Issues with Rolls-Royce Holdings PLC's (LSE:RR.) Trent 7000 engine "could become an issue" said Citigroup after an aerospace magazine ran an article about its reliability being "under the spotlight".
Analysts at Citi said the commentary in the Leeham News article appears to focus on time-on-wing, "which is durability", ie how long the engine lasts between overhauls, versus reliability, whether it breaks down unexpectedly.
Durability has clearly been an issue in the past, City noted, as RR introduced a durability enhancement package in August 2022, explicitly targeting blade life, with a further 30% time-on-wing enhancement currently in process.
"Clearly this is not desirable, but equally it is known by Rolls-Royce and we expect it to be within their guidance," the analysts said.
This "could become an issue", they added, if the commercial terms given in the long-term service agreements assume engineering gains that do not materialise but "we do not believe this to be the case".
It was also noted that the Trent 7000 is only 6-7% of the entire RR fleet.