this permits us to take shares in different consortia and programmes."
MTU's MRO network has grown beyond Germany, to include sites in China and Canada. Picture: MTU
P&W remains MTU's biggest partner - it contributes to at least five programmes for the Hartford-based firm and its Canadian subsidiary, as well as the IAE V2500
in which P&W is also a partner. On the GTF - which will power the Bombardier
CSeries and Mitsubishi MRJ
regional jet - MTU manufactures the forward four stages of the eight-stage high-pressure compressor.
However, GE is catching up, thanks to the GEnx. Although MTU's contribution is modest - it has developed and manufactures the turbine centre frame - the huge production ramp-up to fulfil the 1,400-strong orderbook should bankroll MTU for some time. "In three to four years time, our GE business will be fairly balanced with P&W," says Behle.
Luck has been on MTU's side. Although it was hit by the 787 delay and Airbus Military A400M debacle - it is part of the Europrop consortium behind the military transport's TP400-D6 engine - the company has been less exposed to the collapse in demand for light business jet engines. The sector is responsible for only 5% of its revenues, which last year dipped 4.2% to €2.6 billion ($3.25 billion).
The customer rescue of the A400M earlier this year will have come as a huge relief. Defence - including maintenance, where the German military is a huge customer - represents about a fifth of MTU's turnover, with the Eurofighter's Eurojet EJ200 the dominant programme.
With European orders for the Typhoon and the A400M seemingly secure, Behle is now eyeing what he says is their "huge export potential". MTU has also been successful in the US market. As well as contributing to the Boeing F/A-18's GE F414 engine, MTU has an 18% share - including development - on the GE38 for Sikorsky's CH53K heavylift helicopter. "This is the first time we have entered a US military programme with development responsibility," says Behle.
Although MTU no longer manufactures in the USA, it retains an engineering site in Hartford. Its big overseas expansion, however, has been into neighbouring Poland, where in 2009 it opened a plant in Rzeszow's "Aviation Valley" and moved much of its "medium technology" activities.
"It is much more economical and we plan to grow there, but we are comfortable keeping high-end, high-automisation parts in a high-cost market like Germany where we have access to engineers around the corner," says Behle.
In addition, MTU has been developing its aftermarket network. As well as domestic facilities in Hanover and Berlin, it has overhaul centres in Vancouver and in Zhuhai as a joint venture with China Southern Airlines. Zhuhai is the biggest engine overhaul operation in the country, claims Behle, with capacity for 200 engines a year. MTU plans to invest another €2 million in the plant in 2011-12.
China also represents an opportunity in original equipment. MTU has an agreement with state engine firm ACEC to explore a possible co-operation on an indigenous Chinese commercial airliner engine. "We expect to take a decision whether to move forward by the end of the year," says Behle. "With a demand for 4,500 aircraft in the next 25 years, it is a strong market and China will want to produce their own engines in their country." But they will have to do it in partnership with Western industry and Behle predicts the creation of "something like a Chinese IAE".
A more pressing decision for Behle and his IAE colleagues, however, will be the propulsion question for re-engined narrowbodies from Airbus and Boeing. MTU is in the fortunate position of having a bet on two of the riders in a three-horse race - CFM International being the third. "All the IAE partners have said that the consortium is our preferred route to market," says Behle.
"However, the engine that is offered will have to be absolutely competitive and fit with the customers' requirement. The GTF is highly competitive so if there is not an IAE offering, then of course MTU will continue our relationship with Pratt."