Delta CEO sees engine repair delays as major industry constraint

Delta Air Lines Inc. Chief Executive Officer Ed Bastian said supply-chain chokepoints that developed in the wake of the pandemic remain an issue for the aviation industry, alongside extended times for engine repairs that are among factors restraining growth.

“The supply chain is not where it needs to be,” Bastian said in an interview Friday on Bloomberg Television’s Surveillance. “It’s significant. It’s not just Delta, it’s the industry.”

Repair times continue to take months rather than weeks, the CEO said. Manufacturers deep into the supply chain are still being affected by a less experienced workforce, and components needed to make parts aren’t as readily available and cost more.

“It’s a very complex issue,” Bastian said.

Work to repair a manufacturing defect in geared turbofan engines made by RTX Corp.’s Pratt & Whitney unit are forcing carriers to ground planes, and some expect the issue to continue another year into 2025. Those interruptions will outpace the effect of aircraft delivery delays by Boeing Co. that have also plagued the industry, Bastian said.

“The engines are going to be a bigger issue, particularly for us the geared turbofan,” Bastian said. “That’s slowing down a little bit the new deliveries we can take, but its more engines than it is planes. What it’s causing us to do is maintain the existing fleet we have a little bit longer, and that’s another cost to the business.”

Bastian said in March that he expects deliveries of the Boeing 737 Max 10 aircraft on order could be pushed out as late as 2027 instead off next year as previously expected.

Delta has ordered 100 of the planes, with options for 30 more.

Delta aims to increase capacity as much as 7% this year, which Bastian called “healthy growth,” alongside another year of record revenue.