Beleaguered Indian airline company Kingfisher Airlines Ltd.
recently disclosed that it has filed a lawsuit against
engine-maker International Aero Engines (IAE) to seek financial
compensation worth $236 million as damages for allegedly
supplying defective engines.
IAE is a consortium of specialized global engine-makers including
Pratt & Whitney, an operating unit of diversified business
United Technologies Corp.
), the Japanese Aero Engine Corporation (JAEC), and the German
MTU Aero Engines GmbH. It manufactures the V2500 engines that are
used in the A320 aircraft. IAE's aftermarket business includes
various engine overhaul centers with over $1.5 billion in sales.
The lawsuit alleged that engines supplied to Kingfisher by IAE
were defective in design and manufacturing and was one of the
primary reasons for grounding 14 Airbus A320 family aircraft,
which ultimately led to high operating loss for the grounded
Although IAE spokesperson did not comment on this issue, the
litigation could impair the brand image of the company. The
damage-control exercise is likely to dent a hole in the
credibility of the assembly-line manufacturing units and United
Technologies would certainly want to avoid any such instances in
Based in Hartford, Conn., United Technologies provides high-end
technology products and services to the building systems and
aerospace industries worldwide. The company serves various end
markets such as aerospace, defense and commercial construction.
The business diversification allows the company to remain
profitable amid tough economic times.
United Technologies' operations are primarily classified into two
principal businesses: commercial and aerospace. Under its
commercial business, the company has Otis and the UTC Climate
Controls & Security division, which combined the former
Carrier and UTC Fire & Security divisions. The aerospace
business of the company consists of Sikorsky aircraft and the UTC
Propulsion & Aerospace Systems, which include UTC Aerospace
Systems and Pratt & Whitney divisions. Concurrently, United
Technologies presently has five principal business segments:
Otis; UTC Climate, Controls & Security; Pratt & Whitney;
UTC Aerospace Systems; and Sikorsky.
United Technologies currently has a Zacks Rank #3 (Hold). Other
companies in the industry that are worth mentioning include
Federal Signal Corp.
), both having a Zacks Rank #2 (Buy), while
Hutchison Whampoa Ltd
) holds a Zacks Rank #1 (Strong Buy).
FED SIGNAL CP (FSS): Free Stock Analysis
HUTCHINSON WHAM (HUWHY): Get Free Report
ITT CORP (ITT): Free Stock Analysis Report
UTD TECHS CORP (UTX): Free Stock Analysis
To read this article on Zacks.com click here.