MTU Aero Engines

MTU Aero Engines AG

Company type	Public limited company
ISIN	DE000A0D9PT0
Industry	Mechanical engineering
Founded	1934
Key people	Lars Wagner, Chief Executive Officer Michael Schreyögg Peter Kameritsch Silke Maurer Gordon Riske, Chairman of the supervisory board
Number of employees	11,273 (Dec 31, 2022)
Website	www.mtu.de

The MTU Aero Engines AG, headquartered in Munich, Germany, is a publicly listed company specializing in the manufacturing and maintenance of jet engines for both civilian and military aviation.

History

MTU Aero Engines AG was founded in 1934 as BMW Flugmotorenbau GmbH, spun off directly from BMW AG. This move was partly influenced by the German Ministry of Aviation, which aimed to conceal the rearmament efforts of the Luftwaffe and the corresponding demand for BMW engines in financial statements. Additionally, the company's management sought to minimize risks associated with a business solely focused on rearmament. In 1936, BMW secretly built an aircraft engine factory in Allach near Munich, which is now the site of MTU Aero Engines. By 1940, the plant expanded to mass-produce BMW 801 aircraft engines, used in planes like the Focke-Wulf Fw 190 fighter and the Dornier Do 217 bomber. During World War II, a large number of forced laborers were used in production; by 1943, they made up the majority of the workforce. In February 1943, the München-Allach concentration camp sub-camp was built next to the BMW plant, where prisoners, mainly Jewish, were forced to work in production or build bunkers to protect the facilities from air raids.

In April 1945, US troops occupied the plant and used it as a repair shop for army vehicles and artillery, saving it from complete dismantling. After the ban on engine production was lifted, BMW re-entered the aircraft engine development and production business in 1957 with BMW Triebwerkbau GmbH.

In 1960, MAN acquired a 50% stake in BMW Triebwerkbau GmbH, and by 1965, it took over the remaining shares. BMW Triebwerkbau GmbH then merged with MAN Turbomotoren GmbH to form MAN Turbo GmbH. In 1969, MTU (Motoren- und Turbinen-Union) was established as a joint venture between MAN and Daimler-Benz. This combined their respective internal combustion engine (diesel engines and turbines) activities beyond heavy truck engines, including Maybach engines. The immediate reason was a change in legislation for heavy trucks, requiring the development of new engines. These new V-engines (Mercedes-Benz OM400 and MAN D253x/D2542) shared a common engine block, with only pistons and cylinder heads developed independently by both companies. Initially, activities were concentrated at one location each (aircraft engines in Munich, piston engines and stationary gas turbines in Friedrichshafen). Later, the Friedrichshafen site was converted into an independent subsidiary, MTU Friedrichshafen (now Rolls-Royce Power Systems).

In 1985, the then Daimler-Benz AG acquired the remaining 50% shares from MAN, making MTU a part of DASA. This aligned with Edzard Reuter's strategy to diversify the group. However, since MTU Aero Engines is an engine manufacturer and not an aircraft or spacecraft manufacturer, it was not integrated into the new European aerospace company when DASA merged with other aircraft and spacecraft producers to form EADS in 2000. MTU therefore remained a subsidiary of the DaimlerChrysler Group.

Edzard Reuter's successor, Jürgen Schrempp, re-focused the group as a pure automotive producer, leaving no place for MTU's aerospace division within DaimlerChrysler. Consequently, in 2003, DaimlerChrysler sold this part of the original MTU, as MTU Aero Engines, to the US private equity investor group KKR. KKR then took MTU public on June 6, 2005. The stock was included in the MDAX effective September 19, 2005. KKR completely divested its shares in January 2006, meaning 100% of the shares are now in free float.

In April 2013, the supervisory board appointed Reiner Winkler, previously the CFO, as CEO of MTU Aero Engines AG, effective January 1, 2014, as Egon Behle did not seek a contract extension. At the end of 2022, Reiner Winkler concluded his mandate for personal reasons with the agreement of the supervisory board. On January 1, 2023, Lars Wagner, previously MTU's Chief Technology Officer, took over as CEO.

After a 750% increase in share price over ten years, MTU was promoted from the MDAX to the DAX, the index of the 30 most valuable listed companies, effective September 23, 2019.

Company Structure and Business Segments

MTU Aero Engines develops, manufactures, and supports civil and military aircraft engines across various thrust and power classes, as well as stationary industrial gas turbines. In addition to high-pressure compressors and low-pressure turbines, it develops and manufactures other engine components such as turbine intermediate cases, turbine exhaust cases, and brush seals.

Today, one-third of the world's civilian aircraft fly with MTU technology. MTU is a system partner for almost all German Bundeswehr aircraft engines. Through its holdings and subsidiaries (e.g., MTU Aero Engines North America), MTU is closely linked with major manufacturers like Pratt & Whitney, General Electric, Rolls-Royce, Safran Aircraft Engines, and GKN Aerospace.

In 1979, MTU entered the civilian engine maintenance market on a large scale with the establishment of its first maintenance facility, MTU Maintenance Hannover. The company operates in the maintenance market through MTU Maintenance and local sites in Langenhagen (Hannover), Ludwigsfelde (Berlin), Vancouver (Canada), Zhuhai (China), Nova Pazova (Serbia), Dallas (USA), São Paulo (Brazil), and Perth (Australia).

The Hannover site is the core of the maintenance group, repairing and overhauling medium and large civil engines. These include the GE CF6-80C2 and GE90 engines, the Pratt & Whitney PW2000, the Pratt & Whitney PW1100G-JM from the Pratt & Whitney GTF™ engine family, the CFM International CFM56-7 and LEAP from General Electric/Snecma, and the IAE V2500.

MTU Maintenance Berlin-Brandenburg, located in Ludwigsfelde, specializes in aircraft engines in the low to medium thrust and power range, as well as industrial gas turbines. This site services Pratt & Whitney Canada engines – PT6A, PW200, PW300, PW500, and PW800 – as well as GE's CF34 family. It also serves as the European base for servicing industrial gas turbines.

In total, the company operates 18 locations worldwide. The civil engine business currently accounts for about 25% of sales, civil maintenance for about 66%, and military business for 9%.

In 2002, the company received the German Innovation Award. MTU Aero Engines also won the German Innovation Award again in 2013 in the large companies category, this time for developing the high-speed low-pressure turbine of the Pratt & Whitney PW1000G engine.

Participations

In the engine industry, collaborations for engine manufacturing are common to distribute development and financial burdens across multiple partners. Even larger companies could face difficulties if an engine doesn't gain the expected market acceptance. The high development costs are due to the complexity of engines and the relatively long time from development start to final delivery. Also, individual engine types are no longer derived from previous military engines to a certain extent, which was often the case, especially during the Cold War.

MTU Aero Engines participates in various consortia that jointly develop and manufacture engines. In the civil sector, this includes International Aero Engines, the manufacturer of the V2500 engine, used in the McDonnell Douglas MD-90 and the Airbus A320 family. The V2500 engines used on A320 family aircraft are available in thrust versions from 110 to 150 kN (versions A1 and A5/A5Select). The V2500-D5 derivative was the exclusive engine for the McDonnell Douglas MD-90 until the aircraft's production ceased in 2000.

A similarly structured consortium, the Engine Alliance, provides the GP7000, one of two available engines for the Airbus A380. Approximately half of the 200 ordered large aircraft of this type are currently powered by this engine. The engine is largely based on the GE90 and the Pratt & Whitney PW4000. The Engine Alliance is a joint venture between General Electric and Pratt & Whitney, supplemented by several additional partners.

Civil Projects

Additionally, the company is a partner in numerous other engine projects, including:

• Pratt & Whitney PW4000: Manufactured by US engine maker Pratt & Whitney. Depending on the version, the engine has a thrust range of 84,600 to 98,000 pounds, making it one of the most powerful engines ever built. It was the first engine to receive 180-minute ETOPS approval from the start. It is used on the Boeing 777, as well as various Airbus models such as the A330 and A310. MTU Aero Engines developed the turbine exhaust case and the low-pressure turbine and is involved in its production. MTU's total share in this engine is 12.5%.
• Pratt & Whitney PW6000: This engine was developed in cooperation with Pratt & Whitney since 1998 and is an engine variant for the Airbus A318. For the first time in its history, MTU manufactured the complete high-pressure compressor and the complete low-pressure turbine for a civil engine. The PW6000, which is no longer manufactured, was final assembled at MTU's Langenhagen site.
• Pratt & Whitney PW2000: The PW2000 is one of the few engines used in both civil (Boeing 757) and military (Boeing C-17) applications. Since 1979, MTU has developed the low-pressure turbine and the turbine exhaust case. The company is also involved in the production of the low-pressure turbine, bringing MTU's total program share to 21.2%.
• Pratt & Whitney GTF™ Engine Family (PW1000G): This engine features a geared fan, allowing the fan and low-pressure turbine to operate at optimal speeds. The A320neo is offered with a variant of this engine. MTU has a program share of up to 18% in the GTF, depending on the application, and is responsible for the development and manufacturing of the high-speed low-pressure turbine and the first four high-pressure compressor stages. Nickel blisks are also manufactured for other high-pressure compressor components.
• Pratt & Whitney Canada PW800: A two-shaft turbofan engine for mid-size business jets, thrust class 10,000 to 20,000 pounds. MTU holds a 15% stake in this engine, which includes the development and manufacturing of both the high-pressure compressor and the low-pressure turbine.
• Pratt & Whitney Canada PW500 and Pratt & Whitney Canada PW300: Both are two-shaft turbofan engines for mid-size business jets. MTU has a 25% stake in the PW305, PW306, and PW307 models, as well as the PW530 and PW545 models. This includes the development and manufacturing of the low-pressure turbine, casing, and mixer.
• General Electric GEnx: The GEnx is the next-generation engine family from the US manufacturer. It is based on the General Electric GE90 and is the successor to the General Electric CF6, the best-selling engine type for wide-body aircraft. MTU holds a 6.5% share in the GEnx program and is responsible for the development, manufacturing, and assembly of the turbine intermediate case.
• General Electric GE9X: The GE9X is the successor to the General Electric GE90 and the exclusive engine for the Boeing 777X. MTU develops and manufactures the turbine intermediate case, which accounts for a 4% program share. As of February 2023, market entry is planned for 2025. As of February 2023, there were 353 firm orders for the 777X.
• General Electric CF6: The CF6 is a two-shaft turbofan engine for medium and long-haul aircraft from Airbus and Boeing, including the Airbus A300 and A330, as well as the Boeing 747 and Boeing 767. MTU has been involved in the program since 1972 and manufactures parts of the high-pressure turbine and compressor.
• Pratt & Whitney JT8D: With a maximum takeoff thrust of 96.5 kN, the JT8D is used in the McDonnell Douglas MD-80 aircraft family. MTU is involved in the program with a 12.5% share and is responsible for components such as the low-pressure turbine blades.

Military Projects

MTR GmbH: Produces the MTR390 engine for the Eurocopter Tiger attack helicopter.

Europrop International: Produces the EPI TP400 engine for the Airbus A400M.

Turbo Union: Produced the RB199 engine for the Panavia Tornado.

Eurojet: Produces the EJ200 engine for the Eurofighter Typhoon.

In cooperation with GE Aviation, MTU is a risk-and-revenue-sharing partner in the F414, F110, and T408 programs. Furthermore, MTU develops, manufactures, and supports the Next European Fighter Engine (NEFE), which is the core of the next-generation fighter jet within the European "Future Combat Air System" (FCAS), planned to be available from 2040.