Rolls-Royce shares slump as superjumbo oil leaks found
Published 08/11/2010 | 11:52
Manufacturing giant Rolls-Royce suffered another shares slump today after the chief executive of Qantas said oil leaks were discovered in three engines on board its superjumbo fleet.
Qantas grounded six giant A380s after an engine burst minutes into a flight from Singapore to Sydney last week, scattering debris over Indonesia's Batam island.
Qantas boss Alan Joyce said engineers found leaks beyond an acceptable level in three engines, built by Rolls-Royce, on separate A380s.
Rolls-Royce, which is working with Qantas on the investigation, has seen its market value fall more than £1.5bn (€1.7bn) since the incident. Shares shed 4pc or 23p to 567.3p.
Singapore Airlines, which also flies the superjumbo aircraft, said today that its inspections had found no problems with the Rolls-Royce Trent 900 engines.
Qantas and Rolls-Royce engineers carried out eight hours of extensive checks on each engine over the weekend.
Speaking earlier today, Mr Joyce told a press conference: "The oil leaks were beyond normal tolerances. So Rolls-Royce and our engineers have looked at what we have gathered as an accepted level and they have passed that threshold."
He went on: "All of these engines are new engines on a new aircraft type. The engines are not performing to the parameters that you would expect with this."
Mr Joyce said all of the airline's A380s would be grounded for at least an additional 72 hours.
Mr Joyce added: "We are not going to take any risks whatsoever. We want to make sure we have a 100pc safe operation."
The Australian Transport Safety Bureau, which is leading an international investigation into the blow-out on the A380, appealed for help from residents of Indonesia's Batam island to find a missing piece of a turbine disc.
Debris was scattered over the island last Thursday when one of the A380's four engines failed minutes into a flight to Sydney, with 466 people on board. The engine was quickly shut down and the plane returned to Singapore and safely made an emergency landing.
Qantas passengers stranded by the grounding of the A380s are expected to be flown to their destinations within 24 hours, Mr Joyce said. The airline is adding flights from London and Los Angeles to help clear the backlog.
Passengers on board the flight described seeing flames pouring from one of the engines as it made its landing. Images taken of the jet after the emergency landing revealed that one of its giant engines had been badly damaged.