RTX to take $3 billion charge on Pratt & Whitney engine problem

0
140

Benoit Tessier

Benoit Tessier | Reuters

RTX said Monday that an engine manufacturing flaw forcing accelerated inspections will hit its pretax results this quarter by $3 billion, sending shares lower in premarket trading.

The problem stems from flaws with powder metal used to make some of the popular Pratt & Whitney GTF engines. This issue has forced inspections of hundreds of engines before schedule. It is also preventing airlines from using some planes during the travel recovery following the pandemic. It said that it

expects to take a $1.5billion hit to its cash flow in 2025. This will bring the estimate down to $7.5billion from an earlier estimate $9billion. Pratt & Whitney owns a share of 51% in the GTF PW1000 program, and costs will be shared.