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Supplier dispute will slow Gulfstream G500 deliveries

Gulfstream’s rate of deliveries on the newly-certificated G500 business jet will be slowed this year as a result of a financial dispute between two suppliers for the propulsion system.

Nacelle supplier Nordam filed for bankruptcy on 23 July two weeks after halting production on the nacelle for the Pratt & Whitney Canada PW800, the turbofan engine that powers the G500. Nordam and P&WC are in discussions about resolving a contractual dispute over the cost of the development programme.

"The current issue will have some impact on our deliveries to some extent this year but it is solveable," says Phebe Novakovic, chief executive of Gulfstream parent General Dynamics. “We are confident the parties will expeditiously resolve their disputes.”

The supplier dispute lingers even after the US Federal Aviation Administration approved a type certificate for the G500 on 20 July, paving the way for deliveries of production aircraft to begin. The FAA approval includes an endorsement of the current nacelle design, following testing and documentation issues that arose with the component during the development process.

“We've had some challenges, [and] they’ve had some challenges in terms of getting their products certified and the cost has been a challenge for them as well,” Greg Hayes, chief executive of P&WC parent United Technologies, explained on a 24 July earnings call.

“We’ve been working with them very closely for the last six months, and I think it will be a pretty – not easily managed — but at least a good outcome here in the not too distant future,” Hayes says.

Gulfstream launched the G500 in 2014 with a plan to certificate the first aircraft this year. Last year, Gulfstream announced plans to accelerate the certification of the G500 to the end of 2017, but missed that target with Hayes citing problems with an unspecified supplier.

In addition to the PW800 engines, the G500 also features a wider fuselage than the G650 and active sidestick inceptors for the fly-by-wire flight controls.

“I’m pretty comfortable that we will get through this” supplier dispute, Novakovic says. “And the sooner we get through it the better.”

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