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MNCHEN (dpa-AFX) – The Munich-based engine manufacturer MTU (MTU Aero Engines) does not expect strong growth for a few years after the slump in sales during the Corona crisis. “We see the next few years as a phase of restart in which we use our technology leadership, innovative strength and flexibility to expand our good starting position in order to again participate disproportionately in the growth of the industry from 2024,” said CEO Reiner Winkler at an analyst event of the group on Thursday in Munich. After the corona low of 2020, the proceeds should rise again in 2021.
On the stock exchange, the news was acknowledged with a price slide. The MTU share fell in the afternoon by 4.12 percent to 193 euros and was by far the weakest value in the Dax (DAX 30). However, the share had risen sharply since the positive news about a first corona vaccine at the beginning of last week. Most recently, it was trading around a quarter cheaper than at the beginning of the year.
The statements of the management board about 2021 sounded rather positive. While MTU continues to expect sales to decline to 4.0 to 4.2 billion euros this year due to the corona pandemic and the slump in air traffic, the top management estimates that things should go better in 2021. Analysts, on the other hand, had expected a further decline to around 3.9 billion euros.
In the business with engine maintenance for passenger and cargo aircraft in particular, MTU expects an increase in sales of between 20 and almost 30 percent for the coming year. The Executive Board hopes that air traffic will pick up again and that the airlines will again have more engines overhauled by MTU. Executive board member Michael Schreygg is primarily relying on Airbus (Airbus SE (ex EADS)) – medium-haul jets of the A320 series and their new version, the A320neo – as well as on the cargo airlines, which are experiencing a boom in the Corona crisis and are sending their machines for maintenance.
In the lucrative spare parts business and in the military sector, the MTU management expects slight growth in 2021. In contrast, business with new engines for commercial aircraft is likely to stagnate at the 2020 level. “The reduced aircraft production rates are reflected in the engine production,” said board member Schreygg. For example, MTU expects sales in the commercial series business to stagnate in the coming year.
Despite the expected increases in several segments, MTU is likely to remain significantly behind the business figures of previous years in 2021 as well. In 2019, the group achieved sales of a good 4.6 billion euros. And before the corona pandemic plunged the aviation industry into what was probably the worst crisis in its history, the MTU management had aimed for a further increase in 2020. At the end of March, management withdrew these targets and came up with an initial new forecast in the summer.
The large aircraft manufacturers Boeing and Airbus had already significantly reduced their production due to the Corona crisis. Many airlines are currently barely able to use new machines due to the severe slump in air traffic. In contrast to the US group Boeing, however, the European manufacturer Airbus has hardly received any cancellations. When the interim results were presented at the end of October, the MTU management made a similarly positive statement. Most customers wanted their aircraft to be accepted a few months or quarters later, however, it said.
When it comes to short- and medium-haul jets, MTU is primarily in the business of the engines for the Airbus A320 and its new A320neo – the aircraft manufacturer’s bestsellers. In the industry, it is expected that air traffic on short and medium-haul routes will pick up again first. The business with long-haul flights is unlikely to recover until later. MTU is helping to build a drive for Boeing’s 787 “Dreamliner” large-space jet and the even larger new 777X. The group also supplies spare parts and maintains many older types of aircraft./stw/jkr/he