Rolls-Royce has announced new orders at the show for its established Trent 700 engine for the Airbus A330 and its latest Trent XWB for the A350 XWB, taking both models past the 1,000-order milestone. The UK manufacturer's senior vice-president customer business talks to Andrew Doyle about the company's sales strategy for the Middle East region
What is the focus of your participation at the show?
The message here is the strong position of the Trent 700. We've now gone past 1,000 engines in service or ordered, and have also gone past 1,000 engines ordered for the XWB. The common theme is that we underpin these engines with the TotalCare support service, which we very much see as an industry leader and something that gives real value to our customers.
Overall, the Trent 700 is pushing 55% market share on the A330. Over the last three years we've got nearly 75% market share. In the Middle East we've got eight of the nine A330 operators, and out of those eight, seven have TotalCare and we're in discussion with the eighth. The Trent 700 is very successful all around the world, but it's even more successful in the Middle East.
Why do you think the Trent 700 has been particularly successful in the Middle East?
The Middle East is a market that has genuine structural growth. It's real - it's new routes, airports, demand and people flying. If you need take-off performance, time-on-wing and "hot and high" capability, the Trent 700 is the engine that you need, whether you're Yemenia flying out of Sana'a or you're Emirates flying out of Dubai in the middle of the day.
The 700 started with an inherent advantage because it was designed for the A330 and the competition were offering derivative engines. The inherent flexibility of the three-shaft engine means that we can optimise the engine for whatever airframe it might be.
For the Trent 700EP (enhanced performance), we took features such as elliptical leading edge technology which we'd been working on for the International Aero Engines V2500 Select and the Trent 1000, and put them into the Trent 700.
How significant have commitments from Middle Eastern carriers been in helping you achieve the 1,000-orders milestone with the Trent XWB?
We've been very successful with the XWB in terms of significant orders from Emirates, Qatar Airways and Etihad, Qatar being one of the launch customers with an order for 80 A350s. We've also sold it to Yemenia. The legacy of the Trent 700, coupled with these operators seeing real value from the TotalCare service, has meant that we are readily seen as a very credible supplier, and therefore we've been in no way an inhibitor to the success of the aircraft.
We'll make further developments to meet the needs of the A350-1000 stretch, and to some extent those improvements will be fed back to earlier versions of the engine.
How bad has the impact of the global economic downturn been on your Middle Eastern airline customers?
The compounded revenue passenger-kilometre growth has been 15% since 2004, and if you look at the period from June 2008 to June 2009, which crudely I would say were the worst 12 months of the whole downturn, they we still going up 6%. All through it they've managed to keep their loads up in the region, although like all airlines they've been facing pressure on their yields.
We now think they're back to double-digit growth in RPKs, so we think they're over the worst. The signs look promising. We think we're going to see continued growth. You only have to look at what aircraft they have already got on order - that in itself would be a significant growth. They have to keep growing, and so far the evidence is that they will be able to.
Why has your TotalCare support offering been particularly popular in the Middle East?
They are rapidly growing airlines and part of what TotalCare is about is getting the people that best understand the product - the original equipment supplier - to look after the product. We say to the customer: "You concentrate on running your airline." We're not just like a garage, we bring quite a lot more than that. We bring the OEM expertise, and our operations room so that we can call up data from our engine monitoring guys.
We are also the people that are best positioned to design improvements, and TotalCare is a very good way for us to bring improvements into the engines. We also address the drivers that are sending the engine off wing, because we make more money if the engine stays on wing for longer. It aligns our interests with those of the airline.
Is it still the case that the Middle East carriers tend to dislike the concept of rotable parts?
It differs by component and by customer. In the main the customers know that we stand behind the engines that we've supported and reworked under TotalCare. That addresses most concerns. Yes there are certain key components and certain line replaceable units where the airline may want to keep an independent capability, but the core engine part we've been very successful selling to seven out of the eight Trent operators.
What approach has Rolls-Royce taken towards establishing joint ventures in the Middle East?
Generally we've tried to do it in a collaborative way. In Qatar we're doing a couple of things. We're signing a tenancy agreement for the Qatar science and technology park. We are there working on a joint venture with our OSyS subsidiary, which takes our engine health monitoring expertise and looks at how you can apply it across non-aeroengines. Similarly, through the Qatar science and technology park we're supporting the work the Qataris are doing on gas-to-liquid fuel. Across in the UAE we have education programmes, and we're also working with Abu Dhabi on an on-wing care and rotables programme.
Through our relationship with Etihad we're helping Abu Dhabi Aircraft Technologies look at acquiring a Trent 700 capability. We have a strong presence in defence in Bahrain and Saudi Arabia through various joint ventures and activities around maintenance, repair and overhaul.
Source: Flight Daily News