United's A350 Order Uncertain Due to Rolls-Royce Engine Dispute

• United removed delivery timelines for 45 A350s from its regulatory filing, previously expected after 2026, citing the December 2024 breach by Rolls-Royce
• The A350 order has faced 16 years of changes and deferrals since 2009, fueling speculation United may cancel or convert it to other Airbus models like the A321neo
• The dispute involves a 2010 long-term engine and maintenance contract, with both sides now claiming the other owes them money in ongoing legal proceedings

United Airlines A350 Order in Jeopardy Amid Rolls-Royce Engine Dispute

Key Developments:

United Airlines has disclosed a contract dispute with Rolls-Royce that threatens its long-delayed order for 45 Airbus A350 aircraft. The airline removed specific delivery timelines from its latest regulatory filing, citing only arrivals "after 2027" versus the previous "beyond 2026" guidance.

Financial Details:

• United paid Rolls-Royce $175 million upfront in 2017 as part of a 2010 long-term engine and maintenance contract
• United is now demanding the $175 million refund plus additional amounts
• The airline claims Rolls-Royce breached contract terms in December 2024
• Rolls-Royce denies any breach and maintains United is at fault; both parties claim the other owes them money

Background:

The A350 order dates back to 2009, making it one of aviation's longest-running procurement sagas spanning 16 years of changes and deferrals. The deal was originally placed before United's 2010 merger with Continental Airlines, a historically Boeing-exclusive carrier. Since then, the order has been repeatedly restructured and delayed.

Market Implications:

Rolls-Royce is the sole engine supplier for the A350, making this dispute critical to the order's viability. United cited the conflict could impact "other parties," likely referencing Airbus. The airline needs widebody aircraft to replace aging Boeing 767s and 777s.

Industry speculation suggests United may cancel the order or convert it to other Airbus models like the A321neo family, which it has purchased extensively. CEO Scott Kirby indicated in September 2025 that a decision would come later that year.

Both Rolls-Royce and Airbus declined detailed comment due to ongoing legal proceedings.