Jet-engine makers are looking for titanium supplies outside Russia

Photo: Technicians build LEAP engines for jetliners at a General Electric (GE) factory in Lafayette, Indiana, U.S.. REUTERS/Alwyn Scott/File Photo

Engine makers for Boeing and Airbus jets are working to diversify sources of titanium away from Russia as the conflict in Ukraine threatens access to the metal needed to make critical plane equipment.

Russia’s VSMPO-Avisma is the main supplier for Safran, a French multinational with operations in King and Snohomish counties that buys nearly half its titanium from VSMPO-Avisma. As military tensions built over recent weeks, the company has bought titanium from distributors in Germany, he said on a conference call.

“We have been increasing our stocks of titanium since the start of the year,” Chief Executive Officer Olivier Andries said Thursday. “We have a few months ahead of us for motor parts and landing gear, so some time to accelerate to other sources.”

Rolls-Royce Holdings, with 20% of its titanium coming from Russia, has also been stockpiling and diversifying its sources, CEO Warren East said on a separate earnings call. The metal is widely used in engines, fasteners and other aircraft parts because of its light weight, strength and resistance to corrosion.

The possibility of sanctions or other interruptions in critical raw-material supplies came into sharp focus on Thursday after Russia mounted an attack on Ukraine following a troop build-up and fervent diplomatic efforts to avoid an invasion. Shortages could exacerbate existing supply-chain issues that threaten a production ramp-up for both major planemakers.

“As long as the geopolitical situation stays tame, no problem,” Boeing CEO Dave Calhoun said in a Jan. 26 conference call. “If it doesn’t, we’re protected for quite a while, but not forever.”

Boeing announced a new deal with VSMPO in November. Airbus said it sources titanium directly from the Russian company and through major suppliers, through programs that account for geopolitical risk.

“We are therefore protected in the short/medium term,” the European planemaker said in an email. “We are closely monitoring the situation with our suppliers.”

VSMPO’s role supplying nearly a quarter of global titanium poses a threat to aerospace supply chains, Jefferies analyst Sheila Kahyaoglu earlier this month. Howmet Aerospace Inc., which sources titanium from Japan, and Allegheny Technologies Inc., could serve as alternative suppliers, she wrote in a research note.

Safran’s CFM International venture with General Electric is the sole producer of engines for Boeing’s 737 MAX single-aisle jets and one of two providers for Airbus SE’s rival A320 series. London-based Rolls makes engines for larger twin-aisle aircraft.

“A blockade would certainly create tensions everywhere,” Andries said Thursday Feb. 24.

The concerns over supplies of titanium and other metals over coming months add to existing bottlenecks for raw materials and tightening labor markets that have plagued sectors from aeropace to automaking.

Raytheon’s Pratt & Whitney unit said Wednesday Feb. 23 that metal castings shortages will delay shipping roughly 70 jet engines to Airbus in the first quarter.

Parts shortages, abetted by worker absenteeism at U.S. sites tied to the omicron variant of coronavirus, have also caused Safran deliveries to slip. Raw materials like metals, resins and semiconductors are harder to come by, Andries said.

Suppliers are gearing up output with “a very complex situation to manage,” Airbus CEO Guillaume Faury said in Feb. 17 interview. He cited “access to raw materials being difficult and the prices very high, the price of energy very high, logistics around the world is a challenge and prices are very high.”

Fighter parts
In a bid to safeguard technology and supplies for future commercial and military jets, Safran along with Airbus and Tikehau Ace Capital this week agreed to buy alloy and forging company Aubert & Duval from France’s Eramet.

Outside of the U.S., Aubert & Duval is the only elaborator of special alloys able to withstand extreme temperatures that will be needed for a future European fighter jet.

“It’s highly strategic,” Andries said. “We needed to keep this strategic supplier not only afloat but performing.” seattletimes.com