Airbus, Rolls-Royce near $20B Turkish Airlines parts deal - Bloomberg

According to a report by Bloomberg on March 16, 2023, European plane manufacturer Airbus SE and engine maker Rolls-Royce Holdings Plc are in advanced talks with Turkish Airlines to sell a combined $18 billion to $20 billion worth of aircraft parts and services over the next decade. This potential deal would be one of the largest ever for both companies and would significantly boost their relationships with Turkey's flagship carrier.

The agreement would cover a wide range of services, including spare parts, maintenance, and engineering support for Turkish Airlines' fleet of more than 300 aircraft. The majority of these planes are made by Airbus, with some being Boeing models. The deal would reportedly last for ten years and could potentially be extended.

The negotiations come as Turkish Airlines continues to expand its fleet and routes, with plans to add more than 100 new aircraft over the next five years. The airline currently operates flights to over 315 destinations in more than 120 countries.

For Airbus, this deal would further strengthen its partnership with Turkish Airlines, which is one of its largest customers in Europe and the Middle East. The company has delivered over 350 aircraft to the airline since 1983 and currently has over 150 more on order.

Rolls-Royce, which provides engines for a significant portion of Turkish Airlines' fleet, including its A330 and A340 long-haul jets, stands to benefit from the potential agreement as well. The company has been working to improve its relationship with Turkish Airlines after a dispute over engine maintenance costs in 2019.

The potential deal comes at a time when both Airbus and Rolls-Royce are facing challenges in their respective industries. Airbus is dealing with production delays and quality issues with its new A321XLR and A350 jetliners, while Rolls-Royce is grappling with the financial fallout from the grounding of Boeing's 737 Max jets, which use its engines.

Despite these challenges, both companies see significant potential in the Turkish market and are eager to secure a long-term partnership with Turkish Airlines. The potential deal would not only provide a significant revenue boost but would also help to strengthen their positions in the competitive aviation industry.

However, it is important to note that the negotiations are ongoing and a final agreement has not yet been reached. The financial details and specific terms of the potential deal have not been disclosed, and there is always a risk that the negotiations could fall through or be delayed. Nonetheless, if successful, this agreement would be a major win for both Airbus and Rolls-Royce and would further solidify their relationships with Turkish Airlines.