LONDON (ShareCast) - (Sharecast News) - Rolls-Royce shares suffered some turbulence on Tuesday after two Singapore Airlines planes were grounded because their Trent 1000 engines were wearing out faster than expected.
The carrier, which was one of the first airlines to receive 787-10 aircraft, grounded two of its Boeing 787 airliners as their engines were suffering from "premature blade deterioration".

Singapore Airlines said it had taken the planes out of service for repairs after finding that turbine blades were wearing out faster than expected.

Last year Rolls-Royce spent £790m to fix faults with its Trent 1000 engine, after it suffered from problems since coming into service in 2011. The company indicated it had yet to see any issues on the TEN engines on inspections at that time.

Rolls said in a statement that it had warned airlines using the Trent 1000 TEN that the high-pressure turbine blades "would have a limited life cycle".

It has been sampling a small population of the Trent 1000 TEN fleet that has flown in more arduous conditions and found "a small number of these engines need to have their blades replaced earlier than scheduled" and engineers are already testing an enhanced version of this blade.

The company had already begun the process of re-designing the intermediate pressure compressor blades on the TEN engines and expects this to be certified by the third quarter of the year.

Analysts at Jefferies said deterioration on turbine blades was a "lesser issue" compared to compressor blade problems and said they assumed the Singapore Airlines engines are fitted with the original blades and have not yet been retrofitted with the new blade designs now being rolled out across the fleet.

"While we may have hoped that the 1000 TEN would be more reliable than earlier Trent 1000 engines, it is a derivative engine - as is the Trent 7000 for the A330neo - and we believe all versions of the Trent 1000 are covered by the same EASA airworthiness directives. That includes the same inspection regime. In short, the same reliability issues could occur in the 1000 TEN," Jefferies said.

Morgan Stanley said: "Our conversations with the company suggest this was viewed as a known risk factor, and believe it can be covered in existing guidance for Trent 1000 in-service costs of 'around £450m' in 2019 and £350m in 2020.

Whilst analysts saw a risk of further increasing cash costs on the programme if the number of affected engines expands, they noted there are only 140 TEN enginers out of the total 610 Trent 1000 engines in service, "so in-service disruption is likely to be lower previous issues on the larger Package C population (where a fix has been certified)".

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