Rohr, GE in Joint Venture to Make Jet-Engine Parts
Rohr Industries of Chula Vista and General Electric have formed a joint venture to produce certain jet-engine components made of composites, the non-metallic materials resembling plastics that are often as strong as metals but considerably lighter.
The $20-million joint venture, called Composite Technology Engine Co., will be based in San Marcos, Tex. and will begin operation later this year. The venture could employ up to 50 by year’s end and as many as 170 by 1994.
Rohr manufactures a variety of aeronautics components, including jet engine nacelles, or pods, for a list of customers including GE. With Rolls-Royce and Pratt & Whitney, GE is one of the world’s largest jet-engine manufacturers.
Exploit New Business
Both Rohr and GE use composites to an increasing degree in their products and hope to exploit new markets by joining. Neither company would project sales for the operation. Fewer than a dozen Rohr and GE employees will be moved to San Marcos.
John Simon, an analyst with Seidler Amdec Securities in Los Angeles, described the joint venture as a developmental “pilot operation . . . . It’s not a big deal now but could become one in the future.”
Over the past year, General Electric has been one of several manufacturers rumored to be mulling a takeover bid for Rohr. Those rumors sent Rohr stock up sharply earlier this month. Rohr closed up $.375, at $34.375 a share, in Thursday trading.
The joint venture does not restrict the companies from independently selling composite products that they already make, said CTEC President James W. Davidson, a former Rohr engine components director who has been named to head the joint venture.
Fan Cases for F-18 Jets
Among the products the joint venture will make are jet engine fan cases for the F-18 jet fighter. The joint venture will try to develop several more products. To house the operation, CTEC will build a 125,000-square-foot plant on a 20-acre site 40 miles north of San Antonio.
Rohr officials said CTEC is good for Rohr because, in GE, it will provide an “assured near-term market” as well as accelerate its entry into products, mainly engine parts, that it has been trying to develop.
So far, Rohr’s use of composites has been restricted mainly to jet engine nacelles or casings, Davidson said. GE is already making some of the CTEC products at its Albuquerque, N.M., plant.
CTEC will be a “stand-alone” company that will not disclose certain market and technical information to its two parent firms, said Rick Kennedy, a spokesman with General Electric’s Aircraft Engine unit in Cincinnati. As such, the joint venture will be free to sell its products to GE competitors Rolls-Royce, Pratt & Whitney and others, he said.
Another advantage for GE is that the joint venture will relieve it of having to expand its 712,000-square-foot plant in Albuquerque, which employs 1,700, Kennedy said.
