June 4, 2012

Pratt’s Middletown decision more signal than substance

Contributed Photo
Contributed Photo
East Hartford aerospace manufacturer Pratt & Whitney researched and developed all variants of its geared turbofan engine at its Connecticut facilities, including the one pictured above at its Middletown complex. During the production phase, the company plans to perform final assembly and testing of the Airbus version of the engine at Middletown.

State and manufacturing industry officials are giddy Pratt & Whitney decided to maintain its Connecticut footprint — even if the state's smaller businesses don't see a major impact on their bottom lines.

East Hartford-based Pratt & Whitney announced on May 24 its Middletown complex will host final assembly and inspection of geared turbofan engines for the Airbus A320neo commercial narrowbody jet. This engine, also called PurePower, eventually will replace the A320's current engine, which also is assembled at Middletown.

Pratt has 967 firm orders for the A320neo PurePower, representing about $7.5 billion in total work.

“It is a very good signal,” said Catherine Smith, commissioner of the state Department of Economic and Community Development. “We have such a strong manufacturing base here, and we are happy they are taking advantage of that.”

With the geared turbofan replacing the current commercial engine work at Middletown over the next five years, state and industry officials worried Pratt would ship the PurePower work elsewhere, eating a significant chunk out of Pratt's manufacturing footprint in Connecticut.

Pratt — as an original equipment manufacturer, or OEM — has more than 600 suppliers in Connecticut alone.

Those suppliers like to see Pratt maintain its Connecticut presence, even though they likely would continue to supply the OEM if it chose to perform its PurePower assembly work outside of the state, said Allen Samuel, executive director for Aerospace Component Manufacturers, a trade association made up of Connecticut companies supplying Pratt and Fairfield conglomerate General Electric.

“We certainly like to see the work retained in Connecticut,” Samuel said. “It provides general support for manufacturing in Connecticut.”

Having a major OEM such as Pratt in Connecticut keeps the state recognized as a manufacturing hub and helps keep young people interested in manufacturing careers, Samuel said. This has a trickledown effect on the entire industry.

“Pratt is busy and employs a lot of people,” Samuel said. “This decision keeps the economy going and keeps those types of skills in Connecticut.”

Pratt is a subsidiary of Hartford conglomerate United Technologies Corp., which has a number of other Connecticut subsidiaries including Otis Elevator Co. in Farmington, Sikorsky Aircraft Corp. in Stratford, UTC Power in South Windsor, Hamilton Sundstrand in Windsor Locks, and Carrier Corp. in Farmington

Pratt did not receive any financial assistance from the state or local governments to keep the work at Middletown, said Smith.

Pratt's decision to perform final assembly and inspection of the A320 PurePower engine was based solely on business, said Pratt spokesman Bryan Kidder.

The decision is “based on a number of factors that make this the right choice for our company at this time,” Kidder said.

Smith said while DECD didn't need to offer any financial incentive for Pratt to perform the work at Middletown, the state remains commitment to keeping Connecticut as a major manufacturing hub.

“UTC and (Groton submarine manufacturer) Electric Boat are our anchors that help the smaller manufacturers around the state,” Smith said. “We are taking time to understand what the bigger anchors need as well as the smaller guys.”

Without major OEMs like Pratt and Electric Boat, the Connecticut companies that supply them wouldn't have the natural advantage that comes from being located close to their customers, said Jerry Clupper, executive director of the New Haven Manufacturers Association. If the anchors aren't here, there is less incentive for their smaller suppliers to stay in Connecticut, or for new ones to choose to locate here.

“We want to keep in mind that the customers of the smaller manufacturers are the larger OEMs like United Technologies,” Clupper said. “They felt it was a positive thing that Pratt & Whitney committed to keeping its current footprint in Connecticut.”

Without the large anchors, Connecticut's manufacturing sector is made up of just the smaller suppliers, Smith said. That is not the best way to keep the state on the leading edge of the industry.

Pratt's decision to maintain its Connecticut footprint prevents state officials from having to worry about that possibility for some time, Smith said.

“We are glad that they did, and we look forward to working with all the United Technologies subsidiaries soon,” Smith said.

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