Rolls Royce reported a net loss of £909 million (€988.74 million) for the first half of 2019. The manufacturer said it was about to fix the problems affecting its Trent 1000 engines.

The company’s financial results were affected by the interruption of the A380 production. Rolls Royce was producing the Trent 900 for the superjumbo. It assessed the total impact at £245 million of exceptional costs. The large restructuring plan, announced in June 2018, also added £69 million in charges this half-year.

While weighed down by these charges, Rolls Royce still increased its turnover up 5.3%, to £7.9 billion.

Rolls Royce announced on June 14, 2018, it would cut 4,600 jobs by 2020, mainly in the United Kingdom, in order to simplify its operations and save up to £400 million a year.

A way out for Trent 1000?

In early 2016, the launch customer of the Boeing 787, All Nippon Airways (ANA), detected unusual corrosion in blades of intermediate-pressure turbine (IPT), resulting in early wear and cracking on Trent 1000 Package C engines. 

Two years later, in June 2018, it was discovered that the Package B was affected too. This forced Rolls Royce to start a long campaign of inspections and replacement of defective parts. 

“We have made good progress on resolving the Trent 1000 compressor issue, though regretfully, customer disruption remains,” said Warren East, general manager. The cost of these defective engines, including compensations, will be around £1.6 billion.

Rolls Royce announced on June 11, 2018, that the durability issue already detected on its Trent 1000 Package C engines also affected “a small number of high life Package B engines”. 

In January 2019, early wear of the high-pressure turbine (HPT) blade of Trent 1000 TEN was also detected, prompting for more inspections. Rolls Royce expects costs to be “within the bounds of normal risk we manage on our programmes in any given year”.

Interviewed by BBC Radio, East said the group was getting ready for the Brexit, due to happen at the end of October. Rolls Royce has already spent £100 million, including increasing inventory, to meet the deadline. “We would obviously prefer a deal because that is the best way of providing certainty for business but we’ve always been prepared for a no-deal of some kind,” said East.

Rolls Royce is considering relocating the technical department in charge of approving its engines in Germany, to make sure it remains within the legislation of the EASA. The company fears that a hard Brexit may jeopardize the manufacturer’s influence within the European agency.