Pratt & Whitney and China Eastern Airlines Form CFM56 Engine Overhaul Joint Venture

Shanghai (PRATT & WHITNEY) - Pratt & Whitney, a United Technologies Corp. company (NYSE: UTX), and China Eastern Airlines signed a joint venture agreement today in Shanghai to create a CFM56® engine overhaul facility in Shanghai.

As part of the deal, China Eastern Airlines (CEA) awarded Pratt & Whitney a 15-year maintenance service agreement to maintain the airline’s fleet of CFM56® engines. Financial terms of the agreement were not disclosed.

The new facility will overhaul CFM56-3, -5B and –7 engines. The facility’s in-depth repair capabilities, 10-meter test cell with capability of up to 75,000 pounds of thrust and state-of-the art information technology system will provide maintenance, repair and overhaul (MRO) services to airline customers in China and the Asia Pacific region starting in 2008. Construction is expected to begin in the first half of 2007.

Pratt & Whitney has the best cutting edge technology and advanced repair capability in engine MRO,” Cao Jianxiong, vice president of China Eastern Aviation Group Company and president of China Eastern Airlines, said at the signing ceremony. “We are pleased to take this next, significant step with our MRO partner, Pratt & Whitney, and are confident we will build Pratt & Whitney Shanghai Aircraft Engine Maintenance Company Ltd. into the best CFM56® engine overhaul center in the world.”

“Our partnership with China Eastern Airlines, the largest CFM56® engine operator in the Asia Pacific region, strengthens Pratt & Whitney’s position as a unique OEMROTM provider," said Steve Finger, Pratt & Whitney president. “Pratt & Whitney is an engine Original Equipment Manufacturer (OEM) that provides overhaul and repair services to the entire MRO market, including Pratt & Whitney engines and others. This joint venture will provide CEA and other Asia Pacific airlines with an excellent quality and cost effective alternative for their CFM56® engine overhaul and repair needs."

The joint venture plans to induct the first engine in 2008. Once fully operational, the center will overhaul between 200-300 engines per year and employ approximately 800 people. Extensive on-site repair capability will reduce engine overhaul costs and turn around time.

“We are thrilled to become partners with such a recognized, quality minded company as China Eastern Airlines,” said Jim Keenan, senior vice president and general manager, Pratt & Whitney Global Service Partners. “This initiative supports Pratt & Whitney Global Service Partners’ strategy to expand our worldwide network and become the Number One independent supplier of CFM56® engine MRO services in the industry.

“Bringing this capability to the growing, vibrant city of Shanghai is a great source of pride for us,” Keenan said. “It’s clear to me that the future is very bright for China Eastern Airlines, and very bright for our new joint venture in Shanghai. We look forward to many years of successful partnership.”

China Eastern Airlines Co., Ltd., was established in June 1988 and it has maintained speedy and healthy growth in the past 18 years. It was successfully transformed into a shareholding company in 1997 and listed in New York, Hong Kong and Shanghai stock exchanges. Currently it has 200 Boeing and Airbus aircraft with an average age of 6.56 years, and the fleet is the youngest in the world. China Eastern operates more than 420 air routes including more than 80 international routes, forming a hub and spoke network centering on Shanghai, radiating across the whole country and linking to Southeast Asia, Japan, South Korea, Hong Kong, Europe, North America and Australia. It has code sharing relations with Chinese and foreign airlines on many domestic and international routes, providing convenient air travels for Chinese and foreign passengers.

Global Service Partners, Pratt & Whitney’s engine services business, is an industry leader in customer solutions and service excellence. It has more than 500 aviation customers served by a worldwide network of 24 overhaul and repair facilities capable of servicing all Pratt & Whitney engines, as well as V2500 and CFM56® engines. In addition to overhaul and repair services, customers count on Pratt & Whitney Global Service Partners to provide on-wing repair services, advanced engine monitoring and diagnostics, competitive engine lease programs and custom engine service programs.

Pratt & Whitney is a world leader in the design, manufacture and service of aircraft engines, space propulsion systems and industrial gas turbines. United Technologies, based in Hartford, Conn., is a diversified company providing high technology products and services to the global aerospace and commercial building industries.

Pratt & Whitney is a CAPA Member. For more information on the Centre for Asia Pacific Aviation's membership service, please click the icon below. capagold.gif capaplatinum.gif

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