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P&W signs $1.6 billion parts pact with UAL

 - December 11, 2006, 5:51 AM

Pratt & Whitney has signed the biggest airline spare parts management deal in its history, in a $1.6 billion contract with United Airlines. More than 60 percent of United’s engines now come under P&W care.

The 10-year, exclusive deal is for P&W’s materials management program (MMP) to support United’s fleet of PW4000 94-inch fan and PW4000 112-inch fan engines and calls for P&W to manage all of the airline’s parts inventory  and logistics, including new spare parts, used serviceable material and parts repair. United has 217 “94 inch” engines for its Boeing 747s and 767s and 117 “112 inch” engines powering its Boeing 777s.

To support the latest contract, P&W is building a dedicated materials and logistics hub at San Francisco International Airport, which will be completed by the end of the year.

In another deal, worth $300 million, P&W is to maintain Cathay Pacific’s PW4000-94 engines under a 10-year Fleet Management Program. The engines will be maintained at Eagle Services Asia, P&W’s Global Service Partners’ overhaul facility in Singapore.

Pratt & Whitney has been assiduously building up its engine support business. which now accounts for around 60 percent of total business. Senior vice-president for sales and marketing Mike Field said this compares with about 30 percent 10 years ago. “And it is increasing. We see some very significant business opportunities out there, on the same scale as United Airlines,” he concluded.