Rolls-Royce plans to quadruple profits over the next five years by improving the efficiency of its jet engines and cutting costs. CEO Tufan Erginbilgic presented the strategy for the coming years.
Rolls-Royce wants to increase profits
Presenting the strategy that has been developed for almost a year, the CEO announced that by 2027 Rolls-Royce will increase his annual profit operation 3.5 billion dollarsThat is four times more than the company’s 2022 results and double this year’s forecast. Profitable growth should be driven increase in profit margin in the aviation department, which will increase to 15–17% z 2.5% from last year.
Erginbiligicformer actor BPwho took the position in January, announced that he will address the shortcomings in Rolls-Royceconsidering the sector wide body aircraft, aviation business, protection i energy systems.
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According to Reuters, the company plans to sell its business in the field an electric plane to obtain funds from the sale of assets unrelated to the core business. In addition, the company can enter the market again one-way flight in collaboration, using its technology UltraFan the new generation.
The most important factor in increasing profitability will be a significant improvement in margins in the department enginewhich power almost half of long-haul aircraft, including all models Airbus A330neo i A350 and some birds Boeing 787.
Today we announced the results of our strategic review and the steps we are taking to transform it into a high performing, competitive, stable and growing business. pic.twitter.com/nmH3BuqhrL
— Rolls-Royce (@RollsRoyce) November 28, 2023
The goal is production 350 engines per year
The edge goal would come close Rolls-Royce for competitors such as General Electricthe main rival in wide-body aircraft. Erginbiligic It said it will achieve this goal by increasing the “wing time” of its engines between maintenance, reducing production and repair costs, a new pricing strategy and dealing with low initial contracts.
According to Reuters, the company is planning a delivery 300-350 engines per year. This is the goal Erginbiligic it is considered to be “fully compliant” with the plans Airbus i Boeing. Stock Rolls-Roycewhich increased by 161% this year and reached the highest level in four years, after the announcement of a new strategy increased 6%. Agency analyst Partners, Nick Cunninghamhe said the new goals suggest readiness Rolls-Royce forgo revenue to improve profitability.
If so, this is a huge cultural shift from the traditional way Rolls-Royce to increase market share from previous decades – he said.
When asked if he is willing to give up market share, Flooding said the company 55% participate in delivery wide body aircraft last year and expects to maintain this level this year, with the expectation of increasing over the next five to ten years.
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