Skip to content

OM in the News: Pratt & Whitney’s Supply Chain Falls Short

September 19, 2016

pratt-enginePratt & Whitney, the giant jet engine maker,  just warned it will miss its 2016 goal for deliveries of a new “geared turbofan” jet engine by 25%–likely shipping 150, down from a target of 200. Pratt has staked a decade and $10 billion in R&D on the new family of engines, writes The Wall Street Journal (Sept. 17-18, 2016). “Suffice it to say the airlines aren’t happy they’re not getting the engines,” CEO Greg Hayes said. “We’re not happy we’re not delivering.”

Pratt previously warned the introduction of the new engine will put pressure on its supply chain, but still hopes to deliver 400 of the new engines in 2017. The company says it will churn out more than 1,000 of the engines by 2020, part of an effort to attack a backlog that now includes some 8,200 engine orders.

But problems have bedeviled the ramp-up. A new logistics center run by United Parcel Service, under contract with Pratt to organize the delivery of the more than 800 parts that make up an engine, has developed some kinks. Pratt also angered some customers when the first geared turbofans it delivered had a flaw that required airlines to use longer-than-expected cool down times between flights to avoid engine damage.

“There are five parts that are causing us pain this year,” stated Hayes, “because suppliers haven’t been able to deliver them in sufficient numbers and quality to keep pace with engine assembly. A particular problem has been the newly designed aluminum-titanium fan blades. We’ve just struggled because of the technology involved in these blades.” He added that he had just visited the shop where blades are produced. “Today it takes us about 60 days to build the blades through the shop and that needs to get to 30 days.”

Classroom discussion questions:
1. Is this an unusual production problem in the aircraft industry? Why?

2. Discuss the UPS arrangement with Pratt. Advantages? Disadvantages?

Advertisements
No comments yet

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Supply Chain Management Research

Andreas Wieland’s supply chain management blog for academics and managers

better operations

Thoughts on continuous improvement: from TPS to XPS

%d bloggers like this: