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Rolls-Royce Branches Out Amid Troubles

Rolls-Royce’s plan to acquire Siemens’ electric and hybrid-electric aerospace propulsion activities accelerates its electrification strategy.

Rolls-Royce’s decision to acquire the electric aircraft propulsion activities of Siemens, announced last week at the Paris Air Show, builds on several years of cooperation between the companies. The deal is expected to close by late 2019.

In 2017, Airbus, Rolls-Royce and Siemens began collaborating to fly a hybrid-electric engine on a BAE 146 test aircraft in 2020.

Rolls-Royce was responsible for the turbo-shaft engine, two megawatt generator and power electronics, while Siemens covered the two-megawatt electric motors and their power electronic control unit, as well as the inverter, DC/DC converter and power distribution system.

“We are at the dawn of the third era of aviation, which will bring a new class of quieter and cleaner air transport to the skies,” said Rob Watson, director-Rolls-Royce Electrical, at the signing of the deal to bring those activities in-house.

Watson reflects Rolls-Royce’s stated view that propulsion for “smaller” aircraft will switch to electric, while “larger” aircraft might gradually transfer to hybrid turbofan-electric solutions.

No one is yet defining the line between such smaller and larger aircraft, although at present all-electric solutions seem only viable for small air taxis capable of transporting a handful of passengers.

There is also the question of Rolls-Royce’s positioning for the future and the extent to which its latest announcement is a reaction to current travails.

The OEM’s Trent 1000 engine has been mired in durability problems for long enough to give any future customers serious doubts about ordering it over the rival GEnx. Potential future business has also been affected by Rolls-Royce’s decision to pull out of the race to power Boeing’s prospective “new midsize airplane.”

And while Rolls is the sole-source engine supplier for the Airbus A330neo and A350 aircraft, the latter aircraft platform has suffered setbacks this year from significant order cancellations.

There is always the aftermarket, of course, which Rolls-Royce dominates for its engines. Skeptics might wonder, however, if this business model would come under serious scrutiny from competition regulators at some point in the future.

Overall, then, now is the right time for Rolls-Royce to branch out.

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