United Technologies Weighs On Separating Sikorsky Aircraft Unit And Impact Of EPA's New Emission Rules

United Technologies Corporation UTX announced on Monday that it plans to either sell its Sikorsky Aircraft helicopter unit or spin it off into a separate company.

Greg Hayes, United Technologies CEO, was on CNBC post the announcement to weigh in on this and to discuss the company’s supply chain readiness and new EPA rules regarding aircraft emissions.

Two Options

“I think, we have been talking about this now for about three months,” Hayes began. “The Board decided about it last week that we will proceed with either a spin or a sale and, I think, by the end of July, the next 60 days we will have a final determination, which of those two options it’s going to be.”

Supply Chain

On the company’s efforts to improve its supply chain, Hayes said, “We have been spending a lot of time making sure the supply chain readiness. We have teams out with all of our key suppliers as well as making sure not just our key suppliers, but the back-up suppliers also have capabilities. So, we are ready, the supply chain is ready. We just got to do it.”

Not Concerned For Future, But For Installed Base

Hayes was asked about the impact that the new EPA rules for aircraft emissions will have on the company’s business. He replied, “So, as you think about it the EPA rules, our new engines will be 75 percent lower […] emission. We are not concerned with going forward, the real key is we said before, it’s the installed base of about 25,000 aircrafts out there.”
“And how is the regulatory environment going to move across not just the U.S., but internationally because if you are moving these aircrafts around the world [you’ll have] different regulations for different countries,” Hayes concluded.