A new engine technology developed by United Technologies Corp.'s Pratt & Whitney unit has been selected by Mitsubishi Heavy Industries Ltd. for use in its Mitsubishi Regional Jet, the first Japanese-manufactured passenger aircraft in 40 years. The technology, called the Geared Turbofan engine, is designed to boost fuel efficiency and reduce noise. It has been in production for more than 20 years. Progress on the technology has been monitored by Boeing and Airbus, which are considering designing new single-aisle models to replace the Boeing 737 and the Airbus A320. "We are very much aware of the technology and applaud Pratt's efforts to continue the research and development in this area," said an Airbus spokesman. Mitsubishi hopes the Regional, which will hold 70 to 90 passengers, will be airborne by 2012. Mitsubishi Heavy Industries President Kazuo Tsukuda said each plane will cost ¥3-4 billion ($26-34 million), a relatively low range. The Geared Turbofan has a gearbox separating the main fan blade from internal engine parts, allowing them to operate at different speeds. This burns about 12% less fuel and cuts noise by 50%. Mitsubishi Heavy's endorsement is "a considerable boost," Bank of America aerospace analyst Robert Stallard wrote in a note.
Sources: Press release, Wall Street Journal
Commentary: Stocks With the Most Analyst Love • The Long Case for United Technologies
Stocks/ETFs to watch: UTX. Competitors: BA, GE, ERJ. ETFs: ITA, PPA, XLI
Earnings call transcript: United Technologies Q2 2007
Seeking Alpha's news briefs are combined into a pre-market summary called Wall Street Breakfast. Get Wall Street Breakfast by email -- it's free and takes only seconds to sign up.