- The outgoing IATA director general has criticised engine manufacturers for poor performance.
- He has called on them to stop excessive charging and focus on reliable engines.
- Walsh has noted changes from past standards where engines required little maintenance.
- He has expressed regret over not raising the issue earlier in his tenure.
- Profitability of engine makers reached levels he viewed as high at 27pc.
Glansevin born Willie Walsh, the outgoing International Air Transport Association director general has delivered strong criticism of engine makers during his final address at the association’s annual general meeting. He highlighted ongoing reliability issues that lead to aircraft groundings and repair delays. Airline executives have supported these concerns in private discussions for some time.
Willie Walsh amplified his message in follow-up comments with journalists and during a press conference. He recalled a time when new aircraft engines performed reliably for years without major intervention. Walsh noted that he had no objection to manufacturers earning profits but objected to poor product delivery alongside those profits.
In later briefings, Walsh reflected on his tenure and mentioned that he regretted not addressing the engine makers earlier due to limited visibility into their individual profitability figures hidden within parent company accounts.
Willie Walsh shared: “Maybe the thing I regret, if I was to find something to regret, is that I didn’t have a go at the engine OEMs earlier. In the main, that’s down to the fact that I couldn’t really assess their individual profitability because it was hidden in the accounts of the parent companies. My message to the engine OEMs is simple: stop gouging us and get back to making great engines that work and that last. Allowing these failures to extend into the next decade is totally unacceptable to your customers I don’t think I was being harsh or rude by saying what I said, there’s something wrong here. I have no objection to them making money, none whatsoever, I admire them, but I have an objection to them delivering poor products and making money.”
I actually toned it down. I thought gouging was a soft word, my first draft was a bit stronger than that. When I look at our industry and I look at the effort that airlines are making to provide a service to our customers and to generate what should be a reasonable return and how hard we’re working and then I look at engine OEMs in particular who have disappointed us with the new technology engines that they’ve provided. And then I look at their financial performance and I see margins in the 20s. We don’t see margins like that.
So there’s something wrong. You clearly can’t have a supplier who’s failing to deliver the product to the customer and yet at the same time they’re increasing their profitability, I don’t think I was being harsh or rude by saying what I’ve said. I think there’s something wrong there and these guys really do need to start focusing on their customers and delivering engines that work and you know they used to do that. They make fantastic engines.
We never debated issues with engine reliability because we accepted that there would be some issues with new technology but these would get sorted out very quickly. I can remember you’d buy a new aircraft you wouldn’t have a debate around whether the engine was going to work or not. It was just taken for granted these engines will remain on the wing untouched for years and we just don’t see that, it’s changed and we need to get back to what was a good performance by engine manufacturers.
I have no objection to them making money none whatsoever I admire them. But I have an objection to them delivering a poor product and making money. That just doesn’t work for me. If airlines did that, they’d be out of business. The problem is we’ve got very little competition when it comes to engine suppliers, you could argue they can get away with it.
But if I was an engine manufacturer, I would not be pleased with my performance and I wouldn’t be going around highlighting how profitable I am. I’d be worried about what my customers would say about the performance of the product that they’re producing, they’re not doing the job that they should do. And I think it’s time that they get back to doing what they used to do and used to do well. And I think it’s only right that we call them out for their performance.
