Rolls-Royce problem in Trent engines used for Boeing jets spreads

Rolls-Royce has been hit by a problem with a compressor in the Trent 1000 package C engine, similar to one above, that is not lasting as long as expected, grounding planes, forcing inspections and angering airline clients. (Reuters)
Updated 13 June 2018

Rolls-Royce problem in Trent engines used for Boeing jets spreads

LONDON: Britain’s Rolls-Royce said a costly compressor problem that had grounded Boeing planes had now been found in a different type of engine, compounding pressures on a group that is due to cut more than 4,000 jobs this week.
Britain’s best-known engineering company has been hit by a problem with a compressor in the Trent 1000 package C engine that is not lasting as long as expected, grounding planes, forcing inspections and angering airline clients.
The engine powers Boeing’s 787 Dreamliner jet.
On Monday it said it had now found the same issue on a “small number of high life Package B engines,” requiring a one-off inspection of the B fleet and sending its shares down 1 percent.
The news, which will not affect Rolls’ full-year free cash flow target, comes as the group embarks on the latest stage of a major restructuring program under Chief Executive Warren East that is designed to boost profitability.
On Friday the group will host a capital markets day where, according to a person familiar with the situation, it will announce more than 4,000 job cuts, mostly in Britain and affecting support and management roles.
The group, which employs 50,000 people in 50 countries, is also expected to set out how it will make a return on the investment made in recent years and the expected drivers of cash flow beyond its medium-term horizon.
The news about the compressor issue will not help however as Rolls has been fighting to show it has a lid on a problem which has forced airline customers to lease alternative planes to fly in the busy summer holiday period.
The existing package C issue had led to about 30 of the affected aircraft being grounded at any one time for checks. They were flown by airlines including British Airways, Virgin Atlantic and Air New Zealand.
Air New Zealand said earlier this month it would lease two Boeing 777s to cover for 787-9s that are affected by the Rolls engine issue.
Airlines that use the package C engine tend to also take the package B engine. According to Rolls some 380 package C engines are in service while there are 166 package B engines in service.
Rolls said that while this new problem would incur some additional cost, it did not expect it to affect its free cash flow guidance for 2018.
Analysts welcomed the fact the group did not revise the target and noted the comment that the package B issue only affected a “small number” of engines.


Saudi consumers give online retailer AliExpress boost in Middle East market

Updated 13 November 2019

Saudi consumers give online retailer AliExpress boost in Middle East market

  • AliExpress currently delivers to more than 200 countries and can be used in 18 languages
  • Around 60 percent of the consumers are below the age of 35, with 51 percent being female

DUBAI: Due to the increasing amount of purchases from the region, the Chinese e-commerce AliExpress has started offering several new services.
The growing demand came specifically from Saudi Arabia and the UAE, where the retailer started offering consolidation of orders for cheaper delivery and cash on delivery as a payment option.
These services were tailored to consumers from the region, as the company knew “cash on delivery is very popular in Saudi and UAE,” according to AliExpress’s Middle East head, Matt Zhang.
The retailer, which is under the Chinese Alibaba multinational conglomerate, is also trying to expand its provided local services.
“We have an overseas warehouse in Dubai. We are trying to open a warehouse in Saudi. We are in the process of all the legal and facility planning,” Zhang said.
Sellers will have the chance to use this facility, which is usually stocked with high-demand items, to decrease delivery times.
They also use the local delivery company Aramex in Saudi Arabia and the UAE to decrease the amount of time required for orders to reach consumers.
“Cainiao works with local partners” to enhance the buying experience, Zhang added. Cainiao is a technological company and the logistics arm of Alibaba group, providing the various businesses under the conglomerate with a variety of solutions locally and globally.
All of these additions follow AliExpress’s main strategy to expand in the region, which is to provide “a good selection, more competitive price and good service,” Zhang said.
The e-commerce company has been working with a marketing agency for the region as well, as they believe they need “more local insights,” he added.
For consumers in Saudi Arabia, their top three categories for shopping are consumer electronics, home and garden, and phones and accessories.
One of the reasons why consumers choose to buy such items from AliExpress is the value for money they get in exchange.
Buyers and sellers are now able to skip the tedious process of export and import through warehouses and distribution centers, which shortens the whole value chain and provides the same goods for a smaller amount of money.
Another interesting defining factor of consumer behavior in Saudi Arabia is the tendency to explore more options under each category compared to other countries.
The top three categories make up less than 40 percent of the ordered products, leaving the remaining more than 60 percent scattered over a long list of sub-categories.
On top of AliExpress, Alibaba is penetrating the regional market in other ways too.
If you have noticed the recent 11.11 sales and offers, they have been inspired by a decade-long shopping festival in China.
Although 11.11 is just starting to bloom in the region, it is a long-established event in China featuring a variety of entertainment and shopping events.
The famous US singer, Taylor Swift, performed at Shanghai’s Mercedes-Benz Arena during this year’s gala event for the shopping festival.
Several local retailers offered discounted items, ranging from baby care products, to groceries, to electronics and clothes.
At the end of the 24-hour shopping festival, Alibaba’s gross merchandise value (GMV) surpassed $38 billion, according to the company.
Alibaba reported that over 215 leading international brands, like Lancome and Shiseido, debuted one million new products, with over 240 11.11 themed items, during the 2019 festival.
The conglomerate is currently focusing on new retail in China, or as they have explained, an offline and online shopping experience. Tmall customers can view products online, and either buy them through delivery of find the nearest outlet to check the items in real life.
They are also undertaking new ventures in the country, such as the Flyzoo hotel in Hangzhou, which is fully automated and is operated by robots.
AliExpress currently delivers to more than 200 countries and can be used in 18 languages. Around 60 percent of the consumers are below the age of 35, with 51 percent being female.
Currently, the countries with the highest GMV are Russia, Spain, France, Poland and Brazil.
The retailer is also working on offering more international businesses to operate on their website and sell products. The service has already been launched in Russia and Turkey.