Honeywell lands $23 billion business jet engine order from Embraer

Honeywell International Inc won its biggest business jet engine order ever securing a $23 billion contract from Empresa Brasileira de Aeronautica SA (Embraer) for two new models that will take to the skies over the next decade. It beat two longstanding rivals, Rolls Royce and Pratt & Whitney, for the contract.

The contract is the Brazilian company's first engine order with Honeywell and includes repair parts and services. Honeywell, the world's largest maker of cockpit displays, has won aircraft-control contracts with Embraer in the past.

Embraer had said last month that it would spend $750 million to develop two business jets, the MSJ and MSL models. These jets, which will seat seven to 12 people, are expected to begin flying in the second half of 2012.

Meanwhile, Embraer also announced that Rockwell Collins would supply the avionics for the two jets. It did not disclose the value of the contract.

Embraer now becomes the second business jet maker to use Honeywell's engine, which features best-in-class fuel efficiency and a near perfect mechanical reliability rating. According to Honeywell, the engine has a 99.95 per cent reliability which is very important as the planes in this class are being flown 1,000 hours a year, up from 400 hours, the historical average.

About 360 of these turbofan engines are already in service in Bombardier Inc.'s Challenger 300.

Initially, Honeywell will produce about 40 of the engines in 2011 to meet Embraer's goal of putting the planes in service a year later. It expects to build ''hundreds of engines a year'' in the next decade, company officials said.

Honeywell had sales of $34.6 billion last year, with the aerospace division accounting for $12.2 billion. Apart from cockpit displays and engines, Honeywell also makes navigation, communication and weather systems, landing gear and auxiliary power units.