The 10-year battle between Connecticut's two largest companies over a $336 billion portion of the commercial jet market will heat up in mid-July.
At the Farnborough International Airshow starting July 9 in the United Kingdom, Fairfield-based General Electric and Hartford-based United Technologies Corp. will announce the orders for their next generation of engine for the most popular commercial airplane.
"It is an interesting battle," said William Storey, president of Virginia aerospace intelligence firm Teal Group. "It is where the majority of the engine dollars will be for the next 30 years."
Both GE Aviation and UTC subsidiary Pratt & Whitney of East Hartford have developed new engines for narrowbody airplanes — single-aisle aircraft that comprise the bulk of airlines' fleets. GE and Pratt's engines are touted to save at least 15 percent on fuel costs, but the two companies must fight for customers to prove their engine is the better of the two options.
Between 2012 and 2021, GE, Pratt and their partners will split $336 billion in expected new engine orders. Over the entire generation of this engine — expected to expire around 2030 — the market potential is $500 billion.
"There's a lot of money there," Storey said. "The players make out pretty good in all the scenarios."
Pratt's engine in this battle is a version of its much celebrated geared turbofan, called the PurePower commercially. The technology offers aerodynamic improvements, where a smaller core is needed to provide thrust. The company claims the engine will produce double-digit reductions in fuel use and environmental emissions, as well as a 50 percent noise reduction.
GE's engine is the latest version of its LEAP technology. The engine offers a split between aerodynamic and thermodynamic improvements, where a smaller core provides thrust while offering a more efficient compressor to burn less fuel. The Fairfield company claims this engine will provide reductions of 15 percent fuel use, 50 percent in environmental emissions, and 10-15 percent in noise reductions.
"Performance is no good if you don't deliver it," said Bill Brown, marketing general manager for CFM, which is GE's partnership in the LEAP technology. "People talk about performance, but reliability is what matters."
Over the life of this generation of engine, the market is expected to need between 20,000-30,000 new narrowbody planes, leaving possibly 60,000 engines up for grabs.
The majority of narrowbodies sold will be made close to evenly between Boeing of Seattle and Airbus of France, said Storey. Other airplane manufacturers will take the remainder of the market, such as Bombardier of Canada, Irkut of Russia, and Comac of China.
GE already won an early part of the battle as Boeing agreed to make the LEAP the only engine available for its 737MAX narrowbody. The LEAP also is the sole source engine for the Comac narrowbody plane.
"That is the first win," Brown said. "Can you convince an experienced airframer that you have the best engine?"
GE has racked up 2,470 engine orders on those two agreements with Boeing and Comac, selling their engines to customers such as American Airlines, Southwest Airlines, and Air China.
Pratt's PurePower is the sole source engine for Bombardier and Irkut narrowbodies. The East Hartford company has racked up more than 1,500 engine orders from these two contracts.
The bulk of the fight will be over the Airbus narrowbody, the A320neo. Airbus is letting its customers choose the engine, leaving Pratt and GE to go directly to the airlines to sell the PurePower and LEAP.
"If both engines meet their performance targets, they will split that market 50/50," Storey said.
GE has secured 1,156 engine orders for the A320neo, compared to Pratt's 976.
For every engine sold for the Airbus A320neo, GE splits the proceeds evenly with its partner, French engine designer Snecma, as it does with every LEAP sale. Pratt will keep 59 percent of its A320neo engine sales while giving 23 percent to Japan Aero Engines Corp. and 18 percent to German manufacturer MTU Aero Engines AG.
At Farnborough starting July 9, both GE and Pratt will make announcements regarding sales of their narrowbody engines. The deals have been in the works for several months, but Farnborough is where the companies make the announcements. Each year's major airshow flips between Farnborough and Paris; last year Paris yielded several billion dollars in engine contract announcements.
"Farnborough is definitely really important to us," said Katy Padgett, spokeswoman for Pratt. "It is a consolidated time period to have a lot of meaningful conversations."
Pratt will have a leg up because its engine is expected to be in-service by fall 2015 while GE's engine won't be ready for service until 2016.
With this head start, Pratt has more testing completed and can provide potential customers with more proof the technology will fulfill its fuel, environmental and noise promises, Padgett said.
"We have real engines that are performing the way we are expecting them to perform," Padgett said. "We have the advantage of having all that test data."
The market sees GE as having a bigger technological challenge to reach their performance promises with the thermodynamic and aerodynamic improvements, Storey said. If GE can't meet its performance promises on the Boeing 737MAX, then the market for the A320neo will slide toward Pratt.
GE sees the extra time as a chance for further testing of its engine, Brown said. Pratt won't drastically outsell GE in the first six months in a battle that will last a generation.
"It gives us more time to bring the engine out and finesse it," said CFM spokeswoman Jamie Jewell.
GE has put out 10 variations of the LEAP engine for the last 20 years, giving the Fairfield company an opportunity to build on its past technology to perfect it for the future, Brown said.
"The success of the LEAP engine is not determined as much as what will happen by 2016, but by what you have done in the 15 years before it," Brown said.
Despite the appearance that Pratt and GE are having a huge battle for A320neo engine orders, the companies will both make out over the next 10 years, even if one ends up with a lopsided 60 percent of the $336 billion pot.
"It is more of a friendly rivalry, and colleagues in an industry we are both pretty successful," Brown said.