Pratt & Whitney Halted F-35 Engine Delivery Over Titanium | Bloomberg

By Tony Capaccio

United Technologies Corp. (UTX)’s Pratt & Whitney unit said it suspended delivery of engines for the F-35 jet, the Pentagon’s costliest weapons program, over concern that a supplier may have provided “suspect” titanium.

Delivery of engines was halted in May after an in-house inspection and testing process “raised questions about the origin” of the titanium, spokesman Matthew Bates said in an e-mailed statement. The company replaced all the suspect engine parts in its inventory for failing to meet specifications, but determined that the metal in 147 F-35 engines already delivered didn’t pose a flight-safety risk, he said.

Pratt & Whitney, the sole provider of engines for the F-35, has faced criticism from Pentagon officials for failing to reduce prices quickly enough and for lapses in quality. The engine accounts for $68.4 billion of the $398.6 billion projected cost of the F-35 being built by Lockheed Martin Corp. (LMT)

After the company’s internal review raised doubts about the titanium’s origin, Pratt & Whitney “immediately reported its concern” to the Justice Department, the Defense Criminal Investigative Service and the Air Force Office of Special Investigations, Bates said. The suspension affected 10 engines that probably would have been delivered by now and four more that are not yet under contract. The titanium is also used on some parts of commercial engines made by Pratt & Whitney Canada.

Frank Kendall, the Pentagon’s undersecretary for acquisition, has been informed of the issue by officials “who will continue to keep him updated on any implications for the F-35 program,” spokeswoman Maureen Schumann said in an e-mailed statement.

Halt Remains

The unit of Hartford, Connecticut-based United Technologies also issued an industrywide alert to contractors about the supplier. The halt in engine deliveries remains in place until the Pentagon determines what caused a June 23 engine fire in an F-35.

The hold on deliveries is one of 30 “potential problem notifications” that Pratt & Whitney voluntarily issued on engines or components since Oct. 1, according to the Pentagon program office. It said that 25 notifications were issued through April, including some that delayed the assembly of engines.

The warnings concerned items such as material certification for an oil-pump gasket, the quality process involving a heat shield for a bearing compartment, incorrect assembly of an actuator bearing and failure to provide heat treatment for a fuel-oil cooler part, the F-35 program office said in an e-mailed statement.

‘Poor Management’

The Defense Contract Management Agency wrote in a June internal assessment that Pratt & Whitney’s “continued poor management of suppliers is a primary driver for the increased potential problem notifications.”

The incidents “have resulted in delinquent deliveries of engines,” the agency said. “This trend will continue until the contractor improves its management of subcontractors and suppliers.”

Bates, the Pratt & Whitney spokesman, said “the vast majority” of problem notifications “are minor issues or no issues at all” and “do not have any impact on specifications or field performance” of engines.

Only four of the 30 notifications “required action in the field,” he said.

The Pentagon’s F-35 program office said in a statement that Pratt & Whitney’s “persistent problems stem from the supply chain” because 80 percent of the engine is produced by many different subcontractors.

New Requirements

“It has been about 30 years since PW has designed and started production of a new single-engine fighter engine” and “there are new critical safety item requirements for single-engine safety that have been applied to this engine,” it said.

Pratt & Whitney said in its statement that it’s no longer “accepting parts made from material provided by” the supplier of the titanium, A&P Alloys Inc. based in West Bridgewater, Massachusetts.

The supplier provided “some conflicting documentation” which “made P&W experts question the pedigree of specific material used in our engines,” the company said.

A&P Alloys “stands behind the quality of its products,” Tracy Miner, an attorney with Boston-based Demeo LLP representing the company, said in an e-mailed statement. “A&P has been supplying metals for use in Pratt & Whitney products for almost 50 years and this is the first time the quality of the products has ever been questioned.”

‘Blatantly Unfair’

“Unfortunately, despite requests, A&P has not been given access to the material to do its own testing, nor have results of any testing done by Pratt & Whitney been provided to A&P for analysis,” she said. “No ‘surveillance’ information has been provided by Pratt, either. It is blatantly unfair to destroy A&P’s business without allowing A&P access to the materials in question.”

Asked about the comments from A&P Alloys, Bates, the Pratt & Whitney spokesman, said in an e-mail that the supplier “had the material in its possession prior to delivery and sold it with certifications falsely representing the source and quality of the material. Whether A&P now has access to Pratt & Whitney’s recent test results is irrelevant to this issue.”

Pratt & Whitney isn’t asking the Pentagon to pay the cost associated with removal and replacement of “parts with the suspect titanium,” Bates said.

The contract management agency estimated the per-engine cost at as much as $50,000. Bates wouldn’t comment on the figure.

via Pratt & Whitney Halted F-35 Engine Delivery Over Titanium | Bloomberg.