General Electric Turns to Airbus Because of Boeing's Mess

Author:

M. Corey Goldman

Publish date:

Feb 19, 2020

Video Duration:

2:32

One airplane maker’s misery is another’s potential fortune.

So it could well be, not just for Airbus SE, but also for General Electric (GE) - Get General Electric Company Report, which has reportedly pivoted to Airbus as the jet engine maker's other big customer, Boeing (BA) - Get Boeing Company Report, continues to face headwinds surrounding its grounded 737 MAX aircraft.

GE is reportedly in talks with Airbus to design and sell an engine variant for Airbus's latest wide-body, called the A330neo. The discussions come in the wake of Boeing's decision to cut back production of that plane's rival 787 Dreamliner.

GE’s pivot to pitching Boeing-rival Airbus on new engines comes as supply lines within the global aviation industry continue to regroup and re-form, largely due to the prolonged grounding of Boeing's 737 MAX, which has been on the tarmac for close to a year after two deadly crashes caused in part by glitches in its flight-control systems.

Meantime, Boeing is facing additional scrutiny after reports of “foreign object debris” including tools and rags left in the fuel tanks of several newly built but undelivered 737 MAX aircraft raised additional concerns about quality-control processes - and the plane’s re-certification.

The company plans to inspect all undelivered aircraft, and has noted that the issue will not impact the grounded jet's return to service, which Boeing still expects to be mid-year.

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