Qantas, Rolls-Royce agree $124m settlement

Australia's flagship carrier Qantas says it has reached an $A95 million ($NZ124m) settlement with Rolls-Royce over last year's mid-air disintegration of a superjumbo engine, which temporarily forced the grounding of its entire fleet of A380s.

Qantas CEO Alan Joyce said the terms of the agreement are confidential, but said the settlement's profit and loss impact would amount to an $A95m boost for the airline.

Joyce said the settlement marks an end to the legal proceedings Qantas launched against Rolls-Royce in the Federal Court of Australia in December.

In November, a Rolls-Royce Trent 900 engine on a Qantas A380 disintegrated shortly after takeoff from Singapore, forcing the plane to make an emergency landing.

The Australian Transport Safety Bureau's interim report on the A380 incident said a manufacturing defect in an oil pipe deep within one of the engines led to an oil leak, which sparked a fire. The fire caused a disintegration of one of the engine's giant turbine discs, sending pieces of it shooting through the plane's wing.

The engine explosion was the most significant safety issue an A380 had ever faced since it began passenger flights in 2007, and prompted intense scrutiny of Rolls-Royce engines.

The settlement will help Qantas recover from the millions it lost following the incident. The airline was forced to temporarily ground its entire fleet of A380s for a series of inspections, and Joyce said the plane damaged by the explosion won't return to service until February.

 

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